Three decades after Kerry Packer revolutionised cricket with the World Series, cricket stands on the threshold of another potentially disruptive revolution. On 18 April, the Board of Control for Cricket in India (BCCI) will unveil the Indian Premier League (IPL), a format the Indian board hopes will change the way Indians watch the game.
Instead of cheering the country, one will cheer city-based leagues. Eight teams – Jaipur, Mumbai, Mohali, Chennai, Hyderabad, Kolkata, Bangalore and Delhi – will take the field.
Can this work? The answer is yes if one looks at the experience of the first mover in India – Essel Group’s Indian Cricket League. The ICL is currently holding its second event and is getting good visibility as matches are also being aired on Ten Sports. The on-ground attendance has also been decent, showing that if an event is well marketed there is scope. Considering that ICL has managed all this in the face of a take-no-prisoners onslaught by the Indian cricket board, what the officially sanctioned event might well deliver boggles the mind.
One must also note at the outset that IPL and ICL are possible because of the success of the T20 format. Initially there was some cynicism even within the BCCI as to how the new format would fare. The T20 World Cup, though, changed all that. With India winning, the viewership grew and the final scored a ratings of 9.81 TVR (Tam data, C&S 4+).
Broaden the game’s appeal: The aim of the IPL is to broaden the appeal of the game. Since matches will take place in the evening, the hope is that families including women and children will turn up in large numbers.
The IPL has also brought corporates closer to the game. Companies like Reliance Industries now own a team. This is expected to inject professionalism and also entrepreneurship. The larger aim is to push cricket at the grassroots and domestic level.
The IPL is conceived as a city-based league format. With the base price set at $50 million for the city-based franchisees, the teams were bought for well above that.
The prices paid show that after a lot of due diligence, corporate India views the IPL as being a serious business venture. Reliance Industries, for instance, paid $111.9 for Mumbai while Dr Vijay Mallya’s UB Group shelled out $111.6 million for Bangalore.
The IPL will have flair and flamboyance when you consider that Bollywood also got into the act. Shah Rukh Khan paid $75.09 million for Kolkata. Preity Zinta took Mohali for $76 million. On the other side, we have Emerging Media, an expert in organising sport, paying $67 million for Jaipur.
The broadcaster’s viewpoint: The BCCI hit the jackpot when the Sony-WSG combine bought the ten-year broadcast rights to the IPL for $918 million. Compared to this, the price that ESPN Star Sports (ESS) paid for ICC rights looks like a good bargain.
While many have questioned the financial wisdom of such a huge payout for an as yet untried format, the numbers do not look quite so daunting when the fine print of the deal is examined. The guaranteed payout commitment by Sony-WSG is $306 million for the first five years. The remaining $612 million, to be paid out in the second half of the deal, comes with an exit clause built in.
Sony president network sales, licensing and telephony Rohit Gupta is gung ho about the IPL, noting that T20 is the game’s future. “If you see the scene for the last four years, ratings for ODIs have been steadily falling. T20 brought the game back in a big way. The stickiness is far higher than it is for the other forms of the game.”
Marketing is of paramount importance: The main challenge for IPL is for the franchises to build up fan clubs. After all, Indians are not used to cheering at a local level. As Gupta notes, the key challenge for each of the franchisees is getting fans of that state to identify with the team.
The first step in that direction was to have names that reflect the city. So Emerging Media christened the Jaipur team as Rajasthan Royals. The aim is to convey the pomp and regal splendour of the city.
Reliance has called their team Mumbai Indians to show the character of this city. They, like the other franchises, will run a 360-degree marketing initiative with a strong local flavour.
Glamour is also an important quotient in the marketing strategy. Cricket and Bollywood are two religions in India. Mix them and the result is potent. For instance, Bangalore has roped in actresses Katrina Kaif and Deepika Padukone for a music video to promote their Royal Challengers.
A push for domestic talent: One of the great things about the IPL is that it gives youngsters the chance to prove themselves. At the second auction, a draft for the Under 19 was held. This was to ensure that in a few years time India will have a young talent pool who are experts in this format of the game.
RoI: There are several revenue streams available for franchisees. There are central revenue streams, which include a share of the TV rights. The franchisees will get 80 per cent of TV revenues in the first five years and 60 per cent from the next five. They will also get 60 per cent of sponsorship revenues. The franchisees get all local revenues.
The revenue will come from many sources including gate revenues, franchisee shirt sponsorship, local sponsorship, licensing programme and uniform merchandising.
Reliance and Emerging Media are looking at a three-year time frame to break even. If, however, the IPL takes off, then that period could be sooner.
Gupta adds that corporate involvement is the best thing that could have happened. “Now you will see more accountability from the players. If a corporate house has paid over a million dollars for Dhoni, then he better perform. It can no longer be a case of doing well in one match and taking it easy for the next three.”
Performance is key in brand perception and each franchise will be doing its utmost to ensure that perception is not hurt by a lack of on-field performance.
Infrastructure will get a boost: Corporates will back infrastructure creation like academies and training camps since these are the places where talent will bloom.
Mindshare’s Hiren Pandit says that Deccan Chronicle is looking at grassroots activities. There are plans to take this concept to schools and colleges. Therefore, there is a larger picture at stake.
A mix of caution and optimism: As far as advertiser interest is concerned, DLF, which lost out on the franchise bid, has taken the IPL title sponsorship. Hero Honda is the co-sponsor.
Sony Entertainment Television (Set) India, which has telecast rights for the matches, has closed its advertising sales. Set India CEO Kunal Dasgupta says ad sales revenues have already crossed Rs 2 billion.
Pandit says that companies that get involved with the IPL early will reap the benefits in the long run. When asked about the mix of sports and entertainment, he says that for IPL it is important that while the entertainment quotient like the opening ceremony is good, the cricket played should be serious.
“It should not be treated as a tamasha. Otherwise you lose out on both,” warns Pandit.
Lodestar Universal CEO Shashi Sinha, though, has doubts over whether the high rates of sponsorship are worth it for clients. In his opinion, it might be over-priced. “If the IPL does not live up to expectations of advertisers, there will be losses,” he cautions.
IPL could boost globalisation of cricket: What IPL might do is globalise the game. T20 is, in fact, the best way to get new countries like China involved with the game. Since it is only three hours long, it is easier to get new audiences to sit through it. Adam Gilchrist seconds this view saying that it is important that other nations start playing the game.
Gilchrist also says that IPL should be given time to grow. It is important not to be pessimistic about it straight away. One will get an idea of how it is faring after a few years, he adds.
Conclusion: BCCI VP and DLF IPL chairman and commissioner Lalit Modi is very confident that the IPL will mark the dawn of a new era in Indian cricket. One would, however, be better served by not getting bowled over by all the hype and hoopla that is surrounding what could well be termed the ‘gentleman’s game’ on steroids. The maidens may be bringing in sex appeal to the new format but how the event fares over the next three years will be the real test to assess where the IPL, and for that matter ICL, stand.
