Having won the previous edition of the IPL, Kolkata Knight Riders (KKR) is gung ho about defending the title. On the business side, the franchise is protected from the economic slowdown having done three-year deals with sponsors that will only expire at the end of this season.
KKR CEO Venky Mysore has focused on making sure that KKR functions like a corporate. That means putting in systems and processes both on the revenue side and on the player front.
Indiantelevision.com‘s Ashwin Pinto caught up with Mysore to get his take on the franchise‘s progress. Contrary to media reports, he maintains that the franchise currently doesn‘t have any plans to dilute stake.
Excerpts:
Q. Reports indicate that KKR might bring in a strategic investor?
A: There is no truth to that at all. It does not make any sense whatsoever. There are no plans to sell stake.
Q. Were there challenges early on in the first few seasons in terms of brand building and perception with KKR not doing well on the field?
A: It is a fact that we were not performing at our potential. After three seasons we were the worst performing team. Over the last two years, the journey is something that we are quite proud of. A transformation took place. We changed the entire team. For the first time we qualified for the playoffs and Champions League Twenty20. Then of course, we won the event last season. The brand has also grown as a result.
Q. With your appointment KKR‘s aim was to corporatise things. Is the franchise being run more professionally now?
A: That is what we have aimed to do. We have looked at KKR as a business. Sports entertainment is our product. Behind the scenes, the aim has been to run it as a team and as a genuine business. The franchise model of the IPL is exciting and fascinating.
There is a huge opportunity to leverage the brand we have built. We also want to continue building on our foundation which is the fan base. On both counts we worked hard, put a lot of new initiatives in place to build fan base and extend our brand so that sponsors who associate with us have the opportunity to benefit from the brand.
When we do this, new revenue streams are generated. It has to be run as a team business as governance requirements are quite significant these days. We have to pay attention to that. We are proud of what we have done across the board but there is still work to be done.
Q. I believe that after coming in, you overhauled systems and processes to an extent on the business side. Could you shed light on that?
A. A big chunk of revenue comes from sponsorship. The key was to create a portfolio of brands that we associate with. In an ideal world you want brands that have synergies with each other and not just with KKR. You build a common platform on which each of the brands can jump on.
You can run events and activities that are common to brands like a meet and greet and press conferences. We have the largest number of brands among the IPL franchises – 22 that we work with. This has helped us not only generate new revenue but also leverage and activate our brand that the association with each brand has been strong.
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‘I do not know about other franchises, but our revenue generation through sponsorship and ticket sales is significantly higher than central revenue’
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Q. How is having Shah Rukh Khan as an owner helping? Is he hands on in terms of operations?
A. If he wanted to be hands on, he would not have brought in somebody like me. We have to do our job, but having him is a fantastic experience.
Q. Are sponsors still coming on the back of Shah Rukh Khan?
A. Shah Rukh is Shah Rukh. You cannot take anything away from that. We have the association and strength that comes from him being in the background. But our endeavour was to make sure that we bring in sponsors on the strength of KKR. We have succeeded largely in that area.
Q. Does the fact that you do not have a big corporate house backing you mean that you have to be prudent in spending?
A. Of course! You run it like a business. There has to be a lot of discipline. One just has to manage it like any other business and work through budgets and keep going.
Q. Your aim is have revenue growth of 25 per cent. What is the gameplan to achieve this?
A. It has to be a combination of efforts. One is to increase the existing revenue streams. Another is with ticketing. There are new opportunities for packaging and improving the fan experience further. On the other hand, it is also about looking at new streams of revenue like merchandising and licensing.
Q. Where does the franchise stand in terms of sponsorships?
A. We are fortunate that when we did deals in 2011, it was for three years. Therefore there are no new sponsorship deals other than Pepsi which came in this year. After this season we will figure out what happens. Most of our sponsors are likely to continue. Other companies have expressed interest.
Q. How do you cut through clutter?
A. There is no clutter. Each brand that is with us has its own target markets and strategy. It is the association with us that takes this to another level.
Q. Could you talk about how the Nokia association has benefited both?
A. Nokia has been with us from day one. Nokia has said that the KKR association has been hugely beneficial. We have also benefited greatly because of the manner in which Nokia activates the brand.
Q. In terms of local revenue, is your ticket revenue more compared to other franchises as the stadium is bigger?
A. I do not know about other franchises, but our revenue generation through sponsorship and ticket sales is significantly higher than central revenue.
Q. Could you talk about developing licensing and merchandising?
A. It is an on-going process. First, you build your fan base and your brand. It is only on the basis of this that licensing and merchandising will pick up. We have a range of products. We have a KKR store online. There is a tremendous potential for growth.
Q. How did the new slogan ‘One Team. One Pledge’ came about’?
A. It is about a marketing strategy. Last year we had ‘New Don New Knights’ which was a new theme. Now the emphasis is on the team and how we take it to the next level. The alignment of the team being one pledge means it will go out and give its best. That is the whole thought process behind it.
