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Star India’s IPL 2019 ad revenues slightly higher than those in 2018

By Asmita Dey

The 2019 edition of the Indian Premier League (IPL) is understood to have fetched broadcaster Star India advertising revenues of more than Rs 2,000 crore, slightly more than the revenues of Rs 1800-2,000 crore earned in 2018. Sandeep Goyal, chairman at Mogae Media, believes the revenues may have even crossed Rs 2,500 crore. Since the tournament was played across two financial years, clients have used residual budgets of the last financial year in March which normally were never available, Goyal told FE.

Moreover, Goyal points out that companies have shifted to advertising on sports channels from general entertainment channels (GECs) and movies after changes in the Trai s tariff order.

Analysts at Edelweiss have pointed out that with the onset of the new tariff regime and given the non-availability of the likes of ZEE Anmol, Sony Pal, Star Utsav and Star Bharat, Dangal TV and Big Magic have managed to increase their viewership two to three times, respectively, on an average in the Hindi GEC rural segment.

Advertisers are in a quandary over the sudden reduction in reach and are partially shifting to the news and sports genres, the analysts said. Star Utsav, Star Bharat, Sony Pal and ZEE Anmol have lost market share to Dangal and Big Magic even in Hindi-speaking urban markets. An industry expert said Star Bharat, &TV and Sony Sab may have seen revenues impacted.

This is the first time that the general elections, IPL and Cricket World Cup are taking place in the same year. Goyal estimates that Star will make revenues of about Rs 1,500 crore this year from the ICC Cricket World Cup starting in May. Reportedly, Star India s revenues from the Cricket World Cup in 2015 stood at around Rs 800-1,200 crore. Goyal says in the World Cup there are about 28 matches unlike IPL which has 60 matches. Of these 28 matches, only eight or nine are India matches. For India matches, the average rate for a 10 second ad slot is around Rs 17-18 lakh, but for non-India matches the asking rate for a 10 second ad slot is somewhere around Rs 7.5 lakh which eventually sells at about Rs 6 lakh. Hence, although there are 2,000 seconds of ad inventory in IPL and five lakh seconds of ad inventory in the World Cup, the average rate realisation for the latter is much lower as 75% of the inventory is non-India.

IPL is bigger than the World Cup. There are more matches and for a sponsorship, it would cost anywhere between Rs 50-Rs 60 crore. Star acquired IPL at a far higher cost than what Sony was doing. They will have to make up for those acquisition costs. Star has expanded IPL a lot and it is even more expensive this year because they have added a lot of promotional legs to IPL this year, said Anita Nayyar, CEO, India and South Asia at Havas Media Group. World Cup is not a sixty-day tournament, so at an overall level, revenues from the IPL will be higher, added Nayyar.

Vinit Karnik, business head of sports, entertainment and live events at GroupM, explained in a Duff & Phelps IPL report that an average 10 second ad slot for IPL television and digital advertising costs around Rs 8-10 lakh. The average spend on team sponsorship costs between Rs 30-50 crore, merchandise advertisement spending costs between Rs 30-100 lakh, on-field advertising (ground painting) costs Rs 1 crore and stadium advertising amounts to more than Rs 50 lakh.

The exhilarating, edge-of-the-seat action of the twenty20 (T20) format coupled with the glamour of Bollywood celebrities, global cricketing talents, interest of business tycoons and fan frenzy have catapulted IPL to the pinnacle of sports entertainment in India and the cricketing world, according to Duff & Phelps.

The overall value of IPL ecosystem has increased from $5.3 billion in 2017 to $6.3 billion in 2018, the report said.

With more matches going into the final overs, individual brilliant performances, supported with world class broadcast, IPL 2019 has witnessed a spectacular rise on the star network. With just four weeks into the tournament, IPL on star network had seen 411 million viewers tuning in. This was close to the total tournament reach of last year, a Star India spokesperson said.