Breaking down Star India’s Rs 3,000-crore revenue strategy for IPL 2020
Being held under the shadow of the ongoing Covid-19 global pandemic, there is a lot at stake for the Indian Premier League (IPL) 2020. The Indian Government’s latest directives on visa restrictions have put a question mark on the participation of foreign players in the tournament. As of now there is no statement on the status of their participation and things are going ahead as planned.
Currently, promotions for Vivo IPL 2020 are in full swing. From what we know, looking at their campaign creatives, Star Sports has roped 5 co-presenting sponsors (Vivo, PhonePe, Dream11, Amazon Prime, Coca Cola) and 6 associate sponsors (Asian Paints, Maruti Suzuki, Voltas, Kamala Pasand, Fortune and BYJU’s).
Star India has set an ambitious advertising sales target of Rs 3,000 crore for IPL 2020, according to a report by Economic Times (ET), a whopping 40 per cent jump from last season. IPL has grown over the last three seasons to become a formidable property reaching 900 million eyeballs. Ad rates are pegged at Rs 12.5 lakh per 10 seconds compared to Rs 10 lakh in the previous season.
Board of Control for Cricket in India has announced the schedule for Vivo IPL 2020 that will run from 29th March till May 24th. On weekdays and Saturdays, Star Sports will air IPL on their 7 sports channels including their language feeds and Star Sports Select.
On Sundays, Star Sports will air the 3 hour matches on their movie and kids channels (Star Gold, Hungama, Vijay Super, Star Maa Movies, Jalsha Movies, Star Suvarna, and Asianet Plus) quadrupling their revenue on Sundays with afternoon and evening matches compared to weekdays.
Amol Dighe, CEO, Madison Media Ultra & Head of Investments, Madison World, observed, “Typically cricket is a male oriented sport and the core audience even today is still male. The content which IPL is delivering (including language feeds, surround programming, and Hotstar) is something that appeals to the entire family. The female viewership has been growing year on year. So it is a good fit for brands that are targeting a mix of male/female viewers.”
According to Mamatha Morvankar, Chief Investment Officer, OMG India, Star Sports is making a concerted effort to attract a wider audience to sample IPL. “They are bringing the Sunday matches of multiple channels which can bring new audiences especially in the regional markets. This will also give them a wider base of audience because they are putting these matches in the movie genre or GE category. Star Sports has made IPL a far more national property compared to Sony which only had their Hindi channel. With Star Sports’ regional feeds they have made it relevant to all kinds of audiences.”
She adds, “I’m not sure whether that translates into a family audience but they are getting a wider set of audiences from an age group perspective, higher proportion of female viewers, so yes, that is improving although I don’t believe a complete turnover to family viewing has happened yet.”
Between sponsorships and spot buys Star Sports can easily touch Rs 2400 crores or 80% of its advertising sales target. The rest of the revenue will have to be earned via Hotstar and their international broadcast deals like with Sky Sports UK.
With little more than 2 weeks left for the first match of the season, Hotstar has yet to unveil all their digital sponsors. Vivo, Maruti Suzuki, Coca Cola and Dream11 have returned as sponsors this year with Khata Book joining for the first time.
Amol Dighe said, “This year a lot of new advertiser categories have come onboard such as OTT players. Amazon Prime has taken the co-presenting sponsorship. Last year, the sponsor was Amazon.in so this year they will be promoting their OTT offering. Year-long advertisers such as the handset category and FMCG category will also look to associate with IPL.”
While digital brands like Swiggy and BYJU’s stole the show last year with their IPL campaigns, this year OTT players like MX Player, Netflix, Amazon Prime Video and Disney+ Hotstar are expected to dominate airwaves. MX Player has set aside a budget of Rs 20 crore for IPL 2020 sources tell Adgully.
Last year, Hotstar reportedly charged Rs 50 crores for co-presenting sponsorship and Rs 25 crores to be an associate sponsor according to InsideSport. Inventory on the digital platform is sold at 240 CPM (with targeting) and 120 CPM (without targeting) indicated by various media reports.
Hotstar has self reported 345 million viewers tuning in for the first 2 weeks of IPL 2019 and delivering 28.9 million impressions for advertisers, so if broadcast rates are too steep for some advertisers the digital streaming platform is offering targeted ads with higher RoI.
It is important to look at Hotstar as a platform for interactivity and engagement, says Mamatha Morvankar. “Packages for Hotstar are being sold separately by a different team, however, clients may buy both packages. This year Hotstar is offering interesting packages starting from Rs 50 lakhs right up to Rs 12 crores that have been created to attract smaller clients.”
Hotstar could potentially add another Rs 375 crores to Star India’s broadcast earnings just from sponsorships assuming the rates are the same as last year. With their CPM packages, they could attract new clients to sample Hotstar who might become sponsors in the next season of IPL.
While most of the same clients have joined as sponsors this year, planners observe that clients that have never associated with IPL before are showing a keen interest in the property this year. The other big sporting event will be the T20 World Cup which coincides with the festive season.
Hotstar could potentially contribute 15-20% to Star Sports advertising revenue from IPL 2020.
All indicators point towards Star Sports reaching their advertising revenue targets despite the economic slowdown. But the World Health Organisation (WHO) declaring Covid-19 as pandemic could throw a spanner in the plans. Media planners have refused to comment on the implications of the Coronavirus spread on the tournament, stating that it is up to the BCCI to postpone or call off the event. With the trend of several industry events getting postponed due to the virus, it remains to be seen how IPL 2020 will be impacted due to the outbreak.