Rewards for IPL teams not based only on performance

Rewards for IPL teams not based only on performance
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First Published: Mon, May 25 2009. 11 58 PM IST
Updated: Mon, May 25 2009. 11 58 PM IST
New Delhi: Many cricket followers may have laughed at them for their dismal performance during the second season of the Indian Premier League (IPL), but the Kolkata Knight Riders (KKR) are the ones laughing their way to the bank.
Not only did they bag the maximum number of brand sponsorships but they also beat the other teams in the earnings game. And that tells us a lot about the way cricket has changed after the coming of the popular Twenty20 league.
KKR was the first team to get eliminated from IPL this year. Last year, too, its performance was one of the poorest.
Yet, this year, the team had an impressive number of brand sponsors, at least 12, on board.
These sponsorships translate into an estimated revenue of Rs100 crore, against around Rs70 crore raised by last year’s champion Rajasthan Royals and Rs50 crore by this year’s victors Deccan Chargers.
KKR has also emerged the strongest IPL brand in a study conducted by management consultancy MTI Consulting and UK-based brand valuation company Intangible Business Ltd. The study titled IPL Brand Value Scorecard 2009, has pegged KKR’s brand valuation at $22 million (Rs104 crore), followed by Delhi Daredevils at $19 million, while Deccan Chargers and Rajasthan Royals finished last in the league with brand valuations of $11 million and $10 million, respectively. The study arrived at brand valuations by analyzing a team’s efforts to generate consumer interest, its heritage (largely irrelevant in the first year), its connect and reach among Indian as well as international audiences, loyalty among fans, its ability to command premium and its success on the cricket field. “Besides these, the owner’s personal equity and the measure of its impact on the brand, the awareness and the perception of the brand among consumers was also taken into account to calculate a brand’s value,” said Hilmy Cader, chief executive officer, MTI Consulting.
To be sure, KKR was one of the buzziest brands last year as well as this year. According to estimates from media buyers, both KKR and Delhi Daredevils spent the maximum amount of money, around Rs30 crore each, on their marketing in both the seasons, while Deccan Chargers and Rajasthan Royals were the most frugal with their marketing spends not exceeding Rs10 crore.
KKR’s owner, Bollywood heart-throb Shah Rukh Khan, and captain Saurav Ganguly have also contributed a lot to the team’s popularity and hence the brand value. “In IPL, teams that have successfully blended cricket, entertainment and glamour would be valued the most,” said Shashi Sinha, chief executive of media agency, Lodestar Universal. “IPL isn’t about a year’s profit or loss...it’s about long-term connect the teams make with the audiences.”
This year, the brand KKR remained top of mind because of an anonymous blogger, the self-styled fake IPL player, whose juicy accounts of what was happening inside the KKR camp generated a lot interest.
On the other hand, superb performance on the cricket pitch by champions Deccan Chargers and Rajasthan Royals has not reflected in their brand valuations. The MTI study blames the low-profile maintained by the two teams for this. “Absence of a popular brand ambassador, lower awareness of Deccan Chronicle group (the company that owns Deccan Chargers) and lesser marketing and branding initiatives by the team owners have been key factors in preventing Deccan Chargers building a popular brand,” says the study.
MTI’s Cader, however, says that Deccan Chargers win this year may deflect some of KKR’s fans their way. “...when we calculate the brand values next year, we expect the sponsor interest in KKR to largely remain the same but much of their fan following might move to teams that performed well such as Deccan Chargers and Royal Challengers.”
Read today’s Campaign for a detailed analysis of each team’s brand value and revenues.
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First Published: Mon, May 25 2009. 11 58 PM IST