Cricket spirits soar, but IPL's ad rates are flat

While Star Sports and Jio, the broadcast and digital rights holder, respectively, were hoping for an increase in ad rates, media buyers confirm they haven't budged. 

Sponsors are expected to shell out ₹12.5 lakh per 10 seconds on SD and ₹5.3 lakh in HD on Star Sports. For Jio Cinema, pre and post-match ceremonies will be ₹200 cost per mille or 1,000 impressions. On connected TV, a spot will cost ₹6.5 lakh. These rates are around the same as last time.

Hema Malik, chief investment officer at IPG Media Brands, said IPL has strong believers and a lot of repeat advertisers, but she senses something different this year. “Over the years, we have seen a few seasons (of IPL) that begin with a slow start coupled with some challenges but eventually pick up," Malik said. “However, this is the first year in many years, so far, that clients are not warming up to the tournament as much. I won’t attribute it much to the IPL itself per se but a general slowdown. We are hopeful it will pick-up soon."

What is also playing a part is that many advertisers had spent substantial sums in the ICC Men's ODI Cricket World Cup late last year, and the T20 World Cup, scheduled to happen in the US this June, is also within their sights.

Typically, broadcasters have a history of working on a double-digit rate increase based on inflation. But that hasn’t happened either this time. “They wanted to capture as much inventory as possible (earlier), as early as possible without wasting any time in negotiations," another media buyer said on condition of anonymity. “Unfortunately, not much has materialised (this year). Some advertisers are also concerned that the World Cup is around the corner. Both broadcasters are under indexed or going slow right now."

Auto companies have put a pause on advertising, at least for now. E-commerce brands, telecom and fintech companies have also not stepped up to the plate yet.

But there are bright spots, too. “I wouldn’t say this year is not growing, but I think it’s flat, similar to last year. We will see more established brands coming rather than more startups. Advertisers are looking for the best possible deals. What is unique this year is that there is a lot more interest in connected TVs and digital advertising," said Aditya R. Kanthy, CEO & MD of DDB Mudra.

Then, there’s the fact that external factors, including the general elections, are unlikely to disrupt viewership. And there are several new sponsors that are cutting cheques.

“Nothing generally has any impact on the biggest media property in India, IPL," Srinivas Rao, chief investment officer at media buyer Wavemaker said. “For instance, Reckitt is a new sponsor this year. It has not advertised on any IPL on TV previously. Apart from that there are some other brands as sponsors that are normally not associated with cricket in a big way, but this time they will be seen. In terms of digital, new brands from categories like wallet and cement, are being seen as sponsors."

Star Sports said that by Thursday, it had signed 15 brands. These included Dream11, Asian Paints, Vimal, Thums Up Charged, Havells, Joy Cosmetics, Dettol, Harpic, Vanessa, Amul, Groww, Rupay and HDFC PayZapp.

Brand strategies remain consistent. Traditionally strong categories like cola, with Coca-Cola being a prime example, continue to be prominent advertisers. On television, established names like Coca-Cola, Asian Paints, Vimal elaichi, and Dream11 leverage the strong IPL fan base to reach their target audience.

This year, Mondelez and Coca-Cola will maintain their presence on both TV and digital, while brands like Haier and Vi India will focus solely on the digital space.

The big story continues to be digital growth. In 2023, ad spending on IPL's digital platforms grew by a significant 25%, said a recent report by GroupM ESP, the entertainment, esports and sports division of GroupM India. This trend is expected to hold in 2024.

The report said that when looking back at 2023, overall IPL advertising expenditure did see a decline, but this could also be because India hosted the ICC Men's Cricket World Cup later in the year. The report added that total spending on cricket advertising reached ₹7,074 crore in 2023.

Meanwhile, the fight between the two broadcasters -- Star and Jio -- resulted in a drop in combined ad revenue across TV and digital platforms last year. The business saw revenues drop from ₹4,600 crore in 2022 to approximately ₹4,000 crore in 2023, with Star receiving a majority of the revenue, Mint had earlier reported.