Dream11 had been an associate sponsor of the IPL since 2018 and had outbid Tata Sons, Unacademy and Byju’s in 2020
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NEW DELHI :
The Tata group replaced Vivo as the title sponsor of the Indian Premier League T20 cricket tournament for this season and the next, the last two years of IPL’s contract with the Chinese mobile phone maker.
“They (Vivo) have two years and did not want to continue— so they assigned the rights (to someone else). Tata and Vivo together will pay the same amount, which has been committed by Vivo. Apart from that, there will be incremental charges since there are 74 games and an additional 6% assignment fees to be paid by Vivo to the Board of Control for Cricket in India (BCCI)," IPL chairman Brijesh Patel said in a phone interview.
Vivo had agreed to pay ₹440 crore annually for the sponsorship when it bagged the rights in 2017 for ₹2,199 crore for five seasons beginning 2018. While the original deal was to end in 2022, it was extended till 2023 as Dream11 replaced Vivo in 2020. With Vivo assigning the rights to Tata, the latter will pay the remaining share. However, the 6% additional amount will be paid by Vivo directly to BCCI since the sponsor did not complete its five-year term.
In a statement, Jay Shah, honorary secretary of BCCI, said: “We are truly happy that India’s largest and most trusted business groups have believed in the IPL growth story and together with the Tata group, we will look to take Indian cricket and the IPL forward to greater heights."
Tata Sons confirmed the development but declined to disclose further details.
The Tata group’s recent foray into several consumer-facing digital businesses may have played a part in the decision, brand experts said.
“Tatas are ‘youngifying’ their brand with a lot of accent on digital, going forward. The IPL sponsorship should help tremendously with that. IPL is the biggest television (and now digital, too) event in the country. So the Tatas have lots to gain in terms of growing brand equity," said Sandeep Goyal, managing director, Rediffusion.
Communications strategy consultant Karthik Srinivasan agreed. “Tatas have likely taken this mantle so that they can actually build on their corporate group and super app ambitions. They’ve been making acquisitions like BigBasket for grocery supplies and 1mg for online healthcare. They have interest in multiple areas, including airlines and are likely to build on the Tata brand trust itself," he said.
While the reason behind Vivo’s exit isn’t clear, it could be prompted by the China-India tensions or the more immediate one of heightened tax scrutiny on Chinese mobile phone makers, Srinivasan said. Last month, the tax department searched several handset makers, including Xiaomi and Oppo. Oppo and Vivo are brands owned by the same parent company—China-based BBK Electronics Corp.
Vivo did not respond to queries sent by Mint.
A sports marketing executive said Vivo decided to withdraw from the upcoming seasons as they realized they had overbid. “In the absence of adequate return on investment, they pulled out," the person said, declining to be named.
When Vivo exited IPL sponsorship in August 2020 owing to the pressure faced by Chinese brands in India after the Indo-China border skirmish at Galwan Valley, it was replaced by online fantasy gaming platform Dream11, which paid ₹222 crore for the title sponsorship of the 13th edition played in the United Arab Emirates in September that year.
Dream11 had been an associate sponsor of the IPL since 2018 and had outbid Tata Sons, Unacademy and Byju’s in 2020.
All eyes are now on the IPL media rights auction for 2023-2027. The broadcast and digital media rights for the property are likely to see fierce bidding among the current rights holder Star India, Sony Pictures Networks India, Reliance-backed Viacom18 and Amazon Prime Video. Star India won the global media rights for IPL in 2017 for ₹16,347.50 crore. Media and sports industry executives estimate that the IPL media rights cost will double at ₹30,000 crore for five years.
From the 2023 season, two new franchises—one each in Ahmedabad and Lucknow—have been added by BCCI, leading to more games.