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New Delhi: The Indian Premier League (IPL) ecosystem value has dipped by 3.6% to ₹45,800 crore post the 2020 season from ₹47,500 crore after the 2019 edition, said a report released by Duff & Phelps, a Kroll Business. This was largely due to Vivo pulling out of the title sponsorship deal, additional costs involved to create a secure bio-bubble environment and lack of gate receipts.
All team franchises witnessed an average reduction in their brand values by 8-9%, largely due to reduced franchisee-related sponsorship revenue, loss of gate receipts, reduced food and beverage (F&B) revenue, and certain teams’ on-field performances and off-the-field issues.
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IPL 2020, held in UAE, was not open to physical audience. Chennai Super Kings witnessed the steepest decline of 16.5% followed by Kolkata Knight Riders at 13.7% and Kings XI Punjab at 11.3%.
Delhi Capitals is the only team that experienced a minimal impact with its brand value decreasing by 1.0%. Things have changed for Delhi Capitals ever since JSW Group entered the fray improving team’s performance significantly from the lows in 2018.
The ‘IPL Brand Valuation Report 2020’ evaluates the overall ecosystem which represents the value generated by IPL as a business. It includes the business value of all the franchisees and IPL governing body (Board for Control of Cricket in India (BCCI).
In 2020, IPL season 13 witnessed lower sponsorship revenues as compared to previous years. Dream11 paid ₹222 crore for the season, as against Vivo’s cancelled contract of ₹440 crore per season for the title sponsorship.
BCCI’s overall revenue stood at ₹4,000 crores as the board cut costs by 35% last year, against the anticipated revenue loss of over ₹3,000 crores had the league been cancelled.
The report also noted that IPL 2020 witnessed digital-first companies becoming season’s theme with fantasy sports platform Dream11, edtech firm Unacademy and CRED joining IPL as title sponsors and official partners. Apart from that, the two-year-old Mobile Premier League is also sponsoring two widely talked about franchises, Kolkata Knight Riders (KKR) and Royal Challengers Bangalore (RCB).
Despite covid-related challenges, IPL’s impact on its sponsors/partners continued to be remarkable. Following the announcement of central sponsorships by the Board of Control for Cricket in India (BCCI), the title sponsor Dream11 secured $225 million in funding, one of the official sponsors Unacademy joined the unicorn club with funding of $150 million, and another official sponsor CRED secured $80 million, bringing it closer to unicorn status.
“Last year was a litmus test for IPL and the property has come out of it with all guns blazing. The next big trigger for the T20 tournament will be the anticipated addition of two new teams from 2022. It would be interesting to see how BCCI manages to accommodate these teams either by extending the duration of the league or increasing the per day matches which is likely to have an impact on team revenues,” said Santosh N, external advisor, Duff & Phelps India Pvt. Ltd.
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