IPL Aggressive Marketing or Futuristic strategy? Presented by Dipak Jain

Introduction Launched by BCCI on the line of Football’s English Premier League and National Basketball League (NBA) of the US. Professional Twenty20 cricket league created and promoted by BCCI and backed by ICC. 8 teams, 44 days, and 59 matches. Total base price for auction was $ 400 million and fetch $ 723.59 million. Most expensive franchise is owned by Mukesh Ambani - $ 111.9 million. MS Dhoni and Andrew Symonds emerged as the costliest Indian and overseas player respectively.

Cont… DLF Universal secured exclusive rights to the IPL title sponsorship worth Rs. 200 Cr (over $50 mn) for 5 years. India’s Sony Television network and Singapore based WSG secured broadcasting rights at a cost of $ 1.026 bn for 10 years. Bring income of $ 1 bn to BCCI over a period of 5 to 10 years, out of which 40% will go to IPL, 54% to franchise, and 6% as prize money until 2017. Out of $ 1.026 bn, $ 918 mn to BCCI and $ 108 mn for the promotion of the tournament. 20% would go to IPL, 8% as prize money, and 72% would be distributed to the franchisees until 2012. Double round-robin and knockout.

Future Expansion Four new franchisees will join IPL in 2010-11. Two confirmed franchisees will be based in Ahmedabad and Kanpur. In 2012-13, two more teams will join the IPL. Possibly second franchise from Delhi’s suburbs. Possibly second franchise from Mumbai or new franchise from Pune. For 2009 season tentative dates for the IPL will be April 10th, 2009 to May 29th, 2009 and format of the tournament will remain the same as that of the inaugural season.

Profit or Loss? Franchise Revenues (in Crores) Expenses Profit/loss (in Crores) Price (USD) Mumbai Indians 69 85 Net Loss 16 $ 111.9 mn Royal Challengers Banglore 45 88 Net Loss 43 $ 111.6 mn Hyderabad Deccan Chargers 64 82 Net Loss 18 $ 107 mn Chennai Super Kings 72.8 73 Net Loss 0.2 $ 91 mn Delhi Daredevils 70.4 77 Net Loss 6.6 $ 84 mn Kings XI Punjab 66 68.4 Net Loss 2.4 $ 76 mn Kolkata Knight Riders 89 76 Net Profit 13 $ 75.09 mn Rajasthan Royals 59 53 Net Profit 6 $ 67 mn

ICL vs. IPL: The Competitive Edge Solid backing of BCCI and ICC with almost 10 huge stakeholders whereas ICL has a single promoter Essel Group. IPL is playing a safe game while ICL wants to create a new league of talent from upcoming aspirants. IPL seems to be attractive business model involving high level risk while in ICL level of risk is comparatively lower.

Research Analysis A research was conducted across 400 people in the city of Nagpur. 83% said Yes and 17% No

Cont… 44% did not miss a single match, 38% favorite teams matches only, 12% match highlights, and 6% only on holydays, sundays and weekends

58% found a sustained interest level throughout the match, 34% surfed through the channels and 8% are not interested

63% because of crisp timing, 29% others factors attract them, 5% said that Bollywood stars tempted them to watch, and 3% found entertainment value

62% preferred 8 to 11 pm, 12% no specific time to watch TV and equal number preferred to watch TV after 11 pm, 9% preferred afternoon slot of 2 to 5 pm, and 5% preferred morning time of 7 to 9 am

Only 24% did miss out on their favorite TV programs, and 76% answered negatively

60% said that IPL brought about a change in their viewing habit, 11% said that viewership pattern changed to certain extent, and 29% felt that it did not affect their viewership pattern in any way

38% feel that TRP of reality shows affected the most, 30% feel news channel would have suffered that most, 28% said family soaps were affected, and 4% feel that other channels affected

78% said Yes IPL is better than ICL, 14% said No, and 8% said to an extent it is better than ICL

37% feel that IPL is all about aggressive marketing, 31% said that great futuristic strategy, 26% feel that IPL is just a 45 days of masala, and 6% feel it is threat to TV and cinema

Conclusion IPL is a winning formula, its marketing and crisp timing being its USP. It also has the potential to beat the prime time TV shows as is evident from the views of people. According to Hemant Vasu Vidarbha, IPL needs to keep up to its expectation. IPL needs to create loyalties not just for the states the teams represent, but for the playing teams as well.

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