The biggest cricketing tournament, the ICC Cricket World Cup 2015, that is scheduled to take off on February, is significant for various reasons. Defending champions, India, are expected to draw eyeballs and advertising revenues. Around 105 million viewers have been watching the game already, making it one of the most-watched sports on Indian television.
According to media reports, the value of on-ground sponsorship for ICC World Cup in 2011 was around Rs 1,200 crore, and included brands such as Reliance Communications, Castrol, LG, PepsiCo, Reebok, Hyundai, Emirates, Yahoo, Castrol and Money Gram. These sponsors have been locked in till the end of the 2015 World Cup. Television advertising revenues from the previous world cup were estimated to be Rs 175 crore. According to the Pitch report “ICC CWC ’11: Rs 2,000 crore, not out” advertising spends on TV for cricket in 2011 was expected to be more than Rs 2,000 crore. So with the 2015 series inching closer, is it threatening to dominate ad spends, consequently affecting viewership and revenues on GECs and other channels?
Brand spends on World Cup to increase
The Pitch report in 2011 stated that advertising for cricket accounts for 85 per cent of all sports ad spends on TV. But the pitch has been queered now with the rise of other domestic sporting tournaments such as Pro Kabaddi League, IPL, Hockey India League, Indian Super League and Indian Badminton League and international sporting tournaments such as the FIFA World Cup 2014, International Premier Tennis League. Though many of these are new properties with fewer brands on board, they are big spenders.
Hero MotoCorp for instance has been sponsoring several domestic sporting tournaments this year, and is the title sponsor for Indian Super League (rights estimated to be Rs 60-65 crore). It has also signed a four-year sponsorship deal with Federation of International Hockey (FIH). Given that such top brands have already spent on other leagues and tournaments, questions is, will there be enough interest in the ICC World Cup, which is in the first quarter of 2015?
According to Vinit Karnik, National Director of Sports and Live practice, GroupM ESP, brands that are interested in parking their money on cricket, will continue to do so. “I don’t think the last quarter factor matters for cricket as a sport. They (brands) have locked in their funds for cricket, or they will,” he said, adding, “Cricket is undoubtedly the number one sport in the country and the ICC Cricket World Cup 2015 is going to be the most sought after property in the beginning first quarter of 2015 from a television point of view.”
Despite their novelty, the new sporting properties have not really managed to draw top dollars. (Will marketers' skepticism of Pro Kabaddi League haunt World Kabaddi League?) (Is ISL too slow to score with brands?). Besides, many of the brands have preferred to bet safe, and have traditionally chosen cricket over other sports, where they are assured of eyeballs. According to the Pitch report, Maruti Suzuki spent 30 per cent of their total TV advertising budget on sports, out of which 90 per cent was reserved for cricket and the ICC World Cup 2011. Similarly, the report said that Castrol had spent 25-30 per cent of its advertising budget for the ICC World Cup 2011. According to a media report, LG too had earmarked a budget of around Rs 70 crore for the previous cricket world cup, while Sony hand had a budget of Rs 100 crore. Star Sports would certainly hope for a repeat of the 2011 revenue show this year.
Threat to other channels?
Would the ICC World Cup then divert ad spends away from the other channels? According to Rohit Gupta, President, MSM, the heightened interest in the last World Cup was due to several factors. “The day and night matches were held in India. It was also Sachin (Tendulkar’s) last World Cup. This time, the tournament is being held in Australia-New Zealand, and during the day. This should not affect prime time at all. So brands may approach the 2015 World Cup with some hesitation because viewership is going to be very low during the day. Besides, the six initial games that India will play, are against Zimbabwe, Ireland and smaller teams. So I don’t see it affecting our ratings.”
According to a highly placed source in the revenue department of a television network, contrary to perception, ad revenues on non-cricket channels also go up during the World Cup, because brands are keen to max their exposure across all genres, channels. “Overall media exposure goes up. It is not that other channels have to have something special around the World Cup. There is a shift in eyeballs that happens initially, but eventually people tend to spend time across media, and not only on the cricket World Cup. If a particular brand is sponsoring, it won’t buy just the cricket series, but also exploit other media options around that time. So if for the World Cup they allocate Rs 1,000 crore or Rs 500 crore, they make sure that it is spent not only on the said property, but across all television channels,” he said.
Speaking about his channel’s strategy of ensuring viewer eyeballs during the World Cup, Ajit Thakur, GM, Life OK said, “We always compete with cricket as much as we compete with Star Plus and are comfortable with it. If our shows are strong they (viewers) will stay with us. I think the World Cup works (for us) because it is on the Star Network, but outside of that we have to still have to ensure that our stories on a high point, so we don’t lose our audience.”
While the bigger brands spend heavy on cricket, there are smaller ones that prefer to stick to the GECs because of the large ticket size of the sporting event. The cost of a 10-second ad spot during the final of the ICC Cricket World Cup 2011 was Rs 25 lakh. According to Dinesh Vyas, GM, MEC, “Smaller brands will probably stick to advertising on regular channels rather than buying on cricket. Now, if you have larger budgets and a new creative film or planning to launch a new product, or it is just the season for your brand to flourish, you may consider putting in some money on the World Cup. Marketers today have realised that if they cannot afford, for example, a Times of India, they will go to Mumbai Mirror or a Mid-day….Yes there could be loss of viewership but there are some genres (of channels) that do not get affected by cricket, such as news and GECs. The era of a sudden and sharp drop in viewership on other channels us a thing if the past. Now you have to struggle to find a spot on all regular channels as well.”