Lodha Panel verdict on CSK & RR to have limited effect on IPL brand pull, say experts

While there may be pitfalls for IPL in the next two years in the absence of CSK and RR, from a broader perspective, IPL’s brand power will not diminish, say marketers and media planners

e4m by Collin Furtado
Updated: Jul 15, 2015 10:29 AM
Lodha Panel verdict on CSK & RR to have limited effect on IPL brand pull, say experts

IPL has been big on brand attraction. The recent edition of IPL had seen a number of brands associating with the property whether it was on-air, on-ground or team sponsorship. We had earlier reported brands had increased their spends by 15-25% on IPL 8. While the on-air ad spends are expected to over Rs.1,100 crore this season from an estimated Rs.800 last year. The on-ground sponsorship for IPL was estimated to rake in Rs.250 crore, while team sponsorship for some teams had risen to Rs.30-35 crore from Rs.20 crore last season. But the recent verdict by the Lodha panel to suspend two teams i.e. Chennai Super Kings (CSK) and Rajasthan Royals for two years comes as big blow to brand power of IPL.

IPL 8 managed to get 12 brands as lead sponsors for on-air which includes Vodafone, Amazon, Hero MotoCorp, Vimal Pan Masala, Paytm, Intex Mobiles, Cardekho.com, Magicbricks.com, PepsiCo, Raymond and Parle Products. On-ground had brands such as PepsiCo as the title sponsor, followed by Yes Bank, Hotstar.com, Vodafone, McDowell’s No.1 and CEAT. Similarly, there were a score of brand associations for the IPL franchises. Some teams like Kings XI Punjab had seen even 16-18 brands associations. With IPL high on brand attraction we asked marketers and media planners if the property would face issues in attracting brands in the next season due to the Lodha panel verdict.

While brand marketers definitely felt that the issue would have a great impact on how brands will look at associating with the property, senior media planners felt that the banning of the two teams will be limited to a short term impact. According to a marketer from a brand which is a key sponsor of an IPL team on the condition of anonymity said it will definitely impact a brand’s association with a team. Brands associated with the IPL teams CSK and Rajasthan Royals might choose to pull out in the same way that brands pull out of their association after what happened during the Tiger Woods controversy. No brand wants to be associated with something that is controversial.

Sanjay Tripathy, SVP – Head Marketing, Product, Digital & Ecommerce, HDFC Life said, “The brands involved with the franchise will definitely get affected. Overall people viewing the tournament will come down because of these two popular teams, so overall the viewership will come down. So that will indirectly affect the entire ecosystem of IPL. I think the BCCI will have to build confidence in how they are cleaning the system and how such issues will not get repeated in the future. I think IPL is a great sports franchise created in India, so they should take steps to protect the brand so that it does not get affected. It all depends on what steps they take from now onwards to keep the brand value intact.”

Mayank Shah, Dy. Marketing Manager, Parle Products said, “As far as the corruption and scandals are concerned that is not going to affect the IPL. That (corruption) has been there since the inception and even before that. Betting and matching fixing scandals have been there with cricket since a long time and that is not really going to take anything from the game. But the second thing which would probably affect the two teams would be less and the total number of teams playing would be 6, this would have implications on the interest levels. And both the teams banned for two years are good teams. This would affect brand interests too. So given that, to retain that kind of interest is going to be challenging for IPL.”

Tuhin Mishra, MD of Baseline, a sports marketing company said, “Sponsors who have long term vision with IPL will not panic. Spectators and viewers want to get entertained. As long as that happens, nothing will happen to IPL in the coming years as its too big a brand/property globally.”

P.M. Balakrishna, CEO, Allied Media too felt that the verdict will not have much of an impact on IPL as a property and brand associations with it. “From a ruling point of view it is only going to be welcomed by all stakeholders. From one perspective, the game is getting cleaned up and will be seen as progressive move. So I presume that there is no reason that IPL or BCCI can’t get a bit creative and maybe introduce couple of other teams in the next season. They have a lot of time as IPL has just got over. To mind from 8 teams to 6 teams it will only have an implication from a broader perspective on the number of matches and total number of days,” he said.

Dinesh Vyas, GM, OMD also felt that the verdict will not affect the image or the brand attraction for IPL and in fact could be an opportunity for IPL to have two new teams and with players switching franchise’s it could open up opportunities. “I don’t think it will affect the image of IPL. People have always considered IPL as an entertainment event, they have never taken it seriously. Prima facie that is what it looks like and the IPL will still continue,” he said.

Ashish Bhasin, Chairman & CEO, South Asia, Dentsu Aegis Network said, “In my opinion IPL is a very large property for this to have an effect on brand attraction. But I think such an issue will dent it a bit. What will have a much larger effect on IPL is what will be the implications of the verdict? Whether the IPL will play with six teams or start with two new teams? This will have a bigger dent on the IPL.” He further added now these recommendations are a panel and it still remains to be seen whether the Supreme Court will follow these recommendations. Then we will see an effect on IPL.

Shah also pointed out that even post the verdict the BCCI can choose to appeal to the Supreme Court on the plea of the large number of players and staff working for the team who were not involved in the scam. This could see the apex court reviewing the recommendations by the panel and punishing the owners and those players involved but allowing the two teams to participate in the IPL.

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