The Money Game

That voice of dissent was of CVL Srinivas,chairman of SMG India,a leading media buying house. This time,though,when the World Cup advertising sales began at Rs 4-5 lakh per 10 seconds; or later,when the ad slots for the semi-final between India and Pakistan and the final between India and Sri Lanka were sold for Rs 15-17 lakh and Rs 20-22 lakh respectively,Srinivas was unfazed. Though even now,a 10-second ad slot on prime-time soaps is sold for anywhere between Rs 75,000 and Rs1.5 lakh depending upon the profile of the channel and the programme.

The ICC World Cup may be over,the celebrations done,the accolades exhausted but the profits are still piling up. Not just in terms of money and other goodies being showered on our cricketers but also the revenue generated by the event and the bonanza for the International Cricket Council ICC,the Board of Cricket for Control in India BCCI,sponsors,advertisers,television channels and others who have jumped onto crickets money-spinning bandwagon. The total receipts for the ICC from the World Cup was Rs 1,476 crore while the cost of organising the event was Rs 571 crore. The ICCs revenue is estimated to be Rs 1,062 crore from sponsorships and telecast rights,which account for 72 per cent of its total income. That figure would have been far lower if India had not made it to the finals or had the tournament been held elsewhere.

Not just the ad rates,even the title and other sponsorships,which were sold for Rs 5-10 lakh in 2003,went for Rs 25-30 lakh this time. Indeed,at 1.1 billion,ESPN Star Sports,the official broadcaster had paid double of what the former rights holder Global Cricket Corporation had paid 550 million and it had to recoup the investment by selling the advertising,the primary source of revenues,at a higher price. Yet,the massive spike seemed to be counterintuitive. Importantly,the cricket market had completely changed between 2003 and 2011,points out Mona Jain,chief operating officer,Vivaki Exchange,a media planning and buying agency. In 2003,World Cup was a premium property. It came once in four years and,in between,you only had India matches to put your money on. Whereas today,there is too much cricket in the air, she says,referring to the various T20 competitions alongside the biggest sports-cum-entertainment product of recent times,the Indian Premier League.

What remained unchanged between 2003 and 2011,however,is the passion for the sport,and more than that,the absence of a universal tool like cricket that could help an advertiser target Indian consumers at a mass level,cutting across demographic,geographic,socio-economic,language,culture and even gender barriers,says Srinivas. The game pays. It delivers. It is an effective platform for a regional brand wanting to reach the national audience and vice-versa. It gives you reach,eyeballs,and also,impact, he says. No TV show is watched with the kind of passion that cricket is.

There is,in fact,nothing official about the Men in Blue. The phrase may have become the moniker of the Indian cricket team,but it is not an official title coined by cricketing authorities. Men in Blue was a slogan conjured up by PepsiCo India in 2003,when it acquired the official sponsorship rights to the World Cup. Having bought the rights for Rs 350 crore,the company went on to hire almost all the members of the Indian cricket team as its brand ambassadors and bombarded TV screens with cheeky ads,featuring reigning cricketing heroes. The fact that Men in Blue has since then become the unofficially official identity of the Indian cricket team says a lot about the cola companys marketing intelligence and crickets close link with commerce.

Cricket was,and continues to be,central to Pepsis marketing DNA in India, says Shashi Kalathil,chief executive,YFactor,a management advisory firm. Kalathil has had a long association with the world of marketing and cricket. He was the brand director of Pepsi between 1998 and 2004 and later,the CEO of sports channel Neo Sports between 2006 and 2008. Cricket became a very useful tool for Pepsi to target the entire Indian consumer market, he says.

Pepsi isnt the only marketer to have used cricket as a platform to get an entry into Indian consumer households. Several brands,mainly those that entered India around liberalisation,hitched their carts to the cricket carnival. Kalathil,though,argues that cricket became a big carnival after so many carts got hitched to it. Liberalisation opened the doors for several companies and brands that,hitherto,had no or limited interest in the Indian market. Suddenly,the worlds top consumer goods brands one of them being Coca-Cola,two-wheeler makers TVS,Bajaj,Hero Honda,car companies,durables manufacturers LG and Samsung and financial services providers various banks and insurance companies wanted to get a foothold in the Indian market and be the first to befriend the Indian consumer, says Kalathil.

The accelerating economic growth,especially in the past five to seven years,has led to an extensive socio-economic segmentation of the Indian consumer market today but even in those days,the market was fairly complex and heterogeneous given the cultural diversity of the country.

It8217;s a market that just keeps growing. The World Cup prize money dished out by the ICC is to the tune of Rs 1.33 crore for each of the 15 players in the Indian side. Not to be outdone at least not by much,the BCCI,has decided to add a cool Rs 1 crore to the pay packets of the players.

Riding on that success,ad rates for the coming IPL-4 have risen 30 per cent to Rs 6 lakh for a 10-second slot. Sponsors of individual players also have a special reason to cheer in 2011. The World Cup win will bring a huge jump in the brand status of these cricketers. Dhoni,Tendulkar and Yuvraj are now expected to earn between Rs 5 crore and Rs 10 crore annually in advertising fees,rivalling Bollywood stars like Shah Rukh Khan and Aamir Khan.

Televised cricket matches like the Word Cup or IPL can capture 60 per cent or more of the Indian audience,some 450 million people,a huge number for any sponsor or advertiser.

The growth of the sponsorship and advertising market and the ability to attract huge viewership has been a big motivation for broadcasters to bet on cricket. And this has reflected in the way the prices of cricket broadcast rights have zoomed in the past 15 years. In the early 1990s,liberalisation had spurred the growth of another industry cable and satellite television broadcasting. The three big broadcast companies Rupert Murdoch-owned Star Network,Subhash Chandras Zee Network and Sony Entertainment Television,renamed later as Multi Screen Media Pvt Ltd MSMPL each wanted to conquer the market. Then came Kaun Banega Crorepati in 2001 and Star beat its two rivals in a conquest that lasted for nine long years. This left Zee and Sony fighting for the number two slot and soon Zee had outsmarted Sony.

And then,Sony did what was then thought to be suicidal but later turned out to be its best bet for survival. In 2002,as a stunned industry looked on,Sony bought the telecast rights for two cricket World Cups 2003-2007 and two Mini World Cups from the ICC for an astonishing 350 million Rs1,200 crore.

The broadcaster didnt have a sports channel in its bouquet,so it decided to air the matches on its events channel,MAX,which didnt even figure among the top five TV channels then.

Sony,indeed,made profits on its bet,not only monetarily but also in terms of securing a future for its flagging channels. During the World Cup in 2003,MAX was the most-watched channel,having beaten even Star Plus. Even after the tournament got over,it had successfully established itself among the top five channels. Indeed,to recoup the massive investment it had made,the broadcaster made all possible efforts to woo new audiences and to promote its other brands,such as the flagship channel Sony Entertainment Television.

Indeed,the Indian cricket teams poor performance in 2007 hurt the channel. But in the next year,it already had another winning cricket property the Indian Premier League. The IPL was an unknown territory. It was a big risk we were taking but we had faith in cricket and,so far,it has paid off, says Rohit Gupta,head of network sales at Multi Screen Media.

In 2006,sports broadcaster ESPN-Star Sports did a Sony when it bought the World Cup rights from ICC for 2007-2015 for an even more staggering sum of 1.1 billion. The sports broadcaster was facing the same dilemma that Sony faced in 2002. BCCI rights,the mainstay of any sports broadcaster in India,had been hawked by a new player Nimbus which built a broadcast business on the back of India rights bought for four years from BCCI for 612 million. ESPN-Star Sports didnt have any bankable cricket event in their pocket and many industry observers then said that the sports broadcaster was on the brink of a collapse. In India,sports broadcasting is built around cricket,mainly matches in which India is playing. To explain it in terms of numbers,90 per cent of sports revenues come from cricket and 95 per cent of cricket revenues come from games in which India is playing, says Sameer Kale,of CMCG,a sports marketing and public relations firm.

Like Sony,it seems ESPN-Star Sports big bet on cricket will also pay off. While Sony had made around Rs700-800 crore off the 2003 and 2007 World Cups,ESPN-Star Sports is already expected to have pocketed Rs700 crore from the first tournament. Cricket is a religion in this country,and not for no reason, says Rathindra Basu,senior director,ESPN Software India.

Like ICC,BCCIs fortunes have also risen because of the cut-throat competition among broadcasters to have cricket in their bouquet,motivated by advertisers looking for a universal platform to win over the growing Indian consumer market. If it were Coca Cola and Pepsi or LG and Samsung wanting to capture the nations fancy in the earlier years,today,it is telecom operators such as Vodafone and Airtel,Idea and Aircel or DTH service providers with a similar need. And,like then,cricket remains the only platform that can deliver this promise, says Srinivas.

The popularity of the game,notwithstanding,there are several factors that have fuelled crickets commercial success in India. The first and the foremost being,the stage of evolution of the market, says Thawani. On the one hand,we have a growing economy,a booming middle class with spending power,alongside a huge market of consumers wanting to get there,and on the other,there are hungry advertisers wanting to reach them, he says.

It is clear why cricket is what it is in India.