Virat Kohli plays a shot during the Indian Premier League. (Photographer: Ravi Choudhary/PTI)

A Summer Of Cricket Is Set To Fatten Star India’s Wallet

Record viewership for the Indian Premier League followed by the Cricket World Cup is set to make it a lucrative summer for India’s largest sports broadcaster.

Viewership of the 12th edition of IPL—which began on March 23—rose to an all-time high, Star India said in a statement, citing Broadcast Audience Research Council of India’s PreView data. As many as 283 million viewers tuned in to the inaugural week—a 15 percent increase over the previous year. Television viewership ratings, too, rose 28 percent to a record 33.1 million average impressions. The company also said it reached 219 million television viewers across the country for the first three matches held on March 23 and 24—a 31 percent jump over last year.

That’s expected to boost ad revenue. The subsidiary of the Walt Disney Co. expects to net advertisement sales of Rs 2,100 crore—a 16 percent rise over last year—for the near-two-month-long tournament, an executive in the marketing division of Star India privy to the details told BloombergQuint. The executive requested anonymity as the person isn’t authorised to speak to the media. Then the quadrennial ICC Cricket World Cup begins on May 30. Two sponsors have already been signed up for the world cup and that the numbers—in terms of deal value—are huge, the executive said.

That comes when advertising spend is growing at a healthy pace in India. It’s expected to reach Rs 72,169 crore (nearly $10.3 billion) in 2019, a 15 percent increase over the previous year, according to the Zenith Global Advertising Expenditure Forecast. India, according to the study, will become the eighth-largest advertising market between 2018-21.

Star India—with at least 16 sports channels, including those that telecast in high-definition and regional languages—has a virtual monopoly over cricket broadcast in India. It has secured IPL’s media rights as well as that for television and digital broadcast of international and domestic cricket matches in India for five years each, for which it paid around $3.5 billion. Its online platform Hotstar will broadcast matches live to millions of subscribers, who mostly have access to cheap data plans and are fuelling an online content consumption boom.

Chennai Super Kings batsman Suresh Raina  plays a shot during Indian Premier League 2019 match at MA Chidambaram Stadium in Chennai. (PTI Photo/R Senthil Kumar)
Chennai Super Kings batsman Suresh Raina plays a shot during Indian Premier League 2019 match at MA Chidambaram Stadium in Chennai. (PTI Photo/R Senthil Kumar)

It’s this widespread reach that will be crucial for Star India to meet its advertisement revenue target, according to Karan Taurani, vice president and research analyst (media) at Elara Securities India Pvt. Ltd. “They’re looking at a number in the range of Rs 1,800 to Rs 2,000 crore from ad sales this year,” he told BloombergQuint. “If we talk about brands (advertisers), HUL (Hindustan Unilever Ltd.) has raised its ad expenditure by 14-15 percent this year.”

The broadcaster will be monitoring ad spends by brands in the IPL, to help them gauge the amount that they would be willing to spend for the world cup. That, according to the executive cited earlier, is why it isn’t clubbing ad packages for both the events. The fact that the events are being held consecutively, according to the executive, should result in increased business.

The IPL’s audience in its Hindi-speaking and south Indian markets grew 32 percent and 19 percent, respectively over last year. That can be attributed to the fact that the tournament offers commentary in seven Indian languages, excluding English. The growth in appeal among kids is partly due to Super Funday, a curated feed broadcast on Sundays, Star India said.

What It Means For Advertisers

It’s this appeal that advertisers are willing to bet on, signing up as partners for the annual event. Vivek Srivatsa, head (marketing) of passenger cars at Tata Motors Ltd., told BloombergQuint that they will spend 10 percent more on marketing initiatives during IPL 2019 over last year. The Tata Harrier is the official partner of IPL 2019. “The spend largely depends on business objectives, brand and target audience profile,” Srivatsa said, adding: “Our core effort as marketers is to generate the best return on the investments made.”

Mumbai Indians players with the IPL 10 trophy after they won the IPL 2017 Final against Rising Pune Supergiants in Hyderabad. (Photograph: Shailendra Bhojak/PTI)
Mumbai Indians players with the IPL 10 trophy after they won the IPL 2017 Final against Rising Pune Supergiants in Hyderabad. (Photograph: Shailendra Bhojak/PTI)

The automaker said that advertising during last year’s IPL helped boost its sales. Total enquiries for the Nexon more than doubled in April-May 2018 during the tournament period to 1,720 per day, it said. Tata Motors also claimed that its domestic sales in May 2018 grew 61 percent over the previous year to 17,489 units, apart from an 18 percent increase in enquiries and bookings in the seasonally weak month.

Star India executive quoted earlier said that a consumer durables company, which spent around Rs 20 crore on ad spots in IPL 2018, doubled its marketing spend this year after its sales rose. Overall, according the person, there has been a 10-20 percent overall increase in advertisement expenditure by brands this season.