The Indian sports sponsorship market grew at 19.33 per cent in the year 2016 to reach Rs 6,400 crores according to a report compiled by GroupM's ESP and SportzPower.
Spending via sports sponsorship accounted for 11.5 per cent of the Indian AdEx (AdEx numbers from GroupM's This Year, Next Year 2016 report).
According to the report, both cricket and non-cricket sports contributed to this growth. The country hosted the ICC World T20, the Kabaddi World Cup and the Junior Hockey World Cup in the year.
Among the growth contributors was 'on-ground sponsorship' which grew from Rs 1030.5 crore to Rs 1165.2 crore. Team sponsorship was also up last year from Rs 558.2 crore to Rs 699.6 crore. Franchise fees went from Rs 541.3 crore to Rs 548 crore and endorsements from Rs 416.4 crore to Rs 476.4 crore.
According to the report, the biggest growth driver for sports sponsorship in 2016 was media spends. It grew 24.63 percent from Rs. 2816.9 crore to Rs. 3510.8 crore.
Even with BCCI’s governance issues last year, Indian cricket was on a high in 2016. The IPL carried forward the momentum from 2015 and had higher ratings and revenue last year. The tournament gained to reach Rs 1020.0 crore net in ad sales revenues for Sony Pictures Network India. This was a 25 per cent rise from 2015. The tournament garnered 361 million viewers, as per data provided by BARC. About 41 per cent of these viewers were women (including rural) and kids.
Endorsements overall saw a growth of 14.4 per cent. Rio Olympic medal winners PV Sindhu and Sakshi Malik contributed to non-cricket endorsements growing by 83.5 per cent in 2016, from Rs 42 crore to Rs 77.1 crore. Virat Kohli had the biggest part to play in cricket endorsements rising from Rs 264.4 crore to Rs 279.3 crore in 2016
Vinit Karnik, business head, ESP Properties, said, “The report insights are the key to devising more refined viewer engagement. Gone are the days of male dominance in sports viewership. The year’s biggest chunk of spectators came from women and kids. This is ground-breaking data for brands to take that much desired leap of faith and traverse new grounds. Cricket continues to be the poster child for sponsorships, and non-cricket sports still have a fair leap to make to match revenue. However it is interesting to focus on the mushrooming of a very defined health and fitness consciousness within the country. Young digital India is breaking barriers and creating new records especially when it comes to live feeds. Their smartphones are their all access pass to the 'insider world' of sports, sportsmen and their strengths and weaknesses. Sports start-ups are trending and the success achieved by league-based events across multiple sports indicates a strong potential to consume sports other than cricket.”
Thomas Abraham, co-founder, SportzPower, said, "Viewership data demographics have been an eye-opener in 2016,” emphasises Thomas Abraham. Demonetisation disruptions aside, 2016 was a great year for the industry and this year will be even more so. Team sponsorships may have experienced certain upheavals and newer leagues will change the sporting diaspora even more so this year. However, what remains to be seen is franchise sustenance, endorsement rates and the manner in which technology and data influence these numbers. We expect 2017 to only get bigger, not just on the back of growth from the leagues that are now up and running, but also from new kids on the block that are debuting in the year – Table Tennis being a notable one.”
The two seasons of the Pro Kabaddi League and India’s hosting of the World Cup in Ahmedabad during 2016 meant that, on-ground sponsorship for the sport grew by 154 per cent enabling Kabaddi to drive past football as the number two game in India on the money table in this aspect. Kabaddi generated Rs 122 crore, up from Rs 48 crore in 2015.
Football on the other hand de-grew by de-grown by 3.9 per cent in 2016. The report states that the IMG-Reliance-Star co-owned ISL pulled in 16 central sponsors, but the lack of clarity around the ISL and the I-League are the main reasons behind the sport de-growing last year.