Do premier domestic sporting properties such as the IPL feel the effects after international events such as the World Cup?
Sandeep Goyal, Chairman, Mogae Media (SG): I don’t think it is anything to do with either premier or domestic. The IPL is a well-established brand in itself. It has a good brand franchise. The only effect that the World Cup would have on the IPL is one of sentiment. If India wins, the sentiment around IPL too will be positive. If India were to lose at an early stage, the IPL would be hit by negative sentiment. Sentiment in many ways defines not just the mood of the nation but that of clients too. Hence, the shadow of the World Cup would largely govern advertising rates and advertising volumes.
Samar Singh Sheikhawat, senior vice president - marketing, United Breweries Limited (SSS): For this World Cup, I don’t think so. For the last World Cup, since it was held in India, and it happened at a similar time and the IPL happened right after, I think the IPL gained because India won the World Cup and since a lot of Indian players played in the IPL, there was renewed interest. This year, there are two-three things. One is that the World Cup is being held in Australia and New Zealand, so it’s very far away. Number two, the timings of most matches aren’t what they were when the World Cup was in India. Although it’s not that bad with the day night matches starting at 9 am especially when it’s on a weekend -- and somehow all of India’s matches seem to be on the weekend. I did a story about a month ago when a journalist called me and told me how she thought that corporates would advertise more during the World Cup and I thought that it would be less than what you normally see. I think that the IPL to India is the single largest sporting event. It’s bigger than the Olympics and the FIFA World Cup. Like today, Chris Gayle has come back to form so our team is very happy and that’s the kind of thing that the IPL lives for. I personally don’t think that advertising will suffer; I do not think sponsors will back off regardless of what their investments are for the World Cup. More importantly, a lot of the World Cup spends are from this year’s budget (2014-’15) and the IPL starts on 8 April, which in our financial year is 2015-’16. So a lot of companies, ours included, will incur expenditure only in the next financial year. That is a big factor and people like us plan for the IPL every year.
Will Regional and local brands dominate spending with the upcoming IPL or will the bigger brands have enough left in the tank to capitalise on the large viewing audience?
SG: Luckily, the World Cup and the IPL fall in two different financial years. Since, companies who invest in cricket were aware that the WC would be in the last quarter of the fiscal, they would have kept their ammunition dry for this mega cricket event. IPL falls in a new fiscal. Fresh budgets will be available. Using them in large dollops or not would then be a sentiment-based decision.
SSS: I think both things will happen. As I told you, the bigger brands will definitely have something because they have fresh budgets. And people who are with the IPL are there for a long term by and large. People who’ll feel the strain would be someone like a Pepsi for instance, who’ll need to do stuff around the World Cup as well as the IPL, since they are title sponsors. Pepsi also works on a December to January year, so for them the entire spend is in the year 2015, so they obviously have higher strain on their budgets. Knowing Pepsi and having worked there, the way they would do it is by seeing how far India goes into the World Cup. The longer India stays in the Cup, the more they will advertise, the more corporate sponsors from India would be interested. And frankly speaking, if you see the stadiums, they are mostly full of Indians. So, even for the ICC, it is in their interest that India stays in the Cup as long as possible. I think you will also see regional and local brands (on IPL) because we’ve been seeing them over the last few years. Especially brands that have gotten angel and VC funding. Also in totally unrelated categories like furniture with companies like Urbanladder, Pepperfry, or youth brands for instance. You will see them getting onto the IPL platform.
What impact will the Indian national team’s performance during the World Cup have on the way advertisers look at the IPL?
SG: Answered above.
SSS: I don’t think it will have an impact. The IPL is beginning to mature as a league. I really don’t think the (World Cup) performance will have a major impact since you have players from all teams playing in the league. Regardless of who wins, minus the Pakistanis (it is a shame that they are not playing in the IPL), it is a totally different format with a lot of female, children and older people walking in and the fact that it happens in India. The way we’ve been playing, I think we’ll go deep into the World Cup. I don’t think we’ll win and if we go down fighting, I don’t think people will mind that much and the viewership will be back for the IPL.
Will the IPL’s negative press deter advertisers from spending big during the tournament?
SG: Yes, the negative press, especially betting and match fixing, scares a lot of clients, especially those who are governed by strict compliance requirements in their own countries.
SSS: No, that will never happen. If anything, it feeds controversy and grabs eyeballs and in a perverse kind of way all the spenders actually say, “Man, what is the IPL without controversy.” So I don’t think that’s ever been a problem. Today for instance, Srinivasan said that he will not contest the BCCI elections which means that he’s going to continue owning the Super Kings.
Have other sports properties (HPL, Pro Kabaddi league and ISL) created enough differentiation for advertisers?
SG: I think these sports still have a long way to go. ROI is still far short of cricket. But the smarter brands are building new constituencies with small investments and side bets.
SSS: It has certainly created some differentiation, though I don’t think it has created enough. But there are definitely avenues and opportunities for investment for corporates. I think the other leagues need to give it five, seven or ten years before they can start coming anywhere close to the IPL. The biggest potential is with the ISL. It can become a very viable alternative in the next three or four years. Second I would say could be the Pro Kabaddi league but not beyond that.
With Star bagging online rights and MSM continuing with television, will this make a difference to advertisers?
SG: I don’t think this is much of an issue. MSM had the rights for all the IPLs so far but never really managed to make much of them. For the last couple of years, I think they had franchised them out to other media houses. Star on the other hand will gain by the consolidation since they are already creating destinations like Hotstar. So, it could well be a win-win as Star is likely to invest far greater money and energy in providing a superior consumer experience which will automatically result in greater advertiser interest.
SSS: Yes it will, since your planning has to now cover two mediums. Every year the online viewing of IPL matches is going up. Seamless streaming with spectrum bandwidth increase is a separate avenue for consumers to watch as opposed to television. However, I don’t think it’ll affect mainline television, at least for the bigger matches. Put together, I think more viewing will happen. So, I don’t think revenue for MSM will go down, but for advertisers, they now need to consider a lot of intervention on online as well as television.
(Published in the issue of Campaign India dated 6 March 2015.)