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Smoke screen `not injurious' to sports events

Ambarish Mukherjee

NEW DELHI, Feb. 16

THE smoke over banning of sports sponsorship by tobacco companies will not affect the sporting events and corporate India feels that at best it might pose a temporary problem.

On the other hand, sports organisers feel that there is a strong possibility that the ban will come in phases giving them time to adjust to the changing financial equations. Sports sponsorships account for only around two per cent of corporate India's to tal spending on advertising and market promotional activities estimated at around Rs 2,500 crore last year.

The Chairman of Pepsi India, Mr P. M. Sinha, said: ``I don't see the possibility of any vacuum because many new companies are coming up that will be making substantial contributions in order to gain from advertising, and sports can provide a good opportu nity. The insurance companies are coming up in a big way as well as the consumer goods companies. The IT companies are the biggest ad spenders these days for whom sports association with the upcoming generations could be of natural interest.''

``Local companies are expanding and many foreign companies coming in will find this as a very effective way to promote their brands'', he said.

``Our commitment to cricket extends beyond sponsoring tournaments. We aim at developing the game as a whole, spot new talents and help them come up. But neither the media nor the cricket board realises our commitment,'' the Pepsi Chairman said.

According to the NIIT Chairman, Mr Rajendra S Pawar: ``We are trying to work out some sort of sponsorship or something like that for encouraging school children to play chess.'' Mr Pawar, however, said the company was unlikely to sponsor other sports eve nts.

The Board of Control for Cricket in India (BCCI) officials observe that the smoke of uncertainty that had initially covered the issue of sponsorship of sports tournaments following the proposed blanket ban on tobacco companies may be cleared soon.

``There will be no sudden vacuum. Over a period of time, slowly new sponsors will come in, in phases, and the withdrawal of existing sponsorships too will be in parts, spread over a fixed period of time,'' a BCCI insider told Business Line on conditions of anonymity.

The immediate impact of the ban, according to the BCCI source, may actually be felt by the television channels as the cost for TV rights will possibly go up.

MNCs operating in the areas of consumer goods such as LG and Samsung which are already investing heavily in sports events are ready to invest more. While LG was the official home appliance supplier at the last World Cup Cricket in England, Samsung has be en investing heavily in the Olympics and Asian Games.

``There is every reason for our association with sports to go up and there is no reason why popular sports too will not come within our sponsoring ambit,'' Samsung India's spokesperson said that ``it is within the company's philosophy to sponsor teams an d even associate itself with sports such as golf and other games which do not always enjoy a very high viewership. After we have entered the Indian market in 1997, we have sponsored the Indian team for the 1998 Asian Games and the Sydney Olympics in the year 2000.''

LG's Vice-President, Marketing, Mr Ajay Kapila, said ``We are currently associated with cricket, golf and polo. Wherever there is opportunity, we are doing it and we will continue to do it. And if our association becomes more intense, we will definitely do it. If there is a need to increase our spending we will go for it.''

Asked whether in future players may be seen to be wearing the LG logo, he said that ``though there is no proposal right now, we will certainly consider it if there is a reasonable proposal.''

The Adidas India Managing Director, Mr Tarun Kunjru, said ``there is going to be some void, at least for the time being as it might take some time for the companies to respond and come together. The demand-supply scenario for sponsorship is that, there i s more supply than demand and there will be enough companies ready for leveraging by advertising through sports. But for the sports organisers, they will have to face a more competitive market.''

Adidas, which had been sponsoring tennis events, planned to hike its spending on sports this year by around 10 per cent, he said.

Mr Vijay M Crishna, Managing Director of Godrej Appliances, said ``Companies with a large product ranges will find sports an attractive option and with the ban on tobacco you will see other companies, particularly the beverages doing much more than what they were doing in the past.''

And the IT companies which have involved themselves with sports plan to increase their association. NIIT, which is already into the wise men's game -- chess -- is planning to increase its involvement in this direction further so that they can rope in th e young minds.