Companies

IPL business value dropped 22% this year

Nandana James Mumbai | Updated on January 16, 2021

Fresh innings IPL 2020 — which saw 150 new brands advertising — changed the pitch, signalling a bounceback.

Mumbai Indians tops rank in brand value growth this year

Even as Dream11 Indian Premier League 2020 broke viewership and ad revenue records, the IPL’s business value dropped 22 per cent in the wake of the Covid-19 pandemic, to $4.4 billion, according to a report by Brand Finance, a brand valuation consultancy.

Mumbai Indians (MI) is the only IPL team to have seen a growth in its brand value this year — up by 7 per cent — out of all the eight teams that played, as per the report.

Reliance Industries-owned Mumbai Indians, the five-time champion, has had its brand value grow by 69 per cent from $41.6 million in 2009, to $70.3 million now, the report added. This is a “real testament to the popularity of the players, team, management and ability to overcome difficulties along the way,” it said.

For the purposes of the valuation, the IPL has been treated as a single commercial entity, encompassing business values of all its parts, Brand Finance said in its report. “The income that the Board of Control for Cricket in India (BCCI) and the franchises will achieve, and the expenditure that each will incur was aggregated. All cross-charged income and expenditure has been ignored,” it said.

“Mumbai Indians (MI) was the only team to grow both in brand value and brand strength this year,” it said. Its core experienced group, their international experience and camaraderie they share — especially under high pressure moments — was the team’s biggest strength this year, according to the report. MI was also the top scorer in the Brand Strength Index (BSI), with a BSI score of 76.9 out of 100 and a corresponding AA+ brand strength rating.

Meanwhile, Chennai Super Kings saw a decline of 21 per cent in its brand value this year to $59.8 million, simultaneously dropping from the first to second rank – a position they have managed to hold on to largely due to the team’s legacy, the report found. The team’s BSI is 62.4 out of 100.

Kolkata Knight Riders ranked third this year, with the team’s brand value falling 12 per cent to $58.4 million. KKR’s brand strength has rapidly dropped in the last couple of years, with its BSI score falling 8 points this year to 61.3 out of 100, it said.

Sunrisers Hyderabad, ranked in the fourth position, saw its brand value declining by four per cent to $57.4 million. Delhi Capitals, ranked in the fifth position, saw a decrease of four per cent in its brand value to $52.2 million. “They are, however, the second strongest team in the ranking, with a BSI score of 70.5 and a corresponding AA brand strength rating,” it found.

At the sixth position came the Royal Challengers Bangalore, with a brand value of US$49.7 million, down two per cent). Kings XI Punjab reached the seventh spot, with a brand value of US$38.0 million, down nine per cent, it found. Rajasthan Royals, which came last, had its brand value dropping 16 per cent to US$36.4 million.

IPL continues to be a serious game changer for aspiring cricketers, the report noted. “With the auctions for the 14th edition of the IPL set to take place soon, some team owners will be undertaking serious rethinking. IPL 2020 showcased the power of teams punching above their weight – particularly Delhi Capital and Kings XI Punjab. This upcoming auction would ensure many team owners infuse some young blood into their teams as aging squads are not firing – such as the Chennai Super Kings,” it said.

IPL has now created enough momentum for the franchise teams, that they are driving their own sponsorship revenues, digital media strategies, innovative merchandising tie-ups and fan engagement - all three being the most important factors in superior brand value creation, it added.

Published on January 16, 2021

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor

You May Also Like