the economic times | mumbai | friday | 8 april

Business of Brands IPL
4
THE ECONOMIC TIMES | MUMBAI | FRIDAY | 8 APRIL 2011
Bharat Bandh From Today
Focused ownership, marketing innovation and a commitment to superior fan experience help Mumbai Indians, Chennai
Super Kings and Bangalore Royal Challengers improve their brand value, says an exclusive ET-Brand Finance study
Mumbai Indians Tops the Charts, Rajasthan Royals Languish at Bottom
How They Stack Up
IPL’s pecking order is three tiered—both
on the field, and when it comes to
business. There are the runaway leaders
of the pack in Mumbai Indians, Chennai
Super Kings and Bangalore Royal
Challengers, who are setting the pace and
raising the bar. The bloated middle-order
has teams struggling to find the X-factor
and a way out of mediocrity, and then
there are laggards such as Rajasthan
Royals and Kings XI Punjab, beset by
ownership and selection issues. The
latest ET-Brand Finance study also
clearly highlights what separates IPL’s
men from the boys:focused ownership,
marketing innovation and a commitment
to superior fan experience translates into
better performance on the field as well.
Owners with a better understanding of
the game tend to choose the right player
resources, manage cultural differences
better and in general extract the best out
of both superstars and rookies. Here’s
more on the 10 IPL franchises:
RAJASTHAN ROYALS
New Brand Value Order
Brand Value of IPL Franchisees
2011
2010
Franchisee
0
Super
Kings
Royal
Challengers
Knight
Riders
Delhi
Daredevils
Deccan
Chargers
Kings XI
Punjab
Royal Challengers Bangalore
All Figures in Million $
10
Mumbai
Indians
Chennai Super Kings
45.16
35.75
36.05
33.78
20
38.76
34.44
40.85
40.55
46
46.05
55.37
48.4
57.13
Mumbai Indians
47.58
41.9
30
40.80
40
Rajasthan
Royals
Combined Trademark Value of Teams
MUMBAI INDIANS
Rank
60
50
Star Players: Shane Warne,
Shane Watson
Kolkata Knight Riders
Delhi Daredevils
Hyderabad Deccan Chargers
Kings XI Punjab
Rajasthan Royals
2011
2010
1
2
3
4
5
6
7
8
2
1
6
3
5
8
7
4
Brand Value Added by IPL to BCCI
2011
2010
2011
2010
$355.22
$333.35
$3.67
$4.13
Million
Million
Billion
Billion
“IPL owners can
either reform the
system inside out
or face a meltdown
in the not-sodistant future. It
might be tempting
to go back to the
comfort of business
as usual, but that is
simply not an
option for IPL’s
sustainability”
M UNNI KRISHNAN
MD, BrandFinance
India
SOURCE: ET-Brand Finance Study
Star Players: Sachin
Tendulkar, Andrew Symonds
Umpire’s verdict: May
not be the best in cricket
and marketing, but has an
edge on the governance front. Has married
social business with cricket by
partnering with five NGOs to
educate underprivileged children. That rubs off on the
brand. As does the deep
pockets of Reliance Industries. The presence of Sachin
also adds lustre to the
brand. MI is an initiative of
the Reliance Foundation.
ROYAL CHALLENGERS
BANGALORE
Star Players: Virat Kohli,
AB De Villiers
IPL Juggernaut Rolls on Sans Modi
TEAM ET
I
n his pomp, Lalit Modi the cricket impresario was more powerful than the
masterpieces he was marketing. Soon
after the successful launch of IPL,
Businessweek named him 19th on the
list of the most powerful people in
sport, four place higher than Sachin
Tendulkar. Now, of course, Modi
leads a life in exile, having been
hounded out of a multi-billion dollar
cricketing enterprise he helped create.
This is the first season of IPL without the presence of the chain-smoking, Armani-clad Lalit Modi in
the stands.
And the show will go on. He
knows that.
“The show must go on. IPL is a
world class tournament. It’s for
the fans globally. Each game will
be riveting,” tweeted Modi, now
living in London and being chased
by Indian authorities for alleged
irregularities during the first
three seasons of the popular
twenty20 tournament.
Yet, there’s no dearth of
those who miss, in hushed
tones, his ruthless can-do
spirit. “He was a marketing
genius whose primary commitment was to his investors
and stakeholders. If anybody
gave him a `100, he’ll do whatever
it took to give back at least `150,”
says an advertising honcho who
worked alongside Modi in the nascent days of IPL.
A former IMG executive points
out that Modi marketed the entire
league to potential franchise owners, and
sponsors without even a promotional video.
After all, smack in the middle of a global
recession, Modi not only sustained lucrative revenue streams for IPL but also
shipped out the six-week tournament to
South Africa at less than two-weeks’ notice.
When pressure mounted last year on
Modi to quit, franchise owners such as
Vijay Mallya stood by him, albeit briefly. “I
think Modi must be given some opportunity at some point of time to explain himself," he had said at the time.
But now, those in the establishment say
the show will go on unhindered. “There is no differThis is the
ence to the IPL as a product.
first season
The strong cricketing acof IPL
tion at the heart of its sucwithout the
cess is as exciting as ever,
presence of
and we are building on the
the chainback of the success of the
smoking,
first three seasons,” IPL
Armani-clad
CEO Sunder Raman says.
Lalit Modi
Raman himself was hired
by Modi and once beamed
about being the first “professional” employee in a bureaucratic cricket board.
Some BCCI officials say IPL is more decentralised under the new regime.
Earlier, IPL used to make many logistics
arrangements for the teams including arranging the cheer girls and deduct the cost
from the franchisee fee, one official said.
“Now all decisions and arrangements are
made by the franchisees who enjoy greater
flexibility,” he says.
An ET-Brand Finance study has reported
a 11% drop in IPL’s value and attributed it
to governance issues. Could it also be due
to the missing Modi enterprise?
"If Modi had been here, it would have
Tickets to Cost More
Meenakshi Verma Ambwani
NEW DELHI As the Indian Premier
League’s fourth season begins, franchisees expect to rake in higher ticket
revenue as they have increased some
of the top-end prices by 20-35% while
trying to keep the lower-end tickets
affordable for cricket buffs. PB Vanchi,
director of GMR Sports, which owns
Delhi Daredevil, said that overall a
15-20% increase in ticket prices has
happened. "One cannot increase the
prices drastically as it is meant for the
team’s supporters and fans and needs
to be affordable," he said. Match
tickets start from `220-300 for the 10
teams, with most of them available at
the ticket sale points at the stadiums.
been good for IPL. But if he's not here, then
also IPL continues to be the institutional
platform for cricket that it has been,” says
PB Vanchi, director, GMR Sports, which
owns the Delhi Daredevils.
Shamsher Singh, a former cricketing
manager at Rajasthan Royals and one-time
Modi associate, says the euphoria over
India’s World Cup win may help IPL temporarily tide over Modi’s loss. But in the
long term, Modi will be missed.
“He created IPL, whereas those at the
helm have merely inherited a going concern. In Modi’s absence, the real test will
come when the car has a flat tyre,” he says.
Umpire’s verdict:
According to some, the
biggest beneficiaries of
Lalit Modi’s benevolence,
and hence the legal troubles it faces. Winners of
IPL 1, but how long can it
ride on captain Shane
Warne’s magic. Also
Jaipur isn’t the most
cosmopolitan of
cities to house a
high-profile sporting franchise.
KOLKATA KNIGHT RIDERS
Star Players: Gautam Gambhir, Jacques Kallis
Umpire’s verdict: Made an impact by
innovating in fan engagement, merchandising and ticketing. Has made substantial
investments in developing corporate
stands to create a world-class experience.
As a result, margins on gate receipts were
higher than any other franchisee. The
Whyte & Mackay Corporate Lounge and
Royal Challenge Stands fetched some of
the highest ticket prices. Has heavily
invested in digital outreach.
Umpire’s verdict: Shah Rukh Khan’s team
was tipped before the first ball was
bowled to be the most profitable. Sadly
the team’s performances haven’t lived up
to its owner’s passion and energy levels. If
it is still at No 4, it may have a lot to do
with the owner’s charisma. It may not last
too long, however, if the team keeps
underperforming.
DELHI DAREDEVILS
Star Players: Virender
Sehwag, Irfan Pathan
Umpire’s verdict: Has
always been a formidable team on paper, what
with Virender Sehwag
leading the attack, but
success seems to constantly elude the GMR
Group’s team. Fares
poorly in marketing
and in engagement
with fans.
DECCAN CHARGERS
Star Players: Sangakarra, Dale Steyn
Umpire’s verdict: Wildly varying
performances on the field. Laggards one
year, champions the next. Owners Deccan
Herald have been unable to unlock the
true potential.
KINGS XI PUNJAB
Star Players: Adam Gilchrist, David Hussey
Umpire’s verdict: Found itself in a
regulatory mess at the end of
Season 3. Some of its owners want
to sell out, others want to hang
on. That never bodes well for a
business or a cricket team.
The Newcomers
KOCHI TUSKERS
Star Players: Mahela Jayawardene, Muralidharan
Umpire’s verdict: Will
face an uphill task in
recovering costs as it has
been embroiled in controversies since inception.
Ambiguity regarding its
ownership structure has left fans agitated
and dissatisfied. Further, Kochi does not
have a large metropolitan area from which
to establish a large fan base and hence
marketing and fan engagement
initiatives needs to be far more intense.
CHENNAI SUPER KINGS
Star Players: M S Dhoni,
Suresh Raina
Umpire’s verdict: The champions
of IPL 3 are the most consistent.
Captained by MS Dhoni, who a few
days ago led India to a World Cup
title. Team composition has also
been consistent with minimal changes, which will go
a long way in creating a
loyal fan base. For owners India Cements, there
is a huge opportunity to
leverage the CSK brand.
Only downside: Company’s VC & MD is also a
BCCI member, which
could lead to
conflict of interest.
PUNE WARRIORS
Star Players: Yuvraj,
Robin Uthappa
Umpire’s verdict: Better placed
amongst the newcomers as it
can tap into a catchment population across Maharashtra. It
has one single owner, the
Sahara group. Another
advantage for Pune is its
state-of-art cricket
ground.
Compiled by Team ET, with
inputs from Brand Finance