Sports tides over demonetisation blues: ESP Properties Study

The study released by GroupM's ESP Properties and SportzPower says the overall sports business grew by 19.33 per cent in 2016 compared to 2015. Virat Kohli emerged as King Midas of the cricketing arena

BestMediaInfo Bureau | Mumbai | March 17, 2017

The fourth edition of 'Sporting Nation in the Making', a study released by GroupM's ESP Properties and SportzPower, says that despite demonetisation hitting overall ad expenditure in 2016, the sports sector was able to ride the storm adequately. This is because most of the deals are long-term and there were no major sporting events post-November 2016 except for the Pro Wrestling League (PWL).

PWL was also pushed forward and it finally took place from January 2-19, 2017, and will be included in the next edition of the study. The reason of the postponement given by the organiser, ProSportify, was that its timelines were too close to the severe economic disruption caused by demonetisation.

Another angle to the demonetisation impact is the big expectation from IPL's 10th season. As mentioned in the report: “Paradoxically, the reason is the disruption caused by demonetisation on 2016-end, which put a big squeeze on consumption that the cricket carnival should be able to cash it on. The ?rst big release of all that pent-up demand will be seen during the IPL, is how we see matters unfolding.”

Meanwhile, overall sports sponsorship saw a 19.33 per cent growth in 2016 to Rs 6,400 crore over the preceding year. As per the new numbers, sports sponsorships accounted for 11.5 per cent of the total Indian AdEx.

ESP Properties is the sports and entertainment programming specialist arm of GroupM. The report mentioned: “Digital and offline experience are now two sides of the same coin, however there isn't any picking in terms of heads or tails – game statistics combined with video feeds need to seek out fans rather than fans seeking them out. Along with the athletes, data analytics is also influencing franchise owners, selectors and coaches to draw the best team combinations and to measure players' on-field and off-field value in a quantitative, objective manner, thus working towards a more data-driven auction strategy and execution. The Live funda will remain central in the broadcast format despite evolving to newer, multiple platforms.”

Vinit Kranik

Vinit Karnik, Business Head, ESP Properties, believes 2017 is definitely going to gain momentum in terms of the previous year's high. He said, “The report's 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.”

He further said, “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.”

Media spends being the biggest contributor grew handsomely by 24.63 per cent from Rs 2,816.9 crore in 2015 to Rs 3,510.8 crore in 2016. On-air spending in sports grew an incredible 34.74 per cent, from Rs 1,756.9 crore to Rs 2,367.2 crore. Cricket was obviously the golden egg laying duck with over Rs 1,020 crore net in ad sales revenues from IPL for Sony Pictures Network India, a good 25 per cent over 2015's numbers. For the first time, there were separate SD and HD sales for IPL. Women (41 per cent including rural) and kids dominated the viewership pie for IPL.

Multiple events of international stature such as ICC World Twenty20, the Kabaddi World Cup, and the Junior Hockey World Cup enabled broadcasters to pull in higher ad sale revenues. Media spending increased proportionately to live content duration which essentially increased in 2016 for all sports. The Rio Olympics live broadcast made technology history in 2016 -- simulcast on all eight Star Sports channels (four in SD and four in HD), the network's OTT platform Hotstar's 14 live feeds and 36 concurrent feeds with over 3,000 hours of live coverage for a record 191 million viewers.

Thomas Abraham

Thomas Abraham, Co-Founder, SportzPower, said, “A lot of women leagues are expected to flourish in the country in the near future. With increasing interest of women in sports, it can be estimated that soon the women's leagues and the junior leagues will be sold separately to the brands. Especially, the small arena sports like badminton, kabaddi and tennis attract more women.”

In 2016, the non-cricket sports witnessed 83.5 per cent growth over 2015 in terms of brand endorsements against an overall growth of 14.4 per cent across all sports. Cricket as a sport saw a commitment of 72 brands whereas together non-cricket athletes secured 82 brand endorsements. Rio Olympic medal winners PV Sindhu and Sakshi Malik contributed to the growth of non-cricket endorsements in 2016, from Rs 42 crore to Rs 77.1 crore. Virat Kohli emerged as King Midas of the cricketing arena and had the biggest part to play in cricket endorsements, rising from Rs 264.4 crore to Rs 279.3 crore in 2016.

Other sports gained a lot in 2016, across all verticals that the study focussed on. Under the on ground sponsorships, the overall figures grew from Rs 1,030.5 crore to Rs 1,165.2 crore, to register a steady 13 per cent growth; kabaddi rode forward like the proverbial dark horse and showed a momentous 154 per cent increase. Kabaddi accrued Rs 74 crore over and above earnings from the previous year due to Kabbadi World Cup and two seasons of Pro Kabbadi League. The Hockey India League (HIL) and Premiere Badminton League (PBL) were the only two sports principally driving on-ground sponsorships upwards by 15 per cent, taking the figures to Rs 257 crore from Rs 223 crore in 2015.

“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,” noted Abraham.

Cricket's gains remained high, as usual. The three new associate sponsors of BCCI – Pepsi, Hyundai and Jana Financial Services – together accounted for Rs 1.6 crore in additional revenue per match.

Across sports, overall team sponsorship grew by 25.33 per cent over the previous year. A whopping 22 new brands tested IPL waters in team sponsorship causing it to tumult forward by 9.5 per cent in 2016. Team sponsors went down marginally for ISL as well with numbers dropping to Rs 37.2 crore as against Rs 38 crore in the last year. Kabaddi saw a 45.76 per cent increase in its two-season swing – the highest by any sport.

Franchise fee pie has remained constant despite additions {Tamil Nadu Premier League (TNPL), Premiere Badminton League (PBL) and two teams in IPL} and deletions {Champions Tennis League (CTL), Chennai Super Kings (CSK) and Rajasthan Royals (RR)}. The major highlight of the year was BCCI waiving off franchise fee commitments of suspended teams CSK and RR until their return to IPL in 2018.

Under the social media and mobile segment, cricket is on everybody's mind and digital space with IPL dominating 79 per cent of social conversations and 84 per cent of searches. In terms of numbers, the International Premier Tennis League (IPTL) audience is the most digitally active sports viewer and despite its popularity, PKL has the least traction online. Mumbai Indians and Kolkata Knight Riders have crossed the 10 million mark when it comes to Facebook followers, while the only ISL franchise to have crossed one million followers is Atletico de Kolkata.

Virat Kohli leads the digital numbers. While PV Sindhu is the belle of the ball when it comes to social conversations and search volumes, Sania Mirza is the reigning queen of Twitter and Facebook.

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