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IPL may help Star India take away Rs 1,500-1,700 crore from festive ad spend

According to country’s top media planners, the Indian Premier League is likely to experience a soft season in terms of advertising as Star India is expected to earn somewhere between Rs 1,500 crore and Rs 1,700 crore as brands negotiate the pricing

As the Indian Premier League (IPL) readies to go live on September 19, certain categories of brands are likely to full throttle on their advertising spend while several big spenders in the past may go slow.

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Star India, the official broadcaster of IPL, is also likely to gain a large chunk of the festive ad spend, even though the overall season is likely to be sombre.

The tournament is set to begin on September 19 till November 10 in the UAE across Dubai, Abu Dhabi and Sharjah. This will not be the first time IPL will be held outside India.

A leading media planner said Star India is likely to clock somewhere between Rs 1,500 crore and Rs 1,700 crore as ad revenue, which is likely to be 20-30% less than last year’s Rs 2,100 crore plus ad revenue.

“Because the economy is down, a lot of advertising will go away. For many companies such as durables, festivities suit more than April-May. They are the biggest hope for IPL this year,’’ said another media planner.

Expecting a massive fall in revenue, the organisers of IPL has already agreed to carry on with the sponsorship of Chinese brands, which are facing a lot of heat in India because of the heightened border tension between India and China. Vivo is the title sponsor of the tournament.

Star had bought the broadcast rights for all platforms, including digital and international rights, for a period of five years (2018-2022) for Rs 16,347 crore. The network was predicted to break even or make a profit of Rs 550 crore this year. However, the current Covid crisis is likely to disrupt the targets and predictions.

FMCG and consumer electronics companies to lead spending

Media planners are expecting a major chunk of spending to come from FMCG companies and consumer electronics brands as the in-home consumption of goods is likely remain high till Covid flattens.

Also, brands such as beverages, which are big spenders during summer, may rework their strategy in this season.

“It would not be a season for them to invest heavily. But at the same time durables and FMCG will pump monies. So it is a mixed bag. Now, how much will be compensated is a big question because the market is very soft. Star India is likely to go into the market this week onwards,” said a leading media agency head. 

He hinted that there are chances of brands advertising a bit extra also as they seek to create additional demand.

“Putting any figures right now is very difficult. There are companies that will push advertising during festivities, hoping it may improve the economy,” he added.

IPL to eat into ad share of other broadcasters

With IPL being played during the festive season, Star India is likely to eat into the share of other broadcasters as most brands would want their money to ride of IPL, the first big-ticket tournament to be played since March.

The content-deprived audience is most likely to be glued to their TV sets and the tournament may even break all viewership records, experts said.

“The big impact could be on other broadcasters as IPL may absorb most of the festive spends. Whatever Star India may earn from IPL, whether it is Rs 1,500 or Rs 1,700 crore, will come from festive spends. It would be a double whammy for other genres whose revenues were wiped off by the lockdown in April and May and now IPL may hurt them in festivities when they were expecting to rebound,” said a senior executive of a leading media agency.

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