Three weeks to IPL: Media agencies predict a winning season despite tough conditions

New Delhi: With IPL just three weeks away, negotiations between JioStar and advertisers are already underway, and media agencies are expecting a better season this year.

"Despite a softer business environment, I believe that IPL will be better this year," said IPG Mediabrands India CEO Shashi Sinha.

When asked if advertisers are negotiating hard due to persistent tougher macroeconomic challenges, Sinha told BestMediaInfo.com, "I doubt that there will be any major negotiation in rates, which becomes tougher to cover in the coming years. Whatever advertisers demand, JioStar will offer incentives looking at the volume."

"This essentially means they will offer various value additions, including some free inventories depending on the availability. This is how the effective rates come down in the form of incentives," he added.

A large FMCG company, which has been a regular advertiser on IPL, told BestMediaInfo.com that the demand for big-ticket events is much lower this year due to limited cash flow.

"If you take a look at the results of large businesses across categories in the last couple of quarters, their growth in terms of both revenue and volume was almost flat. Most of the large advertisers, including us, have limited budgets, and they are customizing their marketing spends to keep their businesses going. It is in this context that we are expecting JioStar to either offer discounts or attractive incentives," a senior executive at the FMCG company said.

"GDP numbers are hovering around 6.2 to 6.5%, but only a handful of companies might be growing in terms of volume at that pace. There has been a sequential decline on a quarterly or half-yearly basis in the last couple of years. How can we loosen our purse strings?" the executive quipped.

Another significant banking and finance firm, which skipped the tournament last year but is eyeing a return in the upcoming season, told BestMediaInfo.com that they are in a wait-and-watch situation and hoping for a better deal as the tournament nears.

"We skipped last year largely due to budget constraints. There are several companies that have grown so much in resources. If IPL does not fit in their budgets, they will sit out unless they are offered some value proposition by the broadcaster," said a senior executive who did not want to be named.

According to Sinha, the regular IPL advertisers will continue to ride on the popularity of the tournament.

"Having said that, they may push for some incentives in the wake of market challenges," Sinha added.

When asked about the impact of IPL coming under one umbrella, Sinha said that IPL advertising will benefit from TV and digital coming together.

"I see IPL advertising in three parts - TV, CTV, and mobile. While TV and CTV will continue to attract a premium, advertisers will be more tempted to advertise on mobile as it cuts out the spillovers with a paywall for 'loyal viewers'," Sinha explained.

According to Sinha, cricket is a good value proposition for certain categories, such as automobiles. "They may be wary of other genres, but they remain assured of live cricket viewership, and that is why they will flock to IPL. The timing of IPL largely utilizes new budgets with the beginning of the new financial year," he said.