Industry POV

T20 dominates as sports broadcasting ad rev almost touches Rs 3,000 cr in 2016

03 Jan 2017

MUMBAI: Advertising revenue from sports broadcasting could have neared Rs 3,000 crore (Rs 30 billion) in 2016, the first half of which was dominated by a string of T20 cricket matches.

The double-digit ad growth was led by cricket while leagues in various sports like kabaddi also contributed. The T20 supply in the first half of 2016 included the three-match India vs Sri Lanka series, the Asia Cup, the Twenty20 World Cup and the ninth edition of the cash-rich Indian Premier League (IPL)

Although 2016 saw leagues in various sports like badminton, kabaddi and soccer take place amid fanfare, it was the bat-and-ball game that continued to dominate the sports arena.

Dentsu Aegis Network South Asia chairman and CEO Ashish Bhasin noted that sports ad revenue was up by 10% in 2016 and that the genre was still cricket dependent.

“While there has been a lot of talk and hype about leagues in sports like wrestling, kabaddi, badminton, the reality on the ground is a little different. Cricket still takes 85% of ad monies. Non-cricket in terms of actual spend has not captured more than 10–12% of the market.”

Though there was a lot of cricket right from January, fatigue was not an issue. Team India did reasonably well, reaching the semi-finals of the T20 World Cup, for instance. Bhasin put the non-cricket ad pie at Rs 500 crore and cricket at Rs 2,500 crore.

“Sports leagues have launched, and their performance has been a mixed bag. But how the sports genre has fared depends on how cricket has fared. Cricket fared well this year. Cricket gets mass viewership in an impactful manner,” he asserted.

The ninth edition of the IPL earned ad revenue of Rs 1,100 crore from its telecast. Sony Pictures Networks India (SPNI) is the official broadcaster of the IPL.

SPNI president Rohit Gupta noted that non-cricket properties started to attract advertisers much more in 2016. “There is a catch-up happening in India. Globally, sports as a genre is attractive for advertisers because it is associated with stickiness. The same thing is happening in India. It is an encouraging sign that advertisers are putting in money into non-cricket as well. We saw a good response to our properties whether it was La Liga, NBA or Uefa Euro.”

Gupta added that brands that target males cannot afford not to be on sports. “Local leagues expanded the market. Categories like FMCG, auto and e-commerce continued to use sport heavily. Brands were more open to using sports beyond cricket compared to three years back,” he said.

Madison Media Group COO buying Neelkamal Sharma pegs ad revenue growth to be modest. “Given that 2016 had T20 World Cup and the Asia Cup, its revenue will be about 8–10% higher than 2015,” he said.

Sharma also does not feel that non-cricket will make much of a dent in terms of their ad revenue share. “While non-cricket is gaining momentum slowly but steadily, thanks to leagues like the ISL (Indian Super League), PKL (Pro Kabaddi League), PWL (Pro Wrestling League) and HIL (Hockey India League), cricket still continues to rule the sports pie with a lion’s share and will continue to do so for few more years.”

At the same time, advertisers are getting more interested in non-cricket leagues. “Some advertisers find it as an opportunity to associate with these leagues as they can associate their brands with both on-ground and on-air. They get larger brand association in low-clutter environment at much lower investment commitment. For example, TVS and Hero have done it very successfully with these leagues. Also, many new brands associating with these leagues are on the rise, but it should be for a longer period and not just one year for sure,” he stated.

Another issue is how cricket fares compared to competition like the Hindi general entertainment channels (GECs). “Hindi GECs and movies will continue to deliver higher ROI in short terms, but cricket always offers faster reach build-up, low ad-clutter platform, and that too among light TV viewers. Hence, effectiveness is really the key, especially for new launches where cricket is used as a great media opportunity for building quick awareness. It always pays off to brands that have a male skew.”

In terms of media buying strategy, Sharma pointed out that many advertisers buy events depending on their campaigns and if any event could be relevant for a particular campaign. “Many a time, either sports broadcasters and/or advertisers feel that dealing with these properties together will create a win-win situation for both stakeholders,” he stated.