Brand value of Indian Premier League slips amid COVID-19 pandemic
What's the story
In a huge development, the brand value of Indian Premier League (IPL) has slipped for the first time since its inception.
According to a report by Duff & Phelps India, the cash-rich league saw its value dipped in the pandemic-hit 2020.
The value fell by 4 per cent (Rs. 45,800 crore) from Rs. 47,500 crore, largely due to exit of title sponsor VIVO.
IPL 2020
The tournament was held in the UAE
The thirteenth edition of Indian Premier League was shifted to the United Arab Emirates (UAE) amid COVID-19 pandemic.
Notably, the tournament was played across three venues behind closed doors.
Other factors that contributed to the decline in IPL brand value are additional costs involved to create a secure bio bubble, the lack of gate receipts and reduced food and beverage revenue.
Impact
IPL value declined, viewership surged
Santosh N, external advisor at Duff & Phelps India, said, "Similar to the impact on other businesses and economy, the pandemic led to a decline in the IPL ecosystem value."
"However, with people forced to spend time at home, there was an increase in IPL television viewership. The 2020 edition was a huge success for broadcasters as it broke viewership and advertising revenue records."
Performance
Performances of some teams also had an impact
The on-field performances of some teams also brought down the league's value.
Notably, the Chennai Super Kings failed to reach the playoffs for the first time since the inaugural season.
According to a Duff & Phelps Indian Premier League Brand Valuation Report 2020, the IPL ecosystem's value in 2020 dropped by 8.7% since 2019, to $6.2 billion.
Information
IPL 2020 had lower sponsorship revenues
In 2020, the IPL saw lower sponsorship revenues as compared to previous years. Interestingly, Dream11 paid Rs. 222 crore for the season as compared to VIVO's canceled contract of Rs. 440 crore per season for the IPL title sponsorship.
Situation
The additions will improve the plight
"The addition of two more teams along with the number of matches that will be played will have a positive effect on the brand value of the league," said Santosh.
"While a lot will depend on the BCCI's decisions, such as, the number of matches to be played with players facing a busy calendar, we expect sponsorship deals to be back to pre-pandemic levels."