Vivo’s IPL exit opens door for sponsors at a discount
The surprise exit of Vivo from the 2020 edition of the Indian Premier League has left stakeholders nervous about its business impact. While the Board of Control for Cricket in India (BCCI) is expected to launch a formal hunt for Vivo's replacement, buzz is that Amul, Amazon and Reliance Jio could be tapped for title sponsorship.
BCCI officials clarified on Tuesday that the cricketing body was looking for a one-year replacement only for Vivo and that the latter could make its way back next year in a fresh deal.
R S Sodhi, managing director, Gujarat Co-operative Milk Marketing Federation (GCMMF), which makes the Amul brand of products, said his firm was interested, provided the price was right. “We are big investors when it comes to sports. And IPL is a huge property. It is also happening in the festive season, an important period for us. However, cost implications have to be kept in mind all the time,” he said.
Vivo was forking out an annual amount of ~440 crore towards its title sponsorship of the IPL since 2018. The contract with Vivo was to conclude in 2022. Experts say a sponsor replacing Vivo would be averse to paying even half of what the smartphone player was coughing up annually.
A senior media agency head, who tracks the business of cricket closely, said BCCI would get nothing more than ~150-160 crore — a markdown of over 60 per cent compared with what Vivo was paying. Some experts say BCCI may aim for ~200-250 crore as title sponsorship and may even split it between two partners, if required.
Ashish Bhasin, chief executive, APAC and chairman, India, Dentsu
Aegis Network, said those interested in IPL title sponsorship would have to keep in mind that the tournament is only a month-and-a-half away. “There are a number of factors to be kept in mind. The biggest is the time frame. The IPL is happening in the UAE next month. The window for preparation, therefore, is very short,” he said.
Bhasin also said IPL title sponsorship involves significant investment in terms of brand building and that one season may not be enough to achieve this objective. “If you look at the history of the IPL, there have been only three title sponsors, including DLF, Pepsi, and Vivo, in 12 years. Those keen on title sponsorship in the future will look to build a long-term relationship with the property,” he said.
Vikram Sakhuja, partner and group CEO, Madison Media & OOH, said Vivo’s exit has not taken the sheen off
the IPL brand and that there will be sponsors willing to invest. “It is the only live sporting event from an Indian perspective that is happening this year, and in the festive season. The window of opportunity this presents for advertisers is significant. I don't think brands will want to miss out on the action in anyway,” he said.
However, Chinese brands such as Xiaomi, Oppo, Oneplus, and Realme, which were preparing their media plans for the festive season are now likely to dial down their marketing initiatives around IPL in view of the strong anti-china sentiment.
Shripad Kulkarni, media industry expert, said that he saw advertising and sponsorship rates coming under pressure because of Vivo's exit. “Festive season demand would be key. If festive advertising picks up, IPL ad rates would not be affected,” he said.