Title sponsors Vivo set to exit IPL
Move could be prompted by anti-china sentiment running high; BCCI plans to find new sponsor for this edition
MUMBAI/NEW DELHI: Chinese smartphone makers Vivo are set to withdraw as title sponsors of the upcoming IPL, according to BCCI sources.
The BCCI top brass were locked in teleconferences through the day to find an amicable settlement with Vivo, who signed a ₹2,291 crore deal in 2017 that was to run till 2022.
The BCCI is planning to float a tender to invite a new title sponsor for just this year, for the league that begins September 19 in the UAE. The move came days after the Indian board confirmed that Vivo will remain the title sponsors of the IPL despite growing clamour against Chinese investments in India since 20 Indian Army personnel were killed on the Indo-china border in Galwan, Ladakh, on June 15.
POSSIBLE RETURN
“They could return next year to complete the remaining threeyear deal, which would be extended by a year to 2023, if India-china relations improve,” a BCCI official said.
However, those well versed with contract matters say, if force majeure clause is invoked, Vivo’s return will be determined by a new contract based on market realities of the day.
A Vivo spokesperson said, “We neither accept or deny
2008-2012
2013-2018
2016-2017
2018-2022
DLF
Pepsi*
Vivo
Vivo**
*(Pepsi quit in 2016 following the fixing and betting scandal) **(Vivo’s offer was way higher than Oppo’s ~1432cr, the next highest bidder. Vivo and Oppo come under the same parent group—bbk Electronics.)
Vivo is the title sponsor of Pro Kabaddi League.
The five-year-deal, signed in 2017 was for
Dream11 is an official partner of Indian Super League
the news. We will issue a statement once there is clarity on the situation.”
On June 19, IPL’S official handle tweeted, “Taking note of the border skirmish that resulted in the martyrdom of our brave jawans, the IPL Governing Council has convened a meeting next
PV Sindhu till 2022 Kidambi Srikanth till 2022 Parupalli Kashyap till 2020 Manu Attri and till 2020 B Sumeeth Reddy (doubles)
Indian startups Dream11 and Swiggy, which have Tencent as primary investor, are official partner and associate sponsor of BCCI and IPL. Tencent’s headquarters is in Shenzhen, China.
Indian startup Paytm, title sponsor for international and domestic matches in India, has China’s Alibaba Group as its primary investor.
Byju’s, an Indian startup with investments from Tencent, is the main shirt sponsor of the India teams.
week to review IPL’S various sponsorship deals.”
In the IPL governing council meeting finally held on August 2, members were told that there was no change in title sponsors. After the meeting, the IPL’S new dates and move to the UAE were announced, with Vivo’s
Till 2021
+ free kit name in the title. Behind the scenes, said a BCCI official who did not wish to be named, president Sourav Ganguly and secretary Jay Shah were in talks with Vivo, because the Chinese company wanted to withdraw to “renegotiate the valuation.”
When Vivo first joined the IPL bandwagon as title sponsors (2016-17), they had bailed BCCI out by filling in for Pepsi, who had exited the league following bad press over a spot fixing scandal. Vivo reportedly paid around ₹100 crores a year for two years (2016-17), before they signed the current deal, which, the BCCI said, was “a 554 per cent increase over the previous contract.”
Chennai Super Kings CEO Kasi Vishwanathan said that they had been “hearing rumours” but, “as far as the financial impact of Vivo’s exit from the IPL is concerned, let the BCCI declare it first and then we can deliberate on it.”
FINANCIAL FALLOUT Another IPL franchise official, who did not wish to be named, was concerned about the financial fallout. “One of our demands has been to be compensated for the loss of gate receipts,” he said. “Now, if the central pool will get affected due to Vivo opting out, it will hit us hard. We hope to have a dialog with BCCI.”
Vivo’s deal as well as that of Star’s broadcast rights contract for Indian cricket, worth ₹3,270 crores a year, meant the IPL revenue pool went up and the franchises began making a profit upward of ₹150 crores each season. Industry experts feel that while the BCCI will be able to find a sponsor at such short notice, the deal may not be as good as the one with Vivo.
“The BCCI won’t get a sponsor to cover the ₹440 crore that Vivo would have paid,” said Lloyd Mathias, marketing and business strategist and former Asia marketing head of HP.
“They will have to make do with a reduced price, given the limited time on hand and also the fact that many brands have been severely impacted by the lockdown.”
What may work in the BCCI’S favour is that the IPL will be the only Indian sporting tournament at a time when all sports is at a standstill in the country.
“Viewer interest will be extremely high,” Mathias said. “In comparison to previous years TRPS may be as good if not better. This may influence potential sponsors decision to bid for the IPL at this late stage.”
Harish Bijoor, brand strategist and founder of Harish Bijoor Consults, said that Vivo’s exit was an astute move.
“VIVO certainly realised that popular sentiment is against its sponsorship this year. Therefore they requested to move out of the tournament this year and come back next year to complete the contract,” Bijoor said. “This is a face-saver for BCCI and the IPL. Vivo has done the correct thing at this point of time.”
With Vivo’s exit, and with the IPL being staged outside of India in the middle of a pandemic, BCCI and its new president Sourav Ganguly have a tough challenge to overcome.