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A cash hat-trick

Surajeet Das Gupta

Sony TV managing director Kunal Dasgupta took a risk when he bet the company on the fortunes of the Indian cricket team. Now that gamble could be paying off in a bigger way than he ever expected. As the ICC Knock Out series draws to a thrilling climax, the entertainment-cum-sports channel is pulling in more viewers than ever before.

Already the number of cricket fans switching on to watch the ICC Knock Out series is 32 per cent higher than the numbers who watched the NatWest one-day series earlier this year. But with India now storming into the finals, after snatching a thrilling victory against South Africa this week, Sony is certain that viewership numbers will hit a record high on the idiot box. And buoyed by the rush to buy airtime, the channel is planning to hike spot rates by at least 25 per cent for the World Cup next year.

Of course, Sony - which has bought the satellite TV rights for two World Cups at a staggering $550 million - is not the only giant corporation that is putting bigger bets on cricket than ever before. A brace of companies - from large multinationals like Pepsi, LG and ICI India to desi bigwigs like Bharti, ICICI and Asian Paints amongst others - are pouring in a whopping Rs 1,200 crore (Rs 12 billion) into cricket in 2002-03 to woo Indian customers.

The cash is being poured into a range of activities, from buying airtime in cricket matches, sponsorships, endorsements and buying TV rights of matches.

Leading the pack are companies that are forking out over Rs 500 crore (Rs 5 billion) in the next few months to buy airtime. As a result, many companies are shifting a large part of their ad and promotion budgets to buy airtime during cricket matches.

Take telecom giant Bharti Group that expects to spend over 40 per cent of its ad and promotion budget this year on cricket. Last year, it spent only 25 per cent on the game. Says Hemant Sachdev, director, Bharti Group: "The reason for the shift is simple - buying airtime on cricket is the most cost-effective way of reaching audiences because of the tremendous viewership."

Not to be left behind on the highway is Hero Honda - one of the global sponsors of the World Cup - which will spend 80 per cent to 90 per cent of its ad budget in the next six months on cricket. Beverage major Pepsi has virtually doubled its sponsorship budget on cricket as a percentage of its total advertising and promotion budgets. This year, Pepsi has earmarked 20 per cent of its total advertising and promotion budget on sponsorship compared to the usual 10 per cent in other years.

Even consumer electronics major LG is more than doubling the money that it forks out on buying airtime, from Rs 15 crore to Rs 35 crore (Rs 150-Rs 350 million). That's on top of another $10 million (Rs 50 crore) that will largely come from the Indian operations to be the global sponsor of the World Cup 2003. Their rival in the marketplace, Samsung, is pouring in Rs 35 crore (Rs 350 million) till the World Cup, compared to a negligible amount last year.

Mid-sized companies too are digging deep into their pockets to make sure they have a place on the pitch. Dr Morepen, which has big ambitions in the pharma business, is putting in about 15 per cent of its advertising budget into buying airtime on cricket programmes. For instance, it is one of the key advertisers on Doordarshan for the ICC Knock Out series where it is pushing its over-the-counter products like Burnol and Dab, amongst others.

The television channels, of course, can hardly believe their luck. Doordarshan, for instance, is believed to have sold airtime to media buying houses for the forthcoming India-West Indies series being played in India for an astounding Rs 54 crore (Rs 540 million) - which industry analysts say is three times what it usually makes on Test matches. ESPN-Star, which hired Sachin Tendulkar as its brand ambassador, in a multi-crore deal is planning a series of programmes in the run-up to the World Cup with the superstar as a presenter.

Sony is, of course, cashing in and hiking rates for the World Cup that will begin in February 2003. It has already scored well during the ICC Knock Out during which it charged $5,000-$5,500 for a 30-second spot. For next year's mega-series it will be hiking the rate for a 30-second spot to $7,500. "Despite the uncertainty we were able to sell more than 90 per cent of the airtime in the ICC Knock Out. For the World Cup, space will surely be sold at a premium," says Rohit Gupta, executive vice-president and head of network sales, Sony Entertainment Television Ltd.

Sony TV is hopeful that slightly less than 50 per cent of the channel's revenue this financial year will come from cricket alone. And with female viewership going up by over 44 per cent in the first few matches, Sony is now tapping slightly different advertisers, like FMCG companies selling products geared for women, to expand its advertising base.

Cricket event management companies and public relations agencies are also jumping onto the bandwagon. Mumbai-based CMCG, a public relations outfit, last week launched SportZ - an agency that will concentrate on offering services only to corporates associated with sports. Kapil Dev is also getting into the act and has just announced a joint venture that will market sports.

Mumbai-based Percept D'Mark expects to do billings of over Rs 50 crore (Rs 500 million) from cricket alone this year up from Rs 20 crore (Rs 200 million) last year. It is in active negotiations with the BCCI to buy the rights of the National Cricket Academy (run by the Board), which has six centres and undertakes training for the future Indian probables apart from providing scholarships and support for players.

Is the Indian corporate world going a bit too crazy about cricket? Probably not. The viewership figures on television appear to justify the unbridled corporate enthusiasm. The fact is that the viewership figures aren't matched by any other category. For instance, the average TRP ratings of the average soap is not more than 3 to 5, compared to cricket which can range from 10 to 20.

Only top-notch serials like Kyunki Saas Bhi Kabhi Bahu Thi have ratings that can match those of cricket matches. Says Sachdev: "Nothing connects the audiences all across the country like cricket. What it delivers is authentic TRP ratings and one-days provide an instant format where channel surfing during advertising is minimal as audiences don't want to miss even a ball." Adds Kartik Raina, managing director, Dr Morepen Industries: "Unlike in a soap or a music channel where you can address only one segment of the audience, cricket offers a platform were you can address a larger segment of the audience."

Large viewership, of course, also translates into better sales volumes. As much as 36 per cent of Pepsi's beverage volumes come between October to March - which is not the peak season. But thanks to Pepsi's association with cricket this year through the World Cup and the Knock Out series, about 46 per cent of volume sales will be during this period.

Says Pepsico executive director Vibha Rishi: "Cricket will give us that extra push to help us in increasing volume sales in these months which are not peak season. These months require a special marketing push as in the hot summer season the key issue is not marketing but logistics."

Hero Honda, on the other hand, is using cricket mania to push its new motorcycle 'Ambition'. Points out Atul Sobti, vice-president marketing: "The product is positioned as a bike for the 20-plus male audience. That is precisely the audience which watches cricket and so we see a clear synergy." Many companies believe it is even worth spending big and becoming a global sponsor. LG Electronics, which undertook an internal study, points out that it gets 15 seconds of brand visibility on TV every over bowled (their brand is on the ground mats and in key locations in stadia).

Which, according to the company, translates into Rs 15 crore (Rs 150 million) of brand presence for the ICC tournament and over Rs 45 crore (Rs 450 million) for the World Cup 2003. Says Ganesh Mahalingam, general manager, LG Electronics: "Effectively, by being a sponsor I do not need to advertise and buy airtime at all as we get a fantastic return on our investment as the global sponsor."

Not everyone agrees. Many corporates say that the rates are simply too high. One such company is Bajaj Auto, which has picked up associate sponsorship of the ICC matches on Doordarshan.

Says R L Ravichandran, vice-president sales and marketing, Bajaj Auto: "We do have a presence in the ICC tournament. But the airtime costs are too high to go beyond marking your presence." Bajaj spends about 5 per cent of its advertising budget on cricket and has no intention of upping it this year for the World Cup at all.

Bajaj may be the odd man out. When the Indian cricket team marches onto the field tomorrow (Sunday) it may or may not be the hot favourite with the bookies. But nothing can take away from its status as the hot favourite of the corporate world.

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