Indian Sports marketing generated Rs 15,000 cr in 2023: GroupM ESP report

The 11th edition of GroupM ESP’s Sporting Nation report suggests that Sponsorships, Athlete Endorsements, and Media Spends by brands, have cumulatively delivered the revenue last year

This week saw the release of GroupM ESP’s eleventh annual study on Indian sports, which focused on the development of sports in the nation through 2023. The three main facets of sports that are included in the report “Sporting Nation – Building a Legacy” are sponsorships (which include ground, team, and franchise fees), athlete endorsements, and media spending. According to the research, the combined effect of these three causes generated over INR 15000cr in sales in 2023, marking a double-digit increase from 2022.

With the arrival of the new WPL after a year of IPL mania, cricket in India is still at the top in every way. However, the research also highlights the enormous potential of “emerging sports,” or games other than cricket, in the nation. Nevertheless, earnings from new sports decreased by 13% on a yearly basis, totaling Rs 420 crore. In response, the paper notes that 2023 suffered because there was no significant football tournament, in contrast to 2022.

Sports has made a name for itself as Noah’s Ark, a company that successfully navigates choppy waters to build brands throughout the nation’s product categories. India’s tremendous growth, commercialization, and impact have made it a prominent force on the global scene. Media companies in India are integrating their TV and internet services as consumer viewing habits shift. Simultaneously, sponsorship expenditures associated with international cricket matches, the Indian Premier League, and other sports are becoming to hold significant cultural value. More people are watching sporting activities, and individuals nowadays have a far better comprehension of sports.

According to the report, media conglomerates are competing with one another for exclusive rights as a result of this expanded reach. On these athletic venues, massive sponsorship and endorsement deals are being struck, offering brands enticing chances for exposure.

The report emphasizes the fierce competition for rights, stating that Viacom, through their over-the-top platform Jio Cinema, has gained significant traction in the IPL by securing digital rights for the Indian subcontinent and beyond for the 2023–2027 season at a bid value of Rs 2,3758 crore; Star Network, supported by Disney, retained the TV rights for the subcontinent, paying Rs 23,575 crore for the same period. Viacom18 paid Rs 5,963 crore to get the global media rights for Indian cricket on TV and digital platforms between 2023 and 2028.

GFX – Sponsorship Expenses for Sports

In light of this, the study includes sponsorship spend data that includes ground, team, and franchise fees as well as brand advertising expenses and endorsements from Indian sportsmen. In 2023, they collectively reported INR 15766cr in revenue, an 11% increase over the previous year.

All things considered, sponsorship spending increased by a solid 24% in 2023 compared to 2022. In just one year, franchise fees added over INR 100cr to the total, making them the largest contributor. Another positive development in 2023 regarding sponsorships is that international properties that enjoy high viewership in India—such as elite English Premier League (EPL) teams and cricket teams competing in international competitions—are drawing interest from Indian brands.

The Women Premier League debuted in 2023. The five participating franchises brought in a total of INR 4669cr in franchise fees for BCCI.

*Descending order based on bid

Spending in Sports Media

The research states that media spending for 2023 was Rs 7,494 crore, making it the largest contribution to the commercialization of sports in India. TV has remained the largest source of ad spends in this, despite the OTT, the new media darling, putting up a valiant fight. TV advertising did, however, decrease in value by Rs 886 cr in 2023, resulting in a 62% overall ad spend, down from a higher 73% in 2022.

Digital platforms saw a 40% increase in advertising expenditures over the previous year, totaling Rs 2870 crore in 2023. To put things in perspective, the research states that digital ad spends increased by INR 825cr in a single year. The survey notes that one of the reasons digital media is becoming more and more popular is because of over-the-top (OTT) content. It provides a level of ease that is not achievable with traditional TV setups. The survey also projects that, over time, customers will overcome any reluctance to accept new technology, which will further strengthen Digital’s position. Furthermore, the survey states that watching OTT on television is now facilitating group viewing in homes.

GFX-MEDIA SPENDING FOR SPORTS

The ODI Cricket World Cup, which took place in October and November over the Christmas season, was an even better alternative to the FIFA World Cup in 2023. This implied that companies ought to have invested more in advertising, and that is exactly what transpired—but at the expense of sports other than cricket. The research claims that large amounts of advertising money were transferred from entertainment shows, sports, and other similar genres to cricket. This clarifies the decline of sports other than cricket.

According to the research, 2024 will be a busy year because of the planned Olympics, T20 World Cup, and other sporting events.

Athlete Endorsements

As customers, we are accustomed to seeing athletes promote items on billboards and on our screens these days. Athlete endorsements increased in 2023; for example, cricketers’ income from brands increased by 27% in comparison to 2022. Cricket also held a strong position in this regard, accounting for 87% of all athlete endorsements through cricket-related agreements. In 2023, sports personalities from both burgeoning sports and cricket brought in a total of INR 927cr.

According to the survey, there were 536 brand endorsement agreements involving sports stars that were publicized in the previous year, with cricket players being associated with approximately 380 of them. Superstars in cricket like Rohit Sharma, MS Dhoni, and Virat Kohli are the most successful athletes to have signed large contracts. In addition to them, Neeraj Chopra and PV Sindhu are motivating sportsmen to excel in international events.

Spending for GFX – Sports Celebrity Endorsement

Together, Kohli, MS Dhoni, and Rohit Sharma agreed to represent more than thirty brands in 2018, which gave birth to the different endorsement prices of each of them. Shubhman Gill, Hardik Pandya, Jasprit Bumrah, and KL Rahul—some of the stars of the future—are listed in the report as cricket players who had significant growth in 2023, both in terms of earnings and the number of brands they supported. Neeraj Chopra had a fantastic year in 2023 with his historic triumph at the World Athletics Championships held in Budapest, in addition to his wins at several important tournaments. Indian cricket has always had a solid pipeline of upcoming talent.

He currently has 16 brands in his portfolio as he pursues his global winning endeavors. Cricket for women has becoming more popular. Smriti Mandhana, Jemimah Rodrigues, and Harmanpreet Kaur were the three female cricket players with the highest earnings.

However, emerging sports endorsements brought in a total of INR 117cr in 2023, accounting for 13% of overall revenue. An annual rise of 7 percent was observed, a far cry from the growth rates that cricket claims.

GFX: A DECADE OF SPORTING NATIONALITY

Head of GroupM South Asia’s Sports, Esports, and Entertainment division Vinit Karnik talks with IMPACT about the importance of the most recent report’s results, Sporting Nation: Building a Legacy, the WPL’s share of overall revenue, and other topics.

Unlike last year’s study, “Sporting Nation in the Making,” this year’s is titled “Sporting Nation – Building a Legacy.” In what sports has India started to ‘create a legacy’? Is this only because Cricket has been so successful?

The title of GroupM ESP’s India Sports Sponsorship Report was changed from “Sporting Nation in the Making” to “Sporting Nation – Building a Legacy” to better reflect India’s current heightened standing as a sports nation. With a remarkable CAGR of 13.3%, the Indian sports sector has grown dramatically from INR 2400cr in 2008 to over INR 15000cr in just 16 years. It’s one of the sectors in India that is expanding the fastest.

This development highlights the noteworthy growth, commercialization, and influence that the Indian sports sector has amassed over the years, solidifying its position as a prominent actor on both the domestic and global scene.

India Successfully hosted Multiple International Sporting Events

India has successfully hosted several international sporting events, including the Moto GP Bharat last year, the Formula 1 (2011, 2012, and 2013), two ODI Cricket World Cups (2011 & 2023), one T20 Cricket World Cup (2016), and the U17 FIFA World Cup (2017).

The ecology of franchise-led leagues is robust and stable. A number of other sports leagues have emerged in India, branching out from conventional cricket. Pro Kabaddi (PKL) and Indian Super League (ISL) are two examples of leagues that have sufficiently gained popularity. In addition to giving athletes a platform, other leagues like the Premier Handball League (PHL), Ultimate Table Tennis (UTT), Ultimate Kho Kho (UKK), and Prime Volleyball League (PVL) have helped their respective sports gain prominence and growth in India.

Participatory sports have become more popular, surpassed conventional limits, and promoted social interaction. With an organized industry worth more than INR 1000cr, sports like golf, cricket, and marathons have become an essential part of India’s dynamic sports culture.

In Tokyo in 2021, Indian athletes achieved a record-breaking seven medals, and in the Asian Games in 2023, they earned over 100 medals. The All-India Football Federation (AIFF) is considering a plan to host a few FIFA World Cup matches in 2034, while India has shown a strong desire to bid for the hosting rights of the Summer Olympics in 2036.

A conscious attempt is being made to leave a legacy, possibly by way of noteworthy accomplishments, cultural impact, and sports-related developmental projects. With its impact on sports growth and involvement, this deliberate strategy represents a commitment to significantly contribute to the larger societal and cultural fabric in addition to increasing the industry’s economic value.

How big of an effect did the WPL have on Indian sports’ overall earnings in 2023? Which other sports, except the Indian Premier League, have made the biggest financial contributions?

For five clubs, WPL franchises were sold for a record INR 4669.99 Crores, which is 2.5 times the IPL franchise fee from 2008. The Adani Group made the highest bid for Ahmedabad, offering INR 1289 crore. Reliance’s Mumbai Indians came in second, offering INR 912.99 crore.

Viacom offered INR 951 Crores, or INR 7.09 Cr per match, to win the media rights to the Women’s Premier League (WPL) for the 2023–2027 season. The event’s five-year title sponsorship rights were awarded to the Tata Group. Other sponsors Dream 11, Amul, and CEAT also contributed to the outstanding first season. It was a very successful year for the competition, with all five of the WPL teams selling out of their sponsorship inventory.

With total revenue of Rs 7345 crore in 2023—24% more than the previous year—sponsorship revenue saw a spike. What would you consider to be the most important three aspects in this case?

With a growth of 32%, cricket was a major factor in the 79% gain in sponsorship.

Our men’s cricket team’s favorable calendar, which included 64 international matches across tests, ODIs, and T20Is in a busy year, was a major contributing factor in this. This includes our hosting of the ODI World Cup, our trophy-lifting victory at the Asia Cup, and the finals of the ICC World Test Championships.

With more league games played, the two new teams, Gujarat Titans (GT) and Lucknow Super Giants (LSG), helped to scale up the competition to the current ten-team format. The 2023 IPL contributed over INR 3000cr to sponsorship spends (including central, team, and franchise). With the launch of the Women’s Premier League (WPL) in 2023, revenue from ground sponsorship, team sponsorship, and franchise fees increased.

Twenty-one percent of the total value, or INR 1528 Cr, was spent on sponsorships of sports other than cricket. The following will contribute to growth in 2023:

1. The Asian Games were held in Hangzhou, China, in the year 2023. Given that the games were executed flawlessly and each sponsor, the Indian Olympic Association (IOA).
2. In football as well, Indian companies have a tendency to look for value in partnerships with outside teams. Two notable instances in this regard are the partnership between Tata Gluco Plus and the Argentine Football Association, and the investment made by Apollo Tyres with Manchester United, a highly popular team in our nation.
3. A franchise-based competition featuring Pro Kabaddi (PKL), Indian Super League (ISL), Ultimate Table Tennis (UTT), Prime Volleyball League (PVL), and Ultimate Kho Kho (UKK) was successfully organized in 2023.
4. With the culture of running and accumulating many miles, marathons have shown a tendency of increasing popularity in recent years.
5. Golf was another sport that gained popularity following the Covid-related handicaps.
6. 2023 was a fantastic year for racing in the nation since it saw the successful staging of the Moto GP Bharat. Additionally, Formula E made its debut.