MUMBAI: They may be led by Indian captain Virat Kohli, the superstar of the cricket world, but consistent on-field failure of the Royal Challengers Bangalore, which has seen them miss a playoff berth for the last few years, has now cost them a fall in brand value to the tune of 8%, as per an annual survey conducted by Duff and Phelps on the IPL and its teams.
A report of the survey for the 2019 IPL (a copy is with TOI), RCB, which sacked its entire coaching staff after another disappointing season, is now worth Rs 595 crores. A team sharing similarly poor fortunes due to below par performances on the field is the Shah Rukh Khan owned Kolkata Knight Riders, who too have lost 8% of their brand value, and are now worth Rs 630 crores. Like RCB, KKR, perhaps hampered by internal rift amongst the players, too failed to make it to the playoffs in the IPL this year.
“KKR and RCB have seen their brand value erode primarily on account of their below-par on-field performances, with both franchises shedding approximately 8% of their brand value. However, both continue to be backed by loyal fan bases and the presence of Shah Rukh Khan and Virat Kohli respectively, who continue to carry each brand on their shoulders. This is particularly so for RCB, who, if not for Kohli, would’ve seen a significant erosion in its brand value in the last couple of years,” says a release by the company on the survey.
The overall value of the IPL has soared by 7% -from US$6.3 billion to US$6.8 billion. In INR terms, the IPL ecosystem value has increased by 13.5% – from Rs 41,800 crores to Rs 47, 500 crores. An increase of 20% in advertising revenues this year and the recently renewed PayTM title sponsorship deal (which has fetched an increase of 58% on a per-match basis over the last deal) reflect the continued popularity of IPL.
While RCB and KKR have suffered a slip in brand value, the Chennai Super Kings, who won the 2018 IPL and reached the final in 2019, have seen a massive gain of 13.1% in their brand value to Rs 732 crores, propelling the team to the No 2 spot in our brand rankings. “Though CSK saw its brand value erode due to the two-year ban imposed on it, it seems to have recovered on back of continued on-field success coupled with a pan-India fervent fan base and Dhoni’s charisma,” says the release.
The leader amongst the franchises, of course, continues to be the Mumbai Indians, who clinched their fourth IPL trophy this year. MI’s brand value went up to Rs 809 crore up – an increase of almost 8.5% from last year. This is the fourth consecutive year that MI are topping the charts in terms of brand value.
The team making steady gains in recent years is Sunrisers Hyderabad, the youngest franchisee in IPL. There was some good news for the Delhi Capitals too, whose brand value, on the back of a decent IPL this year, saw an increase of 9%.
Santosh N, Managing Partner, D and P India Advisory Services LLP, a member of the Duff & Phelps network, said: “This year, the Mumbai Indians (MI) and Chennai Super Kings (CSK), continued their absolute dominance with MI winning their fourth IPL title. Their consistent on-field performance has made them fulfil the dreams of their sponsors and advertisers resulting in a year-on-year increase in their brand value. On the contrary, Royal Challengers Bangalore (RCB) and Kolkata Knight Riders (KKR) have shed some of their brand value this year demonstrating that big city bases and marquee players are not the only factors influencing brand value; consistent performance on the field also matters.”
Varun Gupta, Asia Pacific leader for valuation advisory services and India country leader, Duff & Phelps, said, “Our IPL brand values report reflects the evolution of the modern cricket business paradigm. As we move into the second decade of IPL, the league has transitioned from being a startup to being a more mature, stable and profitable business. An increase of 20% in advertising revenues this year and the recently renewed PayTM title sponsorship deal (which has fetched an increase of 58% on a per-match basis over the last deal) are testaments to the continued popularity of IPL. This has resulted in a steady increase in the value of the ecosystem (which grew by 13.5% in INR terms). However, for growth trajectories to maintain their momentum, all teams need to focus on their on-field performance while continuing to broaden their footprint, forge relationships and generate revenue opportunities in growth markets.”