IPL franchise Chennai Super Kings has been slowly and steadily building its brand over the past four years on the back of its iconic captain Mahendra Singh Dhoni. The sustained efforts of the last four years are beginning to show result as the franchise looks at a 15-20 per cent revenue growth this year.

By retaining its key players, the franchise has managed to build a loyal fan base not just in Tamil Nadu but also among the Tamil diaspora. The two time IPL champions is leaving no stone unturned as far as engaging with fans is concerned and is stepping up efforts on the merchandising front to grow this revenue stream.

In an interview with Indiantelevision.com’s Javed Farooqui, India Cements joint president marketing Rakesh Singh shares the franchises journey so far and the growth path ahead.

Excerpts:

Isn't Chennai Super Kings targeting a revenue of Rs 1.7 billion this year? What is the break-up?
We did Rs 1.40 billion last year and are looking at a 15-20 per cent increase this time. It’s difficult to give a break-up for the simple reason that a major chunk of revenue comes from the central pool. There are components in our revenue pool - one is central pool which to my mind was Rs 60 crore (Rs 600 million) plus last year; then there are our sponsors and gate collections.

Have you reached operational break even?
In the first IPL edition, we broke even. We lost money in the second season (due to shift to South Africa). While we made marginal profits in the third IPL, we widened that in the fourth edition.

How has IPL season 5 been for CSK?
The IPL season has been good for us. Our total number of sponsors have gone up. Aircel is our main sponsor. Gulf Oil is our principal sponsor and then we have Life Ok and Washington Apples as new sponsors. We also have Amrapali Group, Hercules, and Usha International as sponsors.

While our revenue continues to grow at a steady pace, what we are also trying to do is step up the merchandising efforts. We plan to grow merchandising by positioning it as a lifestyle brand so that fans not only buy CSK T-shirts during the IPL season but also wear them during the non-IPL season.

How did the deal with a Hindi GEC like Life Ok happen with a team franchise from the South?
There is a study done by one agency which says that 46 per cent of the fans support Chennai Super Kings and Mumbai Indians. Now if that is the case, anybody who wants to take full advantage of the IPL needs to come to one of us. For somebody who wants make a Hindi GEC popular, it is a nice way of riding on the popularity of Chennai Super Kings. Another thing is that while we are the most popular team in Tamil Nadu, in most other cities we turn out to be the second most popular after the home franchise. I think that is because of the kind of team that we have with four Indian players - MS Dhoni, Suresh Raina, Ravindra Jadeja and R Ashwin.

The IPL has seen a lot of sponsor switches. How did CSK manage to retain its sponsors?
We believe in consistency and that is the reason we don’t believe in changing our players. We don’t change our management and we don’t believe in changing sponsors. That has clicked because that does not confuse the fans. We treat our sponsors well and we give them a value for their money for at the end of the day sponsors look at RoI.

There are reports that title sponsor DLF is not sure of continuing its IPL sponsorship?
I don’t know about that but what I would like to say is that when the BCCI terminated the Nimbus contract, everybody was saying that the BCCI won’t get Rs 31.25 crore (Rs 312.5 million) per match. But ultimately the rights were sold for a much higher price. I think it has become a favourite time pass for everybody to talk ill of the only sporting brand that India has today.

The viewership of IPL is also going down?
I think the way to look at it is that all the 8 pm matches are doing well. If you look at the stadiums, aren’t they packed? In fact, I was surprised by the turnout at Pune. So the interest is there. While the television viewership has gone down, the Internet viewership has gone up as many people are at their workplace during the afternoon match. If the match is tight, then the interest will be there throughout - like the match we had with Royal Challengers Bangalore. So if you look at the TRPs for the CSK-RCB match, the viewership will be high.

So are the team loyalties settling down?
I think so. If you see the matches where Mumbai or Chennai are involved, the viewership will be high due to team loyalties. That is also the case globally where matches involving Man-U or Chelsea will have higher viewership as compared to other smaller teams. In the first three IPLs, most of the matches were 8 pm matches and the number of teams were less. But now we have more teams and the number of matches have gone up.

What do you think is CSK’s USP?
Our USP is that we always focus on cricket, unlike other teams who are focussed on glamour and parties. Not to say that these things don’t work but IPL at the end of the day is a cricket tournament. We have a disciplined team; so whether its on-field or off-field, our team carries a certain character. We have a very strong fan following in Tamil Nadu and Chennai in particular. As per one survey report, 96 per cent of Chennaites support Chennai Super Kings, which is the highest for any franchise in their home city. Mumbai Indians come second with 86 per cent fan support.

How did you engage with fans?
Besides youngsters between 15-24 age groups who form our vital fan base, we believe that we have also get a lot of support from families. If you look at our merchandise, there is a lot of emphasis on women and children - it’s not just the typical male cricket fan. A lot of families come to watch our matches in the stadium. To reach out to our fan base, we have also tied-up with Radio Indigo besides The Hindu and Dina Thanthi. Our media tie-ups is a cash plus barter deal. But the barter part is helping us a lot on activation. That is something that was missing last year. What it has done is bring down our marketing cost.

We also launched a new video ‘Wave your hands” which has got one lakh views within no time that it was uploaded on YouTube. We launched this campaign sometime in the first week of April, and by the third week we already have one lakh views on YouTube. Earlier we had done “Whistle podu” which was also a big hit. Every fan wants to do something to support his or her team, so that way we are channelising their energy into doing something to support the team.

How is licensing and merchandising doing?
We have been giving merchandising a big push since last year, but it takes time. For example, we got almost Rs 4 crores (Rs 40 million) through merchandise sales last year but what comes to us is only 10-15 per cent after excluding the costs. What we are seeing is that it is a good platform to engage with fans. But in terms to revenue contribution, it is only about five to seven per cent. But internationally this percentage is 60 per cent and that is what our goal is: how to grow this stream. This year we have opened an exclusive in the Chennai airport where you get all kinds of stuff. We have also partnered UniverCell for distribution of merchandise in North America and Europe.

In terms of licensing, for the first time we have partnered with Café Coffee Day to make it a hub for Chennai Super Kings fans. Similarly Park Sheraton has converted their lounge into a CSK Bar. So we want to see how these deals work and whether we can make it a yearlong thing. We are working on a fixed fee basis wherein licensees can use our name and do certain things. This year we aim to double our licensing and merchandising revenue.

How has been the response been to ticketing? There were lots of empty seats during your home matches?
There are three stands in the stadium which, due to certain clearances issues, the state government has not allowed us to use. On the rest of the stadium, we are overselling. Till we get the clearance, we won’t be able to sell tickets for those stands.

Will it not impact gate receipts?
Yes, we will lose some money. But we are running full house. So we should be able to do as much as we did last year. We normally target Rs 3 crore (Rs 30 million) per match and we have already got that much for the first two matches. Though we have less number of seats, our rate is still higher. That’s the reason our ticketing revenues will not be impacted to that extent.