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India's sports sponsorship grew to Rs 51,854 million in 2015; PayTM, Hero, CEAT and MRF emerge as big spenders

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MUMBAI: For those you are into sports, be it for the love of the game or love of the business that revolves around it, the welcome news is that  India has set itself to become a sporting nation that thrives not only on cricket but number of other sports as well. India with a thriving culture around sports is not a distant mirage but a near reality. The figures in the  3rd edition of Sporting Nation In The Making - III is a testament to this growth.

This comprehensive report compiled by GroupM’s entertainment and sports arm ESP Properties and SportzPower shows that sports sponsorship in India has grown from Rs 46,165 million (Rs 4,616.50 crore) in 2014 to Rs 51,854 million (Rs 5,185.40 crore) in 2015 accounting for 10.4 per cent of the total Indian advertising expenditure. That is a  whooping 12.3 per cent growth.

ESP Properties business head Vinit Karnik emphasised how sports can be harnessed as a successful communication medium by brands. He said, “There is definitely a cultivated sense of understanding between corporate sponsors, sports teams and federations. A symbiotic marketing relationship has emerged within the sporting ecosystem in India. 2016 will be fantastic for not only players and federations, but also for brands and spectators, with a deeper engagement with sporting properties.”

Despite the challenges, ICC World Cup managed to garner Rs 5000 million (Rs 500 crore) in advertising revenues in 2015. On air sponsorships over all increased by 6.8 per cent YoY from Rs 25,180 million (Rs 2,518 crore) to Rs 26,900 million (Rs 2,690 crore). Out of which, 30 to 35 per cent was contributed by the emerging sports in India, while cricket took the bulk of the share.

Interestingly, only  30 percent of the growth came from On Air deals, while the rest of the 70 percent came from  on ground sponsorships, team sponsorships, franchise fee and athlete’s brand endorsement deals, with on ground seeing  most of the action. It grew by 30 per cent from Rs 7948 million (Rs 794.80 crore) to Rs 10,305 million (Rs 1,030.50 crore).

Though cricket bit the biggest chunk off this sponsorship pie, emerging sports leagues were the real growth drivers. Going by the figures roughly 51.38 per cent of the on ground sponsorship share was cricket’s contribution while the rest was all emerging sports.

“Sports other than cricket have successfully established themselves in terms of revenue and fandom within the Indian sporting firmament,” SportzPower co founder Thomas Abraham shared. “Sports like kabaddi andfFootball have massively increased sponsorship revenues in 2015 and we saw return editions of sports like tennis and hockey as well. The successful launch of the Pro Wrestling League bodes well for 2016, which will see the advent of more franchise based leagues. We expect 2016 to be a good year for cricket as well as other sports, generating ad spends and clocking in corporate investments at an exponential pace,” he added.

Infact, football saw an amazing 91.6 per cent sponsorship growth from the previous year valuing it at Rs 1140 million (Rs 114 crore) in 2015.  The biggest success story is perhaps Pro Kabaddi League, which grew by 300 per cent YoY and clocked at Rs 480 million (Rs 48 crore) in on ground sponsorship deals without a title sponsor. As per Karnik, it was a clever strategy by the broadcaster to not lock down their title sponsor and raise the bar for the next season.

eCommerce brands took the lead as top spenders in the total ad spends on sports in 2015, followed closely by automobile brands. PayTM, CEAT Tyres and MRF Tyres together contributed Rs 1078 million (Rs 107.8 crore) per year, increasing cricket’s on ground ad spends by 14 per cent.

Endorsements played a huge role in upping the sponsorship ante in 2015 with the sector seeing 27 per cent growth. The biggest endorsement deal was undoubtedly Tata Motors’ bringing Lionel Messi onboard on a two year deal of worth Rs 600 million (Rs 60 crore) per year. 2015 also saw Virat Kohli entering the Rs 1,000 million (Rs 100 crore) endorsement club that God Of Cricket Tendulkar and MS Dhoni earlier ruled.

“Women are ruling the endorsement game when it comes to non-cricketing sports,” said Karnik. “Between Saina Nehwal, Sania Mirza and MC Mary Kom, the ladies share almost 40 per cent of the endorsement spends in the market with over 10 brands in each player’s kitty.” Abraham credited their sophisticated and enthusiastic engagement of fans over social media to be the driving factor apart from their continued  good performance throughout the year.

The stress on digital, and social engagement is reiterated by both Abraham and Karnik as critical to players and teams as stats show that 70 percent of fans bring mobile phones to the stadium to share their experience, while 46 percent of mobile internet users search for sports related news and content online.

Karnik calls 2016 to be the year of the fans and points out two key trends that will drive growth in the sector. “Now that we have sowed the seeds of a sporting nation in India, 2016 will see a great synergy between broadcasters, association's, franchise owners, players and all other stakeholders to come together to build a culture around sports and build the fanbase. Secondly longer seasons or play for they sport will give more opportunities for brands to engage with the fans,” shared Karnik, adding that Pro Kabaddi League will see two seasons this year. Abraham on the other hand names volleyball to be the next big entrant in emerging sports league scene, which will launch with three separate sub-leagues to its name -- beach volleyball, men’s volleyball and women’s volleyball league.

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