The Indian Premier League (IPL) is a professional Indian T-20 cricket league which has made a name for itself as the world’s largest league of its kind.
Cutting to the chase, IPL teams need to make money to balance out the billions pumped into picking the best players. To ensure that their investments do not go in vain, the team owners extract revenue from a number of sources.
The major money sources for IPL teams include sportswear sponsorships, media broadcasting partnerships, stadium ticket sales, winning prize money, team merchandising, and stadium stall rentals.
Major money sources for IPL teams
The major money sources for IPL teams include sportswear sponsorships, media broadcasting partnerships, stadium ticket sales, winning prize money, team merchandising, and stadium stall rentals. The winning team’s prize money is obviously not guaranteed for all teams, but the other sources sure are.
For instance, sportswear sponsorship for each team includes brand logo placement on the players’ jerseys, and training kits, especially in the chest area of the jersey. Brand logo placement on the stadium boundaries also come under this sponsorship, which are earned by the teams.
Media broadcasting partnership is an unwavering money-making source for IPL teams. Broadcasting revenue combines money from each of the media rights holders plus individual team shows.
Stadium ticket sales are shared between the home teams, and other entities like the cricket board and sponsors.
The winning prize money is something each of the teams will be eyeing right from the onset. Although the actual amount is not fixed and changes every season, teams can expect prize money in the tens of crores which is why owners go to great lengths to purchase ace players during the auctions even if it breaks their bank (temporarily, of course).
The next opportunity for IPL teams to make money are merchandise sales. Each team creates their own merchandising. We’re talking replica jerseys, fan apparel, branded headphones, hoodies, caps, wrist watches, the works, masks even.
IPL team merchandise is immensely popular and merchandise sales skyrocket every season which directly benefits the teams.
The last major money source for teams is to obtain rents out of stadium stalls during the live matches. Although this source is probably no longer valid due to the fact that the latest season saw a no-audience, online telecasts of the matches with fake audiences to cheer the players on; stall rentals weren’t cheap. The home team could expect a fixed revenue from stall rentals on a per stall per match basis.
Other income sources:
Among additional income sources for IPL teams, Player Trading is one activity which typically takes place when the season is halfway through. Teams utilise this opportunity to sell off players who played well during the games for a higher price than what they were purchased for in the auction.
The next additional money source for owners of IPL teams is through timely selling of their stake. Team owners buy and sell their share in the franchises at the most opportune time.
What’s in it for me?
2020’s IPL saw start-up occupancy of 65 out 120 of the franchise team sponsorships which is more than half of the big-league advertisers. Indian brands belonging to various industry niches including Gaming, Online Payments and more are fighting for sponsor space in the coming season.
In 2021, start-up sponsorships are already flooding in with JustDial (online local search engine) having already signed agreements with most of the franchise teams opening the portal for more companies like JustDial to share the limelight.
Another start-up which has already stolen the thunder this year is Studds, an automotive parts manufacturer which has partnered with Rajasthan Royals.
All in all, the opportunities for start-ups are tremendous this year to sponsor IPL teams. The path has mostly been cleared for them to shine owing to the backtracking of big league sponsors due to covid.