“According to BCCI results, the Indian Premier League (IPL) added ₹11.5 billion ($182 million) to India's Gross Domestic Product (GDP) in 2015.”
In India, cricket is more than a sport; it is a religion with a large following. Cricket has over a billion followers worldwide, according to market research conducted by the International Cricket Council (ICC), with the Indian subcontinent accounting for more than 90% of them. As a brand and in the stories it has spawned over the years, the IPL is a representation of India's "can do" spirit, of resilience, enterprise, and creativity. Star Sports, India's leading sports broadcaster, is kicking off the IPL 2021 with their latest campaign, 'India Ka Apna Mantra,' which is inspired by this idea.
The campaign is seen saluting the mindset of a generation that is redefining traditional rules of the game to tackle seemingly insurmountable obstacles through the lens of the IPL. When faced with on-field obstacles, IPL players have challenged conventional wisdom and invented their solutions. IPL has spawned many such mantras, from Rohit Sharma's thirst for continued success to Virat Kohli's channeling his aggression to be named "King" and surprisingly the mantra for the revenue generation by BCCI (The Board of Control for Cricket in India) which is yet to be decoded.
How Does IPL Generate Revenue?
1. Sponsors
The group of sponsors that the teams have is one of the most significant factors that can affect the IPL's earning system. Items that go outside the limits would almost certainly have a price tag added to them. Even the balls and bats come with a price tag. These are, without a doubt, the team's sources of revenue. Most people are aware that IPL teams often have a large number of sponsors. There are several big sponsors, as well as sponsors for the jersey and sleeves.
2. Ticket Sales
The main source of income for the IPL is undoubtedly the tickets that people purchase for sporting events these days. Every team has seven separate home games, and as a result, they have the best chances to earn money most efficiently. That is one of the most important things to remember when it comes to using the impressive IPL money generation technique to its full potential.
3. Brand Value
We can tell without a doubt that the brand has gained a lot of value as a result of the involvement of the franchise team members. The company has a large number of different players who play for various IPL teams, which certainly aids in the best possible brand value formation. As a result, there is no question that the business will be able to draw a variety of investors and other brands.
4. Merchandising
There are so many different types of products available at the company, and there is no question that customers want to purchase them.
What part does IPL play in holding the economy afloat?
There is a substantial increase in tourism during the IPL season, with a large number of foreign tourists from countries such as the United Kingdom, South Africa, and Australia. These are cricket-obsessed countries with a sizable fan base. During the IPL season, cricketers from these countries travel to India to play for various clubs, taking their fans with them, resulting in an increase in sports tourism in the country.
The uplift of tier-2 cities as a result of media attention is another significant finding of the same report. Since IPL cricket matches take place all over India, they receive a lot of media attention. Tier-2 cities profit from the IPL's media attention by investing more in their infrastructure and growth, as well as seeing an increase in tourism-related activities, which generates more revenue for the region.
Furthermore, although the IPL increased BCCI revenues, it also increased tax contributions, resulting in increased government revenues. Since the financial year 2007–2008, the BCCI has paid about Rs 3,500 crore in taxes. The BCCI did not pay taxes until the IPL because it was considered a charitable organization. However, after the IPL started, the Income Tax Department deemed it to be a commercial operation, and the BCCI has been taxed an amount of Rs 350 crore per year since then.
Good Things About IPL:
The IPL league offers a wide range of job opportunities, including cricket columnists, umpires, costume designers for all clubs, and police guards to protect the players.
The proceeds from the ticket sales are also substantial.
Multiple international brands are brought in as investors.
Gives new venture investors a boost in visibility.
The darker side of IPL:
This tournament has seen heinous match-fixing, harrowing on-field brawls, and widespread gambling, among other things. People can be seen binge-watching matches on their phones while simultaneously speculating on the results whenever the Indian Premier League matches are on.
The players are in it for the money, and the team's owners are in it for the money as well. Many IPL owners and players have also been arrested on suspicion of possessing illegal funds. The examples of CSK and RR can be used to demonstrate this.
This year, Vivo is the official sponsor, which has sparked a war of words and raised concerns about the cricket board's patriotism amid the border tensions with China. Choosing money overgrowth is a mistake. Vivo dethroned Dream11 due to higher sponsorship bids, totally ignoring the fact that it was "providing opportunities to local start-ups."
The IPL's mantra for Indian GDP:
The massive influx of visitors to India as a result of the IPL has had a huge effect on other facets of the Indian economy, resulting in higher spending on food, lodging, and transportation.
Since the IPL is such a big sporting event, it offers a large number of job opportunities for Indians. As a result, India's unemployment rate will fall, triggering an increase in consumption, which in turn will increase aggregate demand, resulting in increased economic growth. Indirect taxes are also levied on gate receipts, merchandising, and broadcasting rights by the government. This ensures that the IPL would raise a significant amount of revenue for the Indian government in the form of taxes.
The Plan for the Future:
In contrast to the rest of the board activities, the IPL has become one of the BCCI's most profitable projects, accounting for nearly 95 percent of the board surplus. The BCCI makes the most money during the IPL compared to the rest of the year. Since international players are paid well during the IPL, there have been few if any international cricket tournaments held during the IPL season for all players to be available. This means that the BCCI's negotiating power and prestige have evolved in tandem with that of other cricket boards around the world.
The BCCI was able to increase cricket activities at the National Cricket Academy (NCA) with the surplus from the IPL by allocating Rs.50 crores in 2018, compared to Rs.26 crores in 2017. Domestic cricket matches have also increased, as has the strength of women's and junior cricket, both of which can be attributed to the IPL's success. As a result, the IPL has allowed for more cricket growth, which could lead to better cricket players and even boosts India's cricket results with a substantial contribution to the economy.
This content piece was prepared by Nilesh.
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