The value of IPL is calculated on several factors. IPL is valued on the basis of expected return that an asset generates, the value of title sponsorship, the markup IPL gets for associate sponsorship rights, the value of broadcasting rights and the value of sponsorships at individual franchise level. According to global valuation and corporate finance advisor Duff and Phelps, the brand value of IPL after the tenth edition is $5.3 billion. The brand value of IPL has touched Rs. 34000 crores after the tenth edition of IPL. According to the Duff and Phelps reports title “IPL: The Decade Editon”, the brand value of IPL has jumped twenty-six percent in 2017. In 2016, the brand value of IPL was $4.2 billion and it has increased from $4.2 billion to $5.3 billion.
Vivo has paid Rs. 2199 crores for the title sponsorship for five years. It is the most dominating factor in the brand value of IPL. Star India has paid $2.55 billion (16000 crores) for the broadcasting rights of IPL for the next five years. This will take the brand value of IPL to the next level. Since 2008, the brand value of IPL is on the rise only. Nothing has affected the brand value of IPL. Even demonetization had no impact on the value of IPL. During that period also, IPL has seen a rise in the revenue from advertisements and sponsors.
Brand value of IPL in future
IPL is the cash cow for the BCCI. It has come a long way since its inception. After ten years, IPL has reached that level where it has started expanding its foothold in the global sporting scene. The amount at which broadcasting rights for the next five years are sold is almost double of the estimated value by the Duff and Phelps report. So the value of IPL is only going to rise. The report also stated that ten years of IPL has provided us the glimpses of next twenty-five years. It will be safe to say that for the foreseeable future, the months of April and May will stay demarcated as IPL territory where nothing else sells.
Brand value of individual franchisees
According to that report by Duff and Phelps, Mumbai Indians has the highest brand value among the individual franchisees. After Mumbai Indians comes Kolkata Knight Riders. At number three there is Royal Challengers Bangalore. At number four, surprisingly, there is Sunrisers Hyderabad. Sunrisers Hyderabad is the fairly new franchisee and it has higher brand value than Delhi Daredevils and Kings XI Punjab. The main reason behind that is Sunrisers Hyderabad has won the title in 2016 and Delhi Daredevils and Kings XI Punjab haven’t won the title even once. So at number five, there is Delhi Daredevils and at number six, there is Kings XI Punjab. The value of Rajasthan Royals and Chennai Super Kings was not mentioned in the report because both of them were suspended for two years.
Value of players
The value of players in IPL is equivalent to the brand value of IPL. Franchisees treat the players as Marvel treats its superheroes. Franchisees provide world-class facilities to their players. They book the best hotels of the country & make sure that the players are satisfied with the hospitality and the facilities of the hotel. They hire the best coaches and physios of the world. Franchisees make sure that the players are under no pressure. Franchisees surprise players with some unexpected gifts. They do everything to keep players happy and comfortable. Franchisees prepare the players like Marvel prepare Avengers. The only difference is franchisees prepare avengers to avenge their defeat on the field.
After ten years of IPL, the managing director and the ex-CEO of Chelsea FC said “I’ve been intrigued to watch how IPL has marketed and protected its own brand value separate to the clubs. With my experience of having worked with some of the biggest clubs in the English Premier League (EPL), I feel the one thing IPL has done really well is the way it has marketed and protected its own brand. Most of the EPL clubs are bigger brands than the brand EPL itself, whereas, in IPL, it seems to be brand IPL which is much more powerful compared to the individual franchises.”
When the ex CEO of one of the most valuable football club in the world can say such things about the value of IPL then one can imagine the value and foothold of the league in the world of sports.