Ipl Case Study.

Prepared by: Shrikant Athavale & Anuj Jindal MBA-SEMESTER-II Cosmic Business School, New Delhi

Under the guidance of: col. K.G. Puri. E-mail- [email protected]

Index Sr.No. 1) 2) 3) 4) 5)

Contents Historical Background Indian premier league as: business controversy. IPL as a case for management students. core facts of IPL Why IPL is looked as a case for business controversy.

The Board of Control for Cricket in India (BCCI) is the apex body governing the cricket in India. The board was formed in 1929, and has been registered under Tamil Nadu societies Registration Act. As the member of International cricket council it enjoys the right to choose the players, umpires, & allied officials for international events, and levies the control over them. BCCI has state cricket associations as the members for instance Maharashtra cricket association, Mumbai cricket association. The President of BCCI is Sharad Pawar& Niranjan Shah is the secretary. The Indian Premier League is a Twenty20 cricket competition created by the Board of Control for Cricket in India (BCCI). The first season of the Indian Premier League commenced on 18 April 2008, and it will end on 1 June 2008 when the final is played at the DY Patil Stadium, Navi Mumbai. Lalit Modi is the man behind the scene, who has brought out the dream concept in reality. Under Robin round teams will play twice against each other and the top four teams will be heading to the semi finals. Final will be played in Navi Mumbai on DY Patil stadium on 1st June, 2008.

Indian Premier League (IPL): the Business Controversy

Indian premier league (IPL): the Business Controversy The Indian premier league (IPL) is a miracle in the world cricket. We have experienced the drastic changes in cricket after the evolution of new cricket concept the t-20 cricket. Lalit Modi is the man behind the scene, who has brought out the dream concept in reality.lets not talk about the history of Indian premier league. Let us see how IPL is the case for marketing controversy. Marketing controversy either way, the end result is unparalleled coverage; residual awareness of your product, which later most definitely translates into brand recall, and even sales. Business controversy is the situation where in new entrant in the market covers up the entire field and establishes itself as a new brand in a very short span of time affecting the existing ones directly or indirectly. Controversy could be an amazingly low cost marketing tool that makes for the phenomenal media coverage and can be very effective if managed well it reaches the minds of the masses and will be of immense help in eliminating the odd dose of adverse publicity in the short term. IPL: the DLF Indian premier league is a big drama which has involved huge amount of money and intellectual capital. In the first week of April2008, , Indians woke up to headlines screaming that the newly launched Indian Premier League could, well, face a total media boycott – an unthinkable situation in a country where cricket is not a sport but a religion. The IPL has entered the cricketing business through various controversies.

The controversies with media about the photographs & with other cricket boards like Australia, New Zealand and England for signing their players and county cricket. This helped IPL to get the media coverage and people’s thought.

IPL: The Case For management Students.

Let us take a look at IPL as the management case. This would be discussed with reference to the functional areas management viz. Marketing management Finance management Production management Humana resource management

Marketing management One can legitimately claim that an IPL is the best example to learn the marketing as it has not left a single mod of promoting and positioning the service product for cricket fans. Cricket is a religion in India and IPL is a Prasad to Indian cricket worshipers. Not only Indians but through out the world the game has been promoted. Some of the marketing strategies (that are broadly seen & made the league a case for business revolution) are as mentioned below. 1) Auctioning the franchisees: the first step of giving franchisees to

some big guns in India like Mukesh Ambani, Shahrukh Khan, Vijay Mallya and the likes, which fetched huge public attention and helped creating curiosity in their minds. 2) Auctioning the players participating in the IPL tournament: BCCI has not any let any marketing strategy go down they announced the amounts for players by asking a bid by some sponsors, players like Mahendra Singh Dhoni,S.Shrisanth, R.P.Singh, Sachin Tendulkar, Sourav Ganguli, Rahul Dravid called for a huge amount, that eventually gave the IPL a publicity stunt. 3) Advertisements on various TV and radio channels. 4) Cheerleaders: one can’t deny the fact that cheerleaders are one of the most important factors influencing the people to come watch the game.

5) Worldwide telecast: the broadcasting rights were given to various TV channels across the world. The names of some channels and the amount involved would be shown in the table ahead. 6) Locations: the venues selected for the games are the cities of which the franchisee is named after. 7) Conflicts with some media partners and some other cricket boards again demanded the attention of people. 8) Timing: time selected for the game is in the evening so that people can have a great entertainment after the hectic experience in the offices. 9) ICL: the rival ICL had been one of the reasons for the publicity and emergence of IPL. People started comparing the IPL & ICL that caused the huge publicity for the IPL. 10)Franchises taken by film stars like Shahrukh Khan, Pretty Zinta, juhi chawla etc are the center for attraction. 11)Opening ceremony gala. 12) Live concerts like one show by Hariharan before Chennai and Mumbai match.

Production management: The IPL is a concept sale product. The production of IPL as a service product is exemplified by the mere volume of the production of revenue from every aspect of the game. Teams, players and every small aspect related to IPL has become a IPL product. Factors like material management for stadiums, players, Facilities arrangement for players, spectators, Guests, etc transportation management and allied activities require a proper management and BCCI has made all possible efforts to provide with the best facilities to everyone from spectators to players and third parties involved. Financial management: The investment decision in IPL by The Board of Control for Cricket in India (BCCI) is a daring financial decision which required damn financial planning. The return on investment calculation would have given the proper idea of the financial planning IPL has collected the huge money thorough sponsorships to teams and players, telecasting rights, advertisement banners and hoardings, and other allied activities. Even small aspect related to the IPL has become the product for IPL and fetched the money. This requires the management of funds coming in and going out, analysis of rise and fall in actual revenue and

expected revenue. Further planning for funds and budgeting. Allocation of the funds to franchisees & players, payment of wages, etc. are the financial activities. These revenues generated from sponsorships and other activities fall under the Central Pool, 40% of which will go to IPL, 54% distributed to franchisees and 6% to prize money. The money will be distributed in these proportions till 2017, after which the share of IPL will be 50%, franchisees 45% and prize money 5%. HUMAN RESOURCE MANAGEMENT: One can imagine how much human capital is required to make this event a happening. BCCI has been efficient and effective organization for managing the human resource. Labors like grounds men, security guards, Managers and other human factors everyone has been given the special attention and has been managed effectively by BCCI. One can’t deny the relationship management is the important aspect in today’s business scenario, there is no need to give any explanation on BCCI’s relations with all parties involved in the IPL. Organizational culture: the discipline and code of the conduct, player’s involvement in the game’s promotion, the governance of BCCI gives the look of well developed and sound organizational culture. The explanation above is more than enough to explain the IPL as case for management students.

Some important facts and figures of IPL

TELEVISION RIGHTS Winning Bidder

Regional Broadcast Rights

Terms of Deal

Sony/World Global Rights, India Sport Group

10 years at USD 1.026 Billion

Network Ten Free-to-air television in Australia

5 years at AUD 10-15 Million.

Setanta Sports United Kingdom and Ireland on a subscription basis

5 years, terms not disclosed.

Middle East broadcast rights on ADD's ART Prime Sport channel. Will broadcast to United Arab Arab Digital Emirates, Bahrain, Iran, Iraq, Jordan, Kuwait, 10 Years, terms Distribution Lebanon, Oman, Qatar, Palestine, Saudi Arabia, not released. Syria, Turkey, Algeria, Morocco, Tunisia, Egypt, Sudan and Libya.

Willow TV

Rights to distribute on television, radio, broadband and Internet, for the IPL in North America.

5 years, terms not released.

Super Sport

South Africa broadcast rights

Terms not released

GEO Super

Pakistan broadcast rights

Terms not released

Asian Television Network

Canadian broadcast rights. Aired on ATN's CBN & 5 years, terms ATN Cricket Plus channels on a subscription basis. not released Aired on XM Radio's ATN-Asian Radio as well.

Franchisees

Franchise Mumbai Indians

Owner(s)

Price (USD)

Mukesh Ambani and Reliance Industries Limited

$111.9 million

Royal Challengers Bangalore

Vijay Mallya and UB group

$111.6 million

Hyderabad Deccan Chargers

Deccan Chronicle

$107 million

Chennai Super India Cements and N Srinivasan Kings Delhi Daredevils Kings XI Punjab

GMR Holdings

$84 million

Preity Zinta, Ness Wadia, Karan Paul (Apeejay Surendera Group) and Mohit Burman (Dabur)

$76 million

Kolkata Knight Shahrukh Khan, Juhi Chawla Mehta and Jai Mehta Riders (Red Chillies Entertainment) Rajasthan Royals

$91 million

$75.09 million

Emerging Media: (Manoj Badale, Lachlan Murdoch, $67 milliSon Suresh Chellaram)

Sponsorship rights Indian real estate developer DLF Universal secured exclusive rights to the Indian Premier League title sponsorship worth INR 200 crore (over US$50 million) for five years. Hero Honda has been selected as an associate sponsor for five years in a deal worth US$22.5 million. In addition, soft-drink giant Pepsi secured the title as the tournament's Official Beverage by signing a five year deal worth USD 12.5 Million. The proceeds of the latter are to be shared equally by the league's franchise owners. [ Kingfisher Airlines has been named IPL's umpire partner with rights to advertise of umpire's clothes and also sponsoring third umpire decisions for five years. The deal is worth Rs. 106 crores (appx. US$ 26.5 million)

WHY IPL IS LOOKED AS A CASE FOR BUSINESS CONTRAVERSY?

Some of the reasons are; Why IPL is a case for business controversy? 1) It has penetrated the entertainment industry as manoranjan ka baap.

2) Every associate is benefited from IPL. 3) Market share of sponsors have experienced good results. 4) Restaurants in metros have experienced the growth in orders for their food products. 5) Sony entertainment television has experienced the tremendous growth in TRP over all the TV channels. 6) Other cricket boards like Pakistan cricket board are planning to open their own leagues. 7) It has brought the revolution in cricket world. 8) IPL has been in publics mind for every small affaire and that has brought a change in media. 9) IPL has gotten the huge media coverage. 10)Franchisees signing a player have to keep him in the team irrespective of the performance of the player. Given the controversies involved with the IPL (as they are publicity stunts for IPL) this makes for a study of the case business controversy

(References: The Hindustan times, internet, BCCI’s official website, wikipedia)