The IPL Tug Of War - TV & Digital pull out all stops, but winner remains undecided

As Women's Premier League concludes, advertisers and brands are gearing up for Men's Indian Premier League, upping their marketing initiatives. The biggest debate this year has been IPL TV vs digital, and what's the ideal media mix. Social Samosa speaks to experts to find out who wins the race - Viacom or Disney Star.

The biggest advertising carnival, men’s Indian Premier League (IPL), is right around the corner. This season, for the first time in history, IPL’s media rights are divided between broadcaster Disney Star and Viacom18’s JioCinema. And there’s a war waging between the two media companies vying for advertisers’ money and viewers’ attention. 

In terms of sponsors, TV is already a step ahead. As per media experts we spoke to, Star has gathered 11 sponsors and 55 other brands and first-time bagger JioCinema claims to have 8 sponsors and more.

JioCinema’s first move in the war with Disney Star involved announcing the free airing of TATA IPL 2023. The next level of this war entails attracting advertisers and both of them are putting on irresistible offers as they are looking to recover hefty costs of content production, media acquisition, marketing costs, and other hosting expenses of IPL. 

Social Samosa spoke to media experts to find out whether marketers will choose to focus exclusively on JioCinema for their IPL ad spends this season or spread their budget across multiple platforms, and if media companies will recover their investment costs.

IPL TV v/s Digital: First Salvo in the War of IPL 2023

Media giants Viacom18 and Disney Star are selling the same property on two different mediums, with two very similar propositions.

Sharing what IPL's sales pitch entails, Vinay Hegde, Chief Buying Officer, Madison Media said, “Ideally it is a TV and Digital scenario but has now become a TV V/S Digital scenario, with both telecast players going all out to maximise reach. Star has decided to telecast some matches on FTA to combat Jio Cinema’s free across all platforms antes. CTV is assuming significance and HD is being pitted against it. So, the sales pitch is on the back of TV V/S Digital. Ultimately, it is the same pie of money that is available to both to vie for.”

R. Venkatasubramanian – President and National Head of Investments - Havas Media Group India said

brands are evaluating their preferred platform with a very focused lens to invest.

“Both the platforms are flexible, and they are ready to customize the packages according to brand requirements which was rarely seen in the past few years.”

JioCinema has already proven how powerful free streaming can be with FIFA World Cup 2022 as it witnessed an 860% jump in users in a month. The OTT platform saw its unique visitors jump from 2.36 million in October 2022, as per Comscore, to 22.7 million in November 2022.

Now, with the biggest sporting tournament in its kitty, JioCinema is likely to add more users and help MIPL gain more fans too. JioCinema’s free IPL streaming is expected to bring in new 550 million viewers and break previous records of viewership, which stood at 300 million in 2022.

“In current times, the split between television and digital media is more skewed towards digital, especially considering that IPL is free for viewers on JIO. This means digital consumption and advertisements are predicted to expand,” said Mohit Ahuja, President, GOZOOP Group.

Sahil Chopra, Founder & CEO- iCubesWire is also optimistic about seeing a digital-first approach. “The rise of high-speed internet and affordable smart devices contributes to the decline of Pay TV households in India. So it wouldn't be wrong to say IPL will take a digital-first approach.”

Whether it is TV or digital, users have more advantage this time. 

“With Jio announcing that it will make the streaming free of cost, it is likely to add to the overall reach of the property. So, whether it is TV vs Digital or TV & Digital, it is going to be beneficial for IPL and consumers both,” Jigar Rambhia, COO-Sporjo told Social Samosa. 

As per consumer data intelligence company Axis My India, only 25% of Indians watched IPL in 2022, and among those who watched it, 65% watched it on TV. Only 29% said that they have watched it on digital platforms.

However, IPL season 15’s TV viewership fell by 30-35% in the first four weeks compared to last year’s figures. IPL 2022 had scored a TV ratings (TVR) of 2.52, compared to a TVR of 3.75 in 2021, as per BARC. Ergo, both offerings on digital and TV and their shortcomings have confused advertisers. 

Hegde said that the initial response from advertisers was a cautious one. 

Sharing the reason behind cautious optimism, Hedge added, “Pricing on both platforms was the constraint with advertisers trying to balance between the 2 with probably disruption due to Jio and IPL’s declining ratings on Tv being the red herrings. Tv may not see an increase beyond an optimistic average of 5-10% over last season. While Jio has come out with what can be termed as an introductory offer of CPMs lower than what Hotstar sold at last year and with limited targeting options. Jio is also offering CTV at spot rates which are comparable with the HD only rate Star has proposed.”

TV’s Prior Experience An Advantage?

IPL has been a TV-led property and with JioCinema’s free airing plan, Star is all set to lock horns too. 12 matches from IPL 2023, including playoffs, will be made available for Free To Air (FTA) households too. This gives TV a competitive edge and Star can promise same viewership numbers to advertisers as Jio. 

Karan Taurani, Senior VP, Elara Capital believes that this is a good competitive strategy. “This is a good strategy by Star as it may keep the pay TV household number intact and more than compensate for the losses made by reduction in pay Tv households (annual loss of ~3%, which is 5mn households), as against an addition of 35-40mn FTA households,” he said in a report.

After Disney Star shared its target of 500 million viewers, JioCinema claimed to offer 550 million users across mobile devices and connected TVs (CTVs).

Traditionally, IPL has been a group activity. Friends and family gather to watch the T20  match on television. Due to the pandemic, IPL became got more popularity on digital mediums as it became a solo-viewing activity. Now that IPL is back to where it left off in 2019, TV could have an upper hand. With this, in-stadium viewers are expected to see a rise too.

Television also enjoys more reach. According to a KPMG report from 2023, TV has an overall reach of 900 million compared to the 450-500 million monthly active users of digital in 2022. Within this, sports has the highest reach among all genres at 722 million in the first nine months of 2023.

As far as consumers are concerned, TV is more affordable. While IPL is free on OTT, The cost per GB of data is close to ₹10 and streaming one T20 match can consume around 3.6GB on standard definition, 10.6GB on high definition and 26.6GB on a 4K device. On TV, viewers can pay ₹38 to get Star Sports for two months of IPL.

“We continue to believe that time spent and consumption of matches will remain high on Tv, as digital will primarily be convenience-led and on the go viewing; IPL on digital May get larger number of viewers or reach, however time spent comparison to tv remains to be much lower,” shared Taurani. 

It is not the first time that Jio would be disrupting a market with its ‘free’ plan. In the past, Jio has been known to increase prices in the second stage.

As far as advertising costs for IPL 2023 are concerned, Ahuja said they are likely to remain stable.

“Generally, the CPM (cost per mile) ranges from Rs 180 to 300, depending on the classification and combination of matches for which ads are purchased. This year, the CPM is expected to remain stable, somewhere within the same range,” said he. 

Will Media Companies Recover Their Costs?

While the viewership prospects look exciting, revenue projections paint a disappointing picture. A CLSA report calculates that for Ambani’s Viacom18 to break even and equate to their bidding cost, its advertising revenue will have to grow by 57%. 

If history is any proof, securing IPL’s media rights is an expensive business, and media companies struggle to recover their costs let alone make profits out of it. 

In the previous cycle of IPL, as per capital market firm Kotak Institutional Equities, Disney+ Hotstar garnered ad revenues of ₹1,100 crore (₹15 crore per match) and subscription revenues of ₹1,200 crore (₹16 crore per match). Viacom18’s winning bid of ₹58 crore per match for IPL 2023-27 implies a cost of approx. ₹63-65 crore per match including production/hosting costs, the report said. 

To secure the media rights, Viacom18 has paid a record ₹23,750 crore to bag two and a half bundles. It beat Disney Star to win the package that includes digital, non-exclusive digital rights and a few international countries. The report further says that Viacom18 would seemingly incur losses in the initial years and perhaps break even in 2026 or 2027 seasons.

While IPL promises new user growth, it might burn a hole in media owner’s pockets. If IPL continues to be free next year, sustenance of JioCinema from a revenue point-of-view might be questionable.

“We hope the Jio cinema offering too comes behind the pay wall next season onwards, as pure ad monetisation opportunities don’t support the high content cost, which makes business economics unviable,” said Taurani. 

Marketing Buzz

On the marketing front, both media companies have started their advertising blitzkrieg. 

Star Sports is celebrating fan culture around cricket with its campaign ‘Shor On, Game on,’ which promotes community viewing and virtues of experiencing IPL together on a big screen.

Sharing the idea behind the campaign, a Star Sports spokesperson said in a press statement, “As official TV broadcasters for the TATA IPL 2023, we want to bring fans closest to their heroes and help build an emotional connect which goes beyond on-field performances. We will continue to bring these stories alive during our coverage of IPL 2023, especially on India’s most watched Cricket show – Cricket Live.”

On the other hand, streaming platform JioCinema’s campaign #IPLonJioCinema highlights its free-to-view plan and focuses on various other user benefits.

“With both TV and Digital going aggressive with their marketing campaigns, IPL is surely going to benefit with higher reach, more viewers, etc. Also, after a gap of 3 years, we will see the “home and away” format back which will get the fans to the stadium,” said Rambhia. 

Popular Media Mix and Biggest Spenders for TATA IPL 2023

So, what is the ideal media mix for IPL 2023?

“If there is a regional focus, then that option is also available on Tv and an advertiser can minimise exposure by using that option. Similarly, one can choose an HD only option or a CTV only option,” said Hedge.

From Star entering the Metaverse for IPL to both media companies upping their regional marketing game plan, advertisers have more formats to explore this season. 

“Brands should remain vigilant for innovative targeting options such as Connected TV, Match highlights, Geo-targeting, Local/regional brands, Premium Device Targeting, Non-premium devices (value<15K), and Youth-targeting,” said Chopra. 

This year is all about maximum revenue generation – a tough game for both platforms and new categories have come forward to support the game.

Sharing where brands are spending their money, R. Venkatasubramanian said, “Gaming/beverages/delivery brands are assessing both platforms this season. Beverages /Gaming /Consumer durables/ Automobile are going to go big, and we may not see start up clients investing in big manner this year.”

The most awaited tournament is slated to start from March 31st to May 28th, 2023.

With Jio’s entry, there’s no doubt that we will see new trends in the OTT ecosystem and experts are confident that the upcoming 2023 IPL edition will shatter all previous viewership records.

Who do you think is winning the war? If your opinion differs, write to us at content@socialsamosa.com