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Massive Money Talks: Understanding How IPL

Franchises Earn Money

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Cricket in India is more than just a sport; it’s a passion, a way

Where Cricket Meets of life. And at the heart of this cricketing frenzy lies the Indian
Commerce Premier League (IPL), a glitzy and glamorous festival that has
revolutionized the game. But beyond the boundaries and
Share sixes, the IPL is a financial powerhouse that moves and
shakes the Indian economy in ways that are nothing short of
    remarkable. In 2024, the IPL team franchise earnings are
expected to be at an all-time high, making it a true economic
powerhouse.
Posted Apr 18, 2024
The Money Statistics
Category Economy
To comprehend the enormity of the IPL's financial muscle,
Tags one need only glance at the eye-watering sums involved.
Since its inception in 2008, the IPL has witnessed
SPORTS CRICKET exponential growth in its commercial value, with
broadcasting rights, sponsorships, and merchandise sales
IPL 2024 contributing to its meteoric rise. The 2023 season, for
instance, saw broadcasting rights alone fetching a staggering
$2.55 billion, underscoring the league's unrivalled popularity
among cricket enthusiasts worldwide.

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 Money Matters: A Breakdown

1. Media Rights: Media rights is the biggest means of how IPL

franchise earn money. The Indian Premier League (IPL)
media rights for the period from 2023 to 2027 were sold for a
staggering INR 48,390 crores (which includes both digital and
TV rights) 12. Here’s the breakdown:

TV Rights: Disney Star retained the Indian sub-continent TV

rights by paying an impressive Rs 23,575 crore (equivalent to
Rs 57.5 crore per game) 13.
Digital Rights: Viacom18 secured the digital rights with a
winning bid of Rs 23,578 crore
This monumental deal underscores the IPL’s immense
popularity and its impact on the sports broadcasting
landscape. Fans across the globe can now enjoy the
cricketing extravaganza through various platforms, including
JioCinema, which will stream the IPL 2024 in 4K UHD and
offer coverage in 11 languages 1. Whether you’re in India, the
UK, the US, Australia, or elsewhere, the IPL’s financial

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 juggernaut continues to roll, enriching the game and
captivating audiences worldwide.

2. Sponsorship : Everything in the stadium, from the bails on

the stamps to the players batting, has a cost. The actual
revenue of Indian Premium League comes from its sponsors.
Each and every IPL team franchise has sponsors for every
aspect of their play, including the jersey, sleeve, and key
sponsors, all of which significantly increase the teams' overall
revenue. For a hefty fee, the teams collaborate with
businesses to promote brands.

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 Two methods of promotion are used: print media and
advertisements. The player's jerseys serve as an effective
marketing tool. For this reason, an IPL costume often features
ten brand logos: two on the trousers, two on the shirts and
two more on the hat. Additionally, the franchisees produce
advertising content to advertise the brands' merchandise.

Even if the IPL sponsors 2024 don't make any direct profit
from the jerseys, they are nevertheless advertised through
the teams' social media accounts and merchandise designs.
For instance, CSK has partnerships with at least eighteen
brands, with Etihad Airways serving as the official sponsor.
Dream11, a fantasy sports platform, is the co-presenting
sponsor for IPL 2024. The associate ipl sponsors
2024 include Tata Motors, PayZapp by HDFC Bank, SBI, Cred,
AMFI, Upstox, Charged by Thumbs Up, Britannia, Pepsi, Parle
goods, Google Pixel, Haier, Jindal Steel, Vodafone, Dalmia
Cements, Kamla Pasand, and Rapido.

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 3. Merchandising : An important portion of the money that
IPL teams make comes from the sales of official gear. Among
other things, the IPL merchandise comprises authentic jersey
reproductions, sporting equipment, and sports mementos.
IPL and the franchisees have a great potential to monetize
their brand through merchandise, and IPL has begun to
replicate international athletic events.

With more IPL team franchises now pursuing heightened

merchandise promotion, it is anticipated that this pattern will
shift. India's market for gaming accessories is expanding at a
100 percent annual rate. This market has a value of roughly
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 $30 million. Each franchisee sells their own brand of goods,
which includes wristwatches, baseball caps, T-shirts, and
other accessories.

4. Gate Revenue : Another significant source of income for

the IPL franchises is the money made from the selling of
match tickets. A minimum of seven home games are
guaranteed to each franchise, providing them with an equal
chance to make money. Though ticket sales contribute a
smaller percentage (around 10-15%), packed stadiums with
dynamic pricing still generate substantial income, especially
for the home teams. All IPL club owners make money from
ticket sales, with the home team receiving a set percentage
of the total revenue.

The revenue from gate tickets and passes is then entirely

owned by the franchises. The IPL team franchise rely heavily
on their fan base for money, just like any other major sporting
event. With full houses for most of the games, it is one of the
most watched leagues in the world. This is one of the rare
revenue streams where franchises and fans participate
directly in the transaction.

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 5. Brand Value : Brand value is really beneficial to the team.
You stand a better chance of drawing in sponsors and
investors if your squad features elite players like MS Dhoni,
Rohit Sharma, and Virat Kohli. Participating in the Playoffs or
winning the IPL helps IPL franchises increase the value of
their brands. As a result, it is easier to bring brands on board
at the pricing that the owners desire. This is how IPL
franchise earn money through brand value. One must make
note that the teams with the highest brand values are MI,
CSK, and KKR, all of whom have won the IPL multiple times.

Therefore, DC and KXIP might not have the same negotiating

leverage with brands as teams like CSK and MI. It's crucial to
understand that a team's historical results do not alone
determine a team's brand value. Business titans like Keshav
Bansal and Neeta Ambani, as well as Bollywood actors like
Shah Rukh Khan and Preity Zinta, greatly contribute to that
element as well.

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 6. Prize Money : The IPL prize money system has been the
same over time, enhancing the legitimacy and equity of the
competition. Undoubtedly, prize money is the major sources
of how IPL franchise earn money. The winners take home a
hefty prize of Rs 20 crore, while the runners-up take home Rs
13 crore. Teams who place third and fourth receive
substantial rewards, taking home Rs. 7 crore and Rs. 6.5 crore,
respectively. The players and team owners split the prize
money, with the victorious team receiving the largest share.

The winners of the Orange Cap and Purple Cap, in recognition

of their outstanding batting performances, receive a
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 substantial monetary prize of Rs 15 lakh apiece as bonus
prizes.
Apart from honouring Orange and Purple Caps, the Indian
Premier League also acknowledges several other outstanding
performances. Significant prize money is given to the
Emerging Player of the Tournament, Most Valuable Player,
Power Player of the Season, Game Changer of the Season,
and Super Striker of the Season, which encourages players to
perform well on the field.

Impact on the Economy

Beyond the boundaries of the cricket field and understanding
how IPL franchises earn money, its important to put light at
the tournament’s impact on economy. IPL season
reverberates earnings across various sectors, playing a
pivotal role in stimulating economic activity and fostering
growth. From tourism to advertising, hospitality to consumer
goods, the IPL catalyzes spending and investment on a scale
unparalleled by any other sporting event in India. Cities
hosting IPL matches witness a surge in footfall, leading to
increased revenue for hotels, restaurants, and local
businesses.

Moreover, the league serves as a catalyst for job creation,

offering employment opportunities ranging from event
management and hospitality to marketing and media. The
IPL's ability to generate employment and stimulate economic
growth underscores its significance as more than just a
sporting spectacle—it's a powerhouse driving economic
prosperity.

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 Top-Earning Players
At the heart of the IPL's financial narrative are the players
who command whopping salaries, thanks to their prowess on
the field and star power off it. Topping the list of highest-
earning players is none other than Virat Kohli, whose
association with the Royal Challengers Bangalore sees him
pocketing a hefty paycheck, supplemented by lucrative
endorsement deals. Other players like Rohit Sharma, MS
Dhoni, and AB de Villiers are not far behind in leveraging their
cricketing prowess to secure lucrative contracts with their
respective IPL team franchise.

Beyond the marquee names, the IPL also provides a platform

for emerging talent to showcase their skills and earn
significant rewards. Youngsters like Shubman Gill, Prithvi
Shaw, and Rishabh Pant have all enjoyed substantial paydays,
underscoring the league's commitment to nurturing talent
and rewarding performance.
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 The Future of IPL Earnings
With the ever-increasing popularity of cricket and the T20
format, IPL team franchise earnings are expected to
continue their upward trajectory. This growth will likely lead
to even higher player salaries, further economic benefits, and
a solidified position for the IPL as a global sporting
powerhouse.

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