Advertisers rewrite rules for cricket pitches

The business of cricket advertising is never going to be the same again. Not after India’s early exit from the World Cup, which left several big-ticket advertisers red-faced. Not after bidders for cricket rights in India have had to forcibly share broadcasts with Doordarshan. And certainly not after the Essel group of Subhash Chandra announced plans on Tuesday to challenge the cricketing monopoly of the Board of Control for Cricket in India (BCCI) by launching an Indian Cricket League, which will give advertisers new options in due course.

India’s ignominious exit from the World Cup has already led to bitter renegotiation of ad rates with the broadcaster Sony. Several ad campaigns involving the Indian team or players (Pepsi, Visa, Reebok) have been pulled out, and contracts with cricketers have been cancelled (Sansui dumped Rahul Dravid and Videocon MS Dhoni). According to the grapevine, heavyweight advertisers who had signed up for the World Cup at hefty premia of Rs 2.5-3 lakh per 10-second spot are now getting the same at 60-80% discounts, at Rs 50,000-Rs 1 lakh.

To avoid such heartburn in future, the big change that is now being discussed by advertisers and media buying agencies is to relate ad rates to actual viewership.

Media buyers, who buy TV and print ad space on behalf of advertisers, are planning to write foolproof, and purely performance-driven, ad contracts with cricket broadcasters, including ESPN, which has the rights to the next two World Cups.

Some media buyers are suggesting a clause whereby advertisers will pay ‘x’ ad rate if India plays, and a reduced `y’ rate if India doesn’t. Advertisers may continue to buy ad rights in bulk, but the ‘x’ and ‘y’ rates for India and non-India matches could come to stay.

Other media veterans are also advocating a TRP-led, post-paid model which is in vogue internationally - rates that will be pegged to the viewership a specific match gets. (TRP, or television rating points, is a system to calculate how many people may have viewed a programme).

CD Mitra, president, Optimum Media Solutions, a media buying agency, is not sure such a model would work in India since advertisers may be unwilling to fork out more for high-TRP games. But then, it’s always possible to have contracts where payments are capped beyond a certain level of targeted TRPs.

Meenakshi Madhvani, managing partner, Spatial Access, a media audit and consultancy company, says: “The money these advertisers put in is actually shareholders’ money. When they say that cricket is a game of chance, shareholders’ money is simply up for gambling. This attitude should change. The TRP-led, post-paid model should be brought in and advertisers should be willing to pay a premium for high-ticket cricket events instead of gambling with shareholders money.”

What remains to be seen is whether broadcasters will accept the new script being prepared by advertisers and media buyers. The heat will be faced by ESPN, which has promised a mind-numbing $1.2 billion to acquire the rights to International Cricket Council (ICC) matches for the next eight years (2007-2015), including the next two World Cups. Global Cricket Corporation (GCC), which won the rights for 2000-07 at $ 550 million, sold the India rights to Sony for roughly $250 million.

Meanwhile, cricket planners point out three measures that broadcasters might take to promote cricket advertising. One, they might sell combo-package deals to advertisers that will not only include cricket events but also some other sporting events whose telecast rights the channel possesses. Second, they can appoint a third party, who will buy the advertising inventories in bulk from broadcasters and sell it to advertisers. In the current World Cup, Sony’s decision to sell a significant portion of ad inventories to Dentsu drew a lot of flak from media buyers and broadcasters who felt they could be cut out of future deals.

Third, broadcasters themselves could launch promotional activities to create the hype around the matches and the tournaments.

(Source : DNA)