IPL Verdict: Do Tainted Franchisees Belittle their Brand Partners and the League?

The Supreme Court appointed high-level committee led by former Chief Justice RM Lodha on Tuesday found Chennai Super Kings official Gurunath Meiyappan guilty of betting during Indian Premier League season 6.

Pronouncing the verdict, Justice Lodha said Meiyappan was found guilty of betting, whereas co-owner of Rajasthan Royals, Raj Kundra, was found guilty of misconduct.

Both the teams, Rajasthan Royals (RR) and Chennai Super Kings (CSK), have been banned from the IPL for two years.

It comes as a big decision because both CSK and RR are the top performing teams in the league and have won the tournament in past. Apart from the two team franchisees being banned from the tournament, the decision also affects all the stakeholders of the game including players, media, brands and sentiments of their loyal fans. Besides, the overall image of IPL as a tournament is also put under scanner.

Sponsors?

A large sum of money has been invested behind these teams, as brands have locked them in for sponsorships and media deals, for promotions across mediums.

In 2015 alone, Rajasthan Royals grabbed 15 brand associations, of which three new brands came on board. It had had similar amount of brand associations during the last season. The new brands for Rajasthan Royals include Spice Mobiles, Kalasalingham University from Chennai and security firm CP Plus. Apart from this the team has 9 previous sponsors such as UltraTech, Rupa, Lawman Pg3, Mitashi, TCS, Kingfisher, Pepsi, Deakin University, ICE X and Kooh.

On the other hand, Chennai Super Kings has been associated with brands such as India Cements, Aircel, Gulf Oil, Pepsi, Reebok and Usha. In 2015, FreeCharge and ShopClues.com also joined the brand wagon.

Now, with the teams being taken off for a couple of years, what lies ahead for the brands? Saurabh Uboweja, CEO, Brands of Desire points out that the brands associated with the teams are at a lesser risk. "Sponsors will not be affected much and neither their equity will be diluted to a large extent as they have not done anything wrong. They have other options to endorse and will definitely go for other teams. While India Cements, that owns CSK, will be affected, but that too not in a large extent," adds Uboweja.

To this, Harish Bijoor, CEO, Harish Bijoor Consults finds that brands will be not be affected much. "It will be a short term loss for sponsors as their money to buy media will be affected, but not their brand equity. If not CSK or RR, they will be endorsing with someone else," adds Bijoor.

A Tainted League?

IPL is seen as the super bowl of India where brands partner with the teams to reach out to their target audience as the event cuts across the socio-economic categories. It is not the first time when the cases of corruption have come up in IPL. In past, players have been banned and teams have always been under scanner affecting IPL's image, so much so that in 2013, there were speculations that title sponsors Pepsi might walk out on the country's most lucrative sporting event.

Now, as controversy strikes IPL back, how is the league going to maintain its equity?

Bijoor finds that the decision will not affect IPL's equity as the tournament has been used to it. "IPL and controversy are no strangers. It all started with Lalit Modi, and has just paused at CSK and RR. The game and the tournament will not be affected," asserts Bijoor.

Uboweja mentions that the decision is a bigger loss for IPL. "If instead some smaller teams would have been suspended, people would not have bothered but now they will again think IPL as tainted as it has completely lost its credibility," adds Uboweja.

For the record, Indian Premier League viewership grew by 20% over the 2014 edition. The reach of the tournament also increased by 2% with first 45 matches having reached 182 million unique viewers this year.