IPL brand crosses $ 5.

3 b; pickups for Sri Lnka’s

Global Rakings
  26% growth over 2016 value
 Moves to auction media (TV and digital)

Wednesday, 10 January 2018

When an economy is growing at around 4% and the size of the economy is around
$ 80 billion, the consumer is challenged when it comes to purchasing power.
Inflation in November is at 8.4% as per the National Consumer Price Index whilst
the year’s inflation as reported by Central Bank is 4.1%.

What is more worrying for the country is that global ratings of Sri Lanka by top
agencies like the World Economic Forum, Transparency International and World
Bank, just to name a few, are on the decline. Let me take examples from the
sports field and how the lessons can be extended to Sri Lanka’s economy and the
link to the rating agencies.
IPL – $ 5.3 b in 2017
One of the most successful brand building campaigns the world has seen in the
recent past is IPL. For instance, the brand was developed in 2008 when the
economy was under severe pressure and it was able to attract millions of people
to purchase a ticket and experience the brand whilst today the IPL brand is valued
at $ 5.3 billion which is a 26% growth over 2016 as per Duff & Phelps, a New York-
based corporate finance advisory. The most valuable sub brand is Mumbai Indians
with $ 106 million, which indicates the power of brand building and strategy if
done properly.

If one does a deep dive on the brand value of the Indian Premier League (IPL) the
numbers have increased by 26% in 2017 to reach $ 5.3 billion from $ 4.2 billion in
2016, with new sponsorship deals and planned sales revenue from tournament
broadcast plus digital media rights. In my view in the 10 years of IPL in the last 10
years, the world has seen a glimpse of what to expect in the next 25 years. The
brand is poised to be $50 billion brand; let me pick up the lessons for Sri Lanka.

Lesson 1: Wait for the turning point

The fashion of selling cricket stars for big money was a big ticket item that
propelled the IPL brand to be seen differently from other forms of cricket. In
other words, IPL developed sub brands out of players that garnered a price. It was
an interesting concept but the issue faced in the last 10 years was that some
players could not take the pressure and some crashed to unlawful methods of
earning money that has led to the brand losing a staggering $ 1 billion during the
controversy. But the brand owners did not give up and today the brand has
picked up to a commanding $ 5.3 billion dollars which is the power of running a
business on a brand model.

The implication to Sri Lanka is the challenged tourism sector. Even though the
country crossed 2.1 million visitors into the country we have a situation where the
supply of room stock exceeds the demand chain, leading to overall pricing being
reduced. Due to inflationary issues the margins being squeezed has led to the
overall industry being financially challenged.
With the strong marketing and digital campaign planned for 2017 we can
‘turnaround’ the industry. The question is how many can stretch themselves while
waiting for the turnaround. This will also help improve the Country Risk Ratings of
Bloomberg where Sri Lanka is at 69 out of 82 countries as at 2017.

Lesson 2 – Brand health

Whilst IPL now has a focused set of customers, the challenge is to ride the wave
and understand the brand health. There is no point of a brand growing in the
short-term with a fashion status consumer following. There has to be re-purchase
and a loyalty base developed of core users in strictly marketing terminology. This
is what IPL needs to monitor in the next 10 years if one is to do justice to the
brand that gave a new imagery to brand India.

Latest research reveals that IPL 10th edition in 2017 generated 1.25 billion
impressions on television (awareness of the brand) across the five Sony television
channels (an increase of 22.5% over the year before when 1.02 billion impressions
were recorded). Incidentally the year before almost 1.25 billion impressions were
recorded with nearly 45% of the total viewership coming from rural India, which is
further evidence of IPL’s reach but one must monitor the repeat and loyalty levels
so that one can determine brand health, especially from the audience that comes
for the matches.

For Sri Lanka a key take is Ceylon Tea. Every 15 years we see how the consumer
base keeps changing. In 1960 the top five markets were the UK, Australia, USA,
Iraq and South Africa. In 1985 the top five were replaced with Egypt, Iraq, Syria,
Saudi Arabia and the UK (falling to No. 5 position). If we look at 2016, the top five
country mix has changed to Russia, Iran, Iraq, Turkey and the UAE. Hence we see
that Ceylon Tea’s brand health is weak and hence we lose the consumer base.

The truth is that economic bloc cartels change tariff rates and hence the demand
shifts. But another side of the same is that if the brand building happens, some
consumers can be retained. This is one way of Sri Lanka infusing policy changes
that will help improve the Global Competitive Index driven by the World
Economic Forum, where Sri Lanka is ranked 71 out of 138 as at 2016/17.

Lesson 3 – Support

private sector
Tracking back at IPL for the last 10 years when IPL season 2 ran into tough terrain
due to the Indian Government wanting to give priority to election from a security
allocation perspective, the then IPL CEO Lalith Modi very clearly made it known to
the world that he would cooperate with the Government and not get into a ‘turf
war’ even though billions of rupees were at stake.

Lalith Modi in its characteristic style took the high ground and said: “I am going to
export this product to another market.” The event that was staged in South Africa
was a masterpiece. It was an Indian-African mix that attracted the President of
South Africa to be the Chief Guest at the final. The Government of India whilst
focusing on the internal objectives supported the IPL CEO’s vision to take the
brand global by staging IPL that year in South Africa.

Sri Lanka, take a cue from this and support single-mindedly the Port City. The
decision to make this a financial hub was a strong move on this direction. The
legislation that is to be passed in February will increase the Ease of Doing Business
Index where Sri Lanka is ranked 110 on 190 countries. This indicator is absolutely
key if Sri Lanka is to attract Fortune 500 countries to enter its business landscape.

Lesson 4 – Drive one idea

When Lalith Modi decided to commercialise the 20/20 cricket by launching the IPL
brand, he believed that nothing was as powerful as an idea that the time had
come. He passionately drove the idea when a few actually believed it. As

Trevor Birch, Managing Director, Duff & Phelps and Ex-CEO of Chelsea FC
commented ‘ I’ve been intrigued to watch how IPL has marketed and protected
its own brand value separate to the clubs.With my experience of having worked
with some of the biggest clubs in the English Premier League (EPL).
If Sri Lanka is serious on making exports a 20 billion dollars we must Focus on
Ceylon Cinnamon as after all Sri Lanka has a 90% plus market share globally. This
sure has the ability to be a power brand given that a new HS code has been
mandated with strong policy work by the Government of Sri Lanka that
differentiates Ceylon Cinnamon from the cassia that is flooding the global market.
We must drive this business for value addition bench marking the apparel
industry of Sri Lanka. We have to drive up the Global Innovation Index which is at
90 out of 127 countries. For instance China has developed 71 innovations in the
last five years generating $331 billion to the economy in terms of revenue.

Lesson 5 – Youngsters
It may sound like a hyped-up idea but the reality is that IPL just like any other
consumer brand is targeting youngsters who make up a big market in the socio-
demographic template. If one were to do a competitor map, they were spending
two hours at the gym working out, a group of friends enjoying an evening drink at
a club or watching that favourite TV program at home. Hence IPL originators
identified that the only way to lure them was to provide a carnival atmosphere
with music, dancers and excitement with ruthless competitiveness that eventually
garnered 40,000 eyeballs to the brand. According to Varun Gupta, Managing
Director, Duff & Phelps India, IPL grabbed eyeballs for all the right reasons.

To me the parallel is Sri Lanka’s wildlife tourism. A recent study has revealed that
Sri Lanka boasts the highest propensity to see wildlife animals. What is required is
a strong policy to drive this to the key global markets where the eyeball attraction
finds this concept interesting. Last week Yala National Park was in the news for
having to increase the number of jeeps to 600 per day that will sure affect the
wildlife health.

The best example to the world is how Rwanda positioned the mountain gorilla
viewing experience. Today, this happens to be the number one foreign exchange
earner for the country where entrance fees are $ 1,500 per person and only 150
guests per day whilst the booking has to be done 18 months before. Sri Lanka has
to address this issue.

Lesson 6 – Brand ambassador link

If one tracks back as to why IPL has become a strong brand, one of the key
reasons is that its founder Lalith Modi got the best talent to back him. Be it Shah
Ruk Khan, Priety Zinta or Dhoni, the best young lifestyle TV presenters.
Apparently the franchisees were told to focus on the 10- to 12-year-olds as they
would be the target consumers of tomorrow and they also have the power to
influence the family.

Sri Lanka needs to do the same by getting the top personalities to talk of brand Sri
Lanka which is at $ 78 billion, growing at just 5%. The former Rotary World
President K. Ravindran, Nobel Prize winner Prof. Mohan Munasinghe and top
sportsman Kumar Sangakkara just to name a few are the brand names that can
make Sri Lanka a power brand. But the question is whether they will want to be a
brand ambassador when Sri Lanka is ranked 95 out of 176 countries in
Transparency International’s Corruption Perception Index.

(The author is a thought leader, public speaker and business personality and can
be contacted on rohantha.athukorala1@gmail.com. The thoughts are strictly his
personal views.)
Posted by Thavam