Star Sports, the official broadcaster of the ICC Cricket World Cup was in for a rude shocker the day tournament favourites India surprisingly crashed out of the World Cup. Its advertising revenue took a hit, as last minute advertisers, who were expected to pay a hefty premium if India made the finals, are now hedging their bets and unwilling to go the distance in terms of their spends.
To break it down for you, there are two types of ad slots up for grabs.
One is for the sponsors of the World Cup which are usually sold in bundled deals that are locked in at the beginning of the tournament; hence they are negotiated at a lower price. Around 40 advertisers have signed up as sponsors this time around, which include the likes of Havells, Amazon, MRF Tyres, Dream 11, Uber, Swiggy etc. and according to media industry sources pay an average rate of ₹ 8 to 10 lakhs per 10 seconds to air their content during matches.
The other type is spot buys, which are negotiated at a higher price depending on when advertisers come on board and for what matches. Since for sponsors the rate is already predetermined, it is the spot buys, which are the last minute buys, where Star Network is expected to lose revenue because of India not making to the final.
According to estimates, Star could have charged a premium of ₹ 25-30 lakh per 10 seconds, if India was playing in the final. However, currently these spots are expected to go anywhere between ₹ 15 – 17 lakhs per 10 seconds. Considering a typical World Cup match has about 5,500 seconds of total ad inventory, and games such as finals cramming in 10 – 15% more ad time, taking even the lower end of the spectrum, the men in blue not able to make it to finals may cost Star Sports upwards of ₹ 30 crore.
At the beginning of the tournament, Star was targeting an ad revenue ₹ 1,800 crore from television, its video streaming platform HotStar and digital media. However, as rain washed out four matches in the initial stages of the tournament, and now the fact that India has not made it to the final, Star is expected to rake in anywhere between ₹ 1500 to 1600 crore. What we find very interesting is that the IPL has managed to generate an ad revenue of ₹ 2,500 crores, which is significantly higher than the World Cup.
However, it was not all bad for Star India and several factors have worked in its favour this World Cup. The match timings in England were in tune with Indian television viewing time, and most of India’s games fell on weekends when viewership soared, fuelling ad revenues even further.
Another reason to cheer was the fact its streaming service HotStar clocked in record viewership, coming in at 19 million concurrent viewers for the India New Zealand semi-final on Wednesday, which was higher than the previous record of 18.6 million for the IPL final between Mumbai Indians and Chennai Super Kings on May 12th and even beat the 15.6 million viewers recorded during the India Pakistan game.
Concurrent views mean the number of viewers watching the match simultaneously at a given point of time.