Sports sponsorships jump 49% to ₹14,209 crore in 2022 on the back of big sporting events

• Cricket accounts for 85% of total spends, as other emerging sports continue to be small in comparison. Prime reason for the rise in cricket endorsements was higher number of matches and addition of new teams.
  
• Sports celebrity endorsements too rose by a hefty 20% in 2022 to ₹749 crore. Interestingly, while cricket accounted for ₹640 crore in 2022 and grew by 18%, endorsements from other emerging sports rose by 30% to ₹14 crore.
  
• Advertising spends by brands on television accounted for 73% of all sporting spends at ₹5,506 crore in 2022, clocking a modest growth of 9%.

There’s no business like the ‘show business,’ they say, but the world of sports is not far behind when it comes to the mega bucks. Two years after the pandemic, the business of sports has made a remarkable comeback with sports sponsorship spends growing by a whopping 49% year-on-year to ₹14,209 crore ($1,799 million). Prior to the pandemic this figure was a tad below ₹10,000 crore. No prizes for guessing that the hero of this business is cherry and timber – cricket, which still accounts for 85% of all sports sponsorships. GroupM, which released the 10th edition of the Sporting Nation Report 2023, a report on sports sponsorship in India, says that the Indian sports industry witnessed a significant growth in 2022.

The overall increase in spends was due to higher number of IPL matches, the addition of two new IPL teams, the ICC T20 World Cup, Asia Cup, FIFA World Cup, and the return of emerging sports events and tournaments like PKL, marathons, Maharashtra Open and the Commonwealth Games 2022.

Sports celebrity endorsements too rose by a hefty 20% in 2022 to Rs 749 crore. Interestingly, while cricket accounted for ₹640 crore in 2022 and grew by 18%, endorsements from other emerging sports rose by 30% to ₹14 crore.

Prasanth Kumar, CEO - GroupM South Asia said, “The Indian sports ecosystem is experiencing a revolutionary transformation, with athletes becoming influential role models for the youth and sports sponsorships gathering immense momentum. In this scenario, brands hold tremendous potential to tap into the passion and loyalty of Indian sports fans. Despite facing unprecedented pandemic challenges, the exceptional performance of the sports industry in 2022 reflects its resilience and unwavering commitment. As we move forward, technology will play an increasingly pivotal role in content management and fan engagement, while opening new and exciting opportunities in sports. Live sports will continue to be highly coveted as monetizable properties, making it a promising sector for investment."






The highlight of the report is the unprecedented growth in sports sponsorship in India, with total spends rising by 105% to Rs 5907 crore from 2021. These include spends on-ground, team and franchise. With the penetration of OTT in India, brands are likely to approach spending on sporting events differently. Clearly, the returns on sports advertising are much higher for brands given the high engagement levels. Not surprising then that sports industry spends have grown at a 14% CAGR over the last decade.

Television Vs OTT

Appointment viewing is dead when it comes to entertainment. But when it comes to sports, television sponsorships continue to dominate, even if the year-on-year growth rate is in single digits. According to GroupM’s report on sports sponsorships, television was the most effective medium for brands as it gives their campaigns more depth at optimal budgets. But digital is the new kid in town. Advertising spends by brands on television accounted for 73% of all sporting spends at ₹5,506 crore in 2022, clocking a modest growth of 9%.

No prizes for guessing that digital stands tall. Digital ad spends are fast catching up in sports as well, with YoY growth in digital ad spends on sports rising by 112% to Rs 2045 crore. It contributed to 27% of all media spends in 2022, against 16% just a year ago.

While the confluence of cricket and TV is the sweet spot for marketing behemoths, GroupM says that it has observed a greater propensity in advertisers to experiment with involvement in online streaming of Emerging Sports where they can operate with lower ticket sizes. The report says: “If we look at cricket’s contribution across types of media, we can see that it accounts for 95% on TV, and 90% on Digital Medium! In view of the evolving consumer preferences, and the onrush of tech-driven shifts, we can expect OTT to drive a digital groundswell in sports media advertising sooner than later.”

Television may be the big boy of ad spends right now, with a significantly higher share of revenues, but this is most certainly likely to change. Consumers will seek the convenience of watching their favourtite sporting events when they want and where they want. With the market share of Smart TVs set to rise fast, GroupM expects more consumers to watch live sports on a connected television set in the future. The report says: “Consumers seek convenience, and the benefits of OTT should, in due course of time, start working against the inertia of change as well. In the case of live sports, appointment viewing works very well, for we need to watch it when it is being played, and this would make these properties even more valuable.”

While this consumer shift is happening on one hand, the digital medium also offers advertiser benefits. With greater control over user statistics, advertisers on sports programmes on OTT medium can target certain segments of consumers, like people watching from specific markets, or fans who are using a particular device type (like a TV instead of a mobile), using a host of criteria which can be relevant and has the potential to add to the sharpness of the profile of the audience that will be exposed to the communication. For these reasons, GroupM expects the revenue gap between the digital medium and TV to reduce in the long run.

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