Indian_Premier_League (IPL)_2014

Maroon 9 (Christian Nass, Divya Kumar, Erik Sanders, Nicholas Joiner, Paul Lefevre, Stephen Faller) FINAL

CASE: INDIAN PREMIER LEAGUE

1

FINAL CASE: INDIAN PREMIER LEAGUE (IPL)

FIRM DESCRIPTION AND STRATEGIC CHALLENGE - The Indian Premier League (IPL) is the

major cricket league in India, and the world’s richest cricket federation with net profits of $71.5 million in

2012 (Emmett, J, 2012). It is run, regulated, and managed by the Board of Control for Cricket in India

(BCCI). Since its origination in 2008 by Lalit Modi, the IPL has emerged as the foremost cricket league

as well as one of the fastest growing professional sports organizations in the world. With brand

valuations in excess of $4 billion, Forbes has labeled the IPL as being “The World's Hottest Sports

League” (Schwartz, P. J, 2009). The league was created in 2007 out of the International Cricket Council

(ICC), the governing body of global cricket, which includes107 members from various participating

cricket leagues such as the African Cricket Association, the Americas Cricket Association, the Asian

Cricket Council, ICC East Asia-Pacific, and European Cricket Council. These leagues typically

participated in the traditional model of cricket, with matches lasting 1-3 days in length (ICC.com, 2014).

In an attempt to satisfy evening television audiences, the IPL differentiates its style of play from

other cricket leagues by playing a fast-paced, action-packed version of the original game known as

Twenty20 cricket, in which a match runs around three hours instead of days. The first official Twenty20

match was played in 2003 in England and has spread globally since. The business model of the IPL is

one of individual franchisees, similar to the National Basketball Association (NBA) and the English

Premier League (EPL). In 2008, the IPL held their league-starting auction with initial franchise sales

nearing $400M. There are currently still only eight franchises today though a few have started and

shutdown since (Exhibit 1). These eight franchises compete in 59 matches throughout the summer and

conclude in a brief playoff tournament for the top four teams. Revenue streams for the league include

franchisee membership fees, memorabilia sales, media rights and advertising. Revenue for the

franchisees comes primarily from shares in television rights, corporate sponsorships, and event ticket

sales.



2

The league is incredibly popular within the Indo-Asian region; albeit, several obstacles to the

league’s growth cast doubts as to whether the league will be adopted globally. Individual franchises can

cost upwards of several hundred million dollars, so initial investors can be difficult to find. In 2008, India

could not provide security for the league’s startup funding, so the league moved to South Africa for the

season (CNN, 2009). The attempt to market the league in a new country was successful and the IPL has

now integrated this strategy into each season, consistently introducing their tournament to new markets.

Recent studies indicate the decline in attendance over the first five years of the league has since righted

itself. Despite holding claim as the world's first live sports event to be streamed on YouTube, TV ratings

have been subsequently flat (Engineer, T, 2012). This is concerning as TV advertising is the main source

of revenue for the initial club investors (Engineer, T, 2012). TV advertising revenues are also highly

competitive, with many families preferring to watch soccer (Exhibit 2). Key sponsors for the league

include marketing giants such as Pepsi, Nike, Vodafone, Amazon, Starsports, and Sony (IPLT20, 2014).

In fact, the league is officially named the Pepsi Indian Premier League. Sponsorship can take many forms

but most commonly companies are seeking advertising mediums through the player’s uniforms, the

stadium billboards, and team and player merchandise. Keeping sponsors has been difficult as they are

quick to leave when there are downturns in attendance or television ratings. Sponsorships and other

revenue streams from event ticket sales and team merchandise have slowed down mainly due to a

slumping Indian Economy (Khambatta, P, 2014). Though revenue generation is a primary concern for the

IPL, resolving issues of fiscal responsibility and corruption are central to their success as well. In recent

years the IPL has been plagued with match-fixing scandals resulting in several players being banned from

the sport (Basnu, I, 2012). Any competitive advantage that the IPL will gain against other cricket

leagues, and other sports leagues, will be via its ability to attract and retain premier athletes. These

athletes will not likely continue to participate in the league if ethical issues persist.

Having already captured the leading position in the competitive cricket market, the primary

strategic problem now facing the IPL is how it can grow profitably within the global sports entertainment



3

industry (SEI). Should the IPL try to accomplish this by a frontal attack on its major competitors like

professional soccer and football leagues or should they focus in the core cricket markets like Pakistan,

Bangladesh, Australia, New Zealand and England.

The IPL’s struggles to expand are a matter of strategic misalignment, particularly in the fields of

marketing, finance, and ethics. The earnings potential within foreign markets will only be tapped if the

IPL can successfully generate first-time exposure to the sport in new markets, grow the sport in under-

developed markets, and clean up the corruption that is marring the league’s image. The IPL must make

decisions on whether they should focus marketing efforts for short-term gains in television exposure and

sponsorship rights or whether they should invest in marketing for a long-term adoption of cricket and the

Twenty20 format. Financing this growth is going to be critical as well. The IPL must wrestle with the

balance of enabling their players to become global icons but not allowing the players to become so

powerful they could create a rival league or negotiate business-crippling salaries. Despite these strategic

challenges we feel that the IPL has a bright future to increase cricket’s following throughout the world

and sustain a competitive advantage in the SEI.

EXTERNAL ANALYSIS - Since 2005, the industry’s profitability has seen ups and downs. The league

witnessed a near 13% average rise in revenues between the years 2005-10 from $107.5 billion to $121.4

billion, which was counterbalanced by a 6.8% drop in back to back years from 2008-09 (Fenez et al,

2011). In the case of the IPL, the league franchise fee went up by 300% when new teams tried to enter in

2011 (ESPN Cricinfo, 2009). This growing trend in franchise value is not isolated solely to cricket, but is

visible within football, baseball, and hockey as well, indicating the total value of the industry is the result

of new industry growth versus market rivalry (Exhibit 7). With increasing competition from other sports

leagues that have captured the world’s attention, coupled with strong political issues and the state of the

economy, industry profits in the future will not be as easy to gain without taking strategic steps to either

defend existing markets or take over others. {See Exhibit 8 for further analysis of external SEI forces}



4

PESTEL - Political (Highly Relevant): Along with legal issues, politics have always played a key role

in the SEI. Sport was used to isolate apartheid in South Africa across all sports platforms, eventually

impacting the sociocultural norms within the region (Cornell, 1998). Within the current era, politics

continue to influence the industry particularly in India, as the 2014 elections in India are impacting the

ability for teams to garner enough security to play. In 2011, the central government minister was forced

to resign his post because of a controversial franchise bid (GargiParsai, 2010). Due to the global nature of

the game, it is difficult to determine what effect politics will have on the industry as a whole.

Economic (Relevant): Despite global economic challenges of late, the SEI numbers are still on the rise.

Particularly in the US, the SEI is witnessing total industry improvement, particularly within the NFL,

MLB, and NHL. With the rise of the global middle class, disposable economic income will continue to

improve, likely improving the total number of consumers following the industry. Current populations and

growth rates in Asian countries will be particularly important as this will shift the SEI market revenue

from East to West and from historically dominant sports leagues to perhaps new and emerging ones.

Socio-Cultural (Relevant): Cricket is largely popular in traditionally colonial countries. Originating

from England, the game followed the English Navy across the globe. To date, cricket has largely failed to

cross the gap between colonial and non-colonial based nations. This influence grants the game greater

opportunities for growth within the traditionally poorer former colonial regions of the world, but poses

significant barriers to entry within the non-colonial world-particularly the wealthy, sports-saturated US.

In the same light, many U.S. sports have only been able to penetrate certain markets, having little

influence in the formerly colonized countries.

Technological (Highly Relevant): With continued advances in technology such as higher-quality

television coverage, the broader diffusion of Internet connectivity across the globe, and the use of social

media all contribute to the industry’s continued growth (Fenez et al, 2011). Technology has helped shape



5

the industry into what it is today and will continue to help strengthen the industry’s profitability as a

whole.

Ecological (Non-Applicable): There are no significant ecological factors tied to the industry’s future

growth or profitability.

Legal (Highly Relevant): The only issues that seem to affect profitability have been when leagues run

into legal issues or when political agendas have been pushed. Some examples include the MLB strike in

1993 and the NBA lockout in 2012 in which issues surrounding performance pay of the players arose

leading to the need for arbitration. More recently, it has been costly to the IPL when allegations of spot

fixing and betting surfaced about some of the players. Should the ethical concerns surrounding the league

continue, this will constrict profit potential within the league as the negative image of the sport will drive

consumers to alternative options whether in the industry or not.

FIVE FORCES - Threat of Entry (Low to Moderate): When examining the major players of this

industry it is best to aggregate individual franchise teams into their respective leagues. The English

Premier League, Formula One Racing, NBA Basketball, NFL Football, MLB Baseball, and IPL, all

which have a transnational following, hold sporting events in more than one country, and employ a

diverse group of players. Smaller local sports leagues are abundant and include local competition for the

above-mentioned leagues. However, with the high start-up costs and time it takes to organize a

professional sports league, the threat of new entrants is still fairly low.

Power of Suppliers (Moderate): Though initially the primary revenue streams for the industry consisted

of gate revenues, it now includes media rights, sponsorship, and merchandising (Mason, 1999). Supplier

power is low to moderate though because of the number of choices of so many different media streams

and merchandizing options. Also, corporations within the television industry such as Disney have

vertically integrated by purchasing portions of media companies like ESPN and ABC Sports as well as

franchises like the NHL’s Mighty Ducks and MLB’s Anaheim Angels (Stotler, 2000). Despite the fiscal



6

strength of these companies, their strengths and interests are largely invested within complementary

industries such as media and advertising. With regard to IPL, efforts to increase the popularity of cricket

may have inadvertently caused a shortage of supply of premier cricket players resulting in increasing

salary demands (Fenez et al, 2011). To help solve this, the IPL may benefit from investing in the sports

youth leagues because of the increase in future talent they would provide.

Power of Buyers (Moderate to High): The SEI is a very lucrative business and will continue to be so as

long as there are sports fans in the world. Revenue streams within the industry can be volatile from year

to year as economic factors weigh heavily on revenues generated, thus yielding to the buyer power of the

end users. Buyer power may be substantial, but IPL’s financial success hinges on the league’s continued

growth globally. Buyers in the near term pose minimal threat to the SEI’s profitability.

Threat of Substitutes (Low): There are many different sports, different tastes, and different options to

purchase and as such the industry as a whole has a low threat of substitutes, with alternatives being other

forms of entertainment such as movies, music, and art—most of which do not provide quite the same

experience. It will be important though for the IPL to continue to monitor ticket prices. Many of the

major sports leagues around the world can in part trace their success back to the accessibility of the game

to the working classes. If cricket’s reputation becomes that of a privileged class sport with ticket prices

out of reach for the poor or middle classes the threat of substitutes will increase dramatically.

Rivalry (Low to Moderate): Due to the diversification in sport and sociocultural interest there has been

plenty of room for competitors. With increased world visibility, leagues that once did not compete

against each other for the attention of its audiences and shares of revenue. New competitors in the form

of long-time established leagues have encroached on the market share and new leagues, such as IPL, have

come about as serious competitors in a short amount of time.

Strategic Role of Complements (Relevant): The increase in revenues due to merchandising, franchise

sponsorships, and ticket sales provides added incentives for industry growth. The SEI has excelled in



7

controlling the merchandising of the branded teams with “authentic” collections that are highly desirable

to all ages of fans and provide instant advertising for the industry. The strength of these complementary

products and services increases the league’s profitability, and strengthens ability for leagues to negotiate

with industry sub-partners as their popularity increases each party’s bottom line.

Structure-Conduct-Performance (SCP): The SEI, where leagues and their franchises are the main

stakeholders, is oligopolistic in nature. With the convergence of globalization of the industry and

improvements in technology, the industry is transforming more towards monopolistic competition. As

the industry consolidates, the strength of both the leagues as well as the franchises themselves will

continue to increase SEI profitability. The SCP model indicates this industry is generating large profits,

growing at an exponential rate, across a global stage. Those that are contenders within the industry are

poised to earn significant returns in the near and medium-range term, should they be successful in

appealing to multiple audiences on multiple continents. Those that cannot do so will need to shore up

strong positions in their current locations to defend against competition.

INTERNAL ANALYSIS - Within its grasp, the IPL holds several resources and capabilities that can be

leveraged for competitive advantage. Currently, the IPL has applied their strong financial position so as

to capture market share from other cricket leagues including the ICC. But as it its options to expand

within the SEI, IPL needs to correctly reposition its brand in order to compete with the equally strong

financial position of rival leagues within other sports.

STRENGTHS - Superior Financial Position: The league’s superior financial position permits BCCI to

take risks that other domestic cricket leagues cannot afford to attempt. This is due in part to the tax-

exempt status that the league enjoys within the Indian market. It is also no surprise that this resource has

resulted in a great deal of scrutiny, as other domestic cricket leagues argue this grants the IPL an unfair

and unwarranted advantage on the world stage. The league’s growing financial assets are also the result

of the prudent planning that transpired at the league’s inception. Per the inaugural franchise prospectus



8

that was published circa 2007, the league’s ability to generate revenues is based on 4 categories: TV

media rights, title sponsorship and merchandising, franchise sales, and a portion of the revenues that are

generated by the franchises themselves (Basu, 2008). A financial analysis of estimated revenues year

over year demonstrates that the largest portions of the league’s income are raised within the first three

categories (Exhibit 4). From 2010-12, the league witnessed an explosive level of growth with revenues

growing at 35.8%, 16.89%, and 23%, respectively. But these trends do not appear to be sustainable, with

growth in 2013 slowing to 5%, and 2014 projections even slower still at 3%. TV revenues in an industrial

rising nation could become huge in the future years, as well as access to satellite subscriptions around the

globe.

Brand Equity: As a whole, the IPL is currently the largest and most-recognizable cricket league in the

world. This provides the IPL a critical capability because the league is the global influence cricket scene.

Prior to the league’s inception in 2008, the global governing board of the ICC had included India among

the qualifying members of the Future Tours Program (FTP), which hosts certain international “test”

matches in various venues around the globe in order to gain access to various global markets

(ESPNcricinfo, 2006). Since the league’s inception, the IPL has wielded incredible influence, so much so

as to influence the FTP’s schedules in its favor. As a result, the IPL’s international players are available

throughout the season, and the IPL competes with no other league globally, creating a virtual “monopoly”

on its players’ availability. Such influence is remarkable, given that other international sports such as

soccer and basketball cannot garner the same level of support for their international players at the club-

team levels. This gives the league unparalleled access to current cricket markets, including domestically

within India as well as on an international stage. This advantage also grants the league greater

opportunity to attract top-paying sponsorships from the likes of multi-national firms such as ESPN, Pepsi,

and Nike et-al. IPL is literally the “Premiere” cricket league in the world. As mentioned before it has the

majority of the best cricket players in the world, with some of the best fan bases that pack the biggest

stadiums in the world. Like all major sports entertainment leagues sponsors can potentially bring billions



9

of dollars of revenue to the IPL. Cricket is the major sport in India and Pakistan in addition to the 51

other former English Commonwealth Colonies, which have a combined population of 2.3B people and

account for $9T in total GDP (Census).

Players: The players are one of the main strength of the IPL. The IPL has international participation of

some of the most famous athletes in the world. In addition to helping to sell tickets and bring in revenues

at the gate, the players are also an excellent form of marketing revenue for the IPL where they can help

bring in partnerships with companies such as Nike who market the player’s jerseys. The IPL’s player list

boasts a talent pool that is unmatched by other leagues. This is undoubtedly related to the IPL’s deep

financial assets, and has served the league well, particularly in the sales of jerseys and related

merchandise (Dalal& Shah, 2014). Another capability, that is primarily defensive in nature, is the

BCCI’s firm control over the league’s stadiums. Franchisees own the stadium rights and can rent them to

other sporting competitions. There is therefore no or very low opportunity for other cricket leagues to

enter terms of agreement to use a franchise directly over the use of its stadium.

Core Competencies: Within the bundle of capabilities and resources organic to the IPL lie three that can

be identified as core competencies to the league. The first is the strong financial position of the league as

a whole. This advantage is sustainable due to the path dependencies created by the league’s initial

franchise agreements, as well as the social complexity surrounding the sport of cricket within the Indian

sub-continent. The league’s absolute control over venue locations also demonstrates a path dependency

that is again tied to the league’s original franchise agreement. This may not be difficult to imitate within

other leagues, but it does preclude any further exposure to the captive Indian market within these

stadiums. Given the incredible capital constraints required to build a new stadium, it is unlikely any other

league or franchise would build a stadium to test its presence within a new market. Finally, the league’s

brand equity provides a global influence is a capability that is sustainable likely for a long time to come.

Although the league’s dominant position could change, there is both casual ambiguity as well as social



10

complexity that shroud this capability from external attack, making this a competency that the league can

build off of as it aims to enter new markets.

WEAKNESSES - Match Fixing Scandals (and impact of reputation): The IPL has been plagued by

allegations of match fixing scandals and the general unsavory reputation of the BCCI. Corruption is

perceived to be high within the upper echelons of the BCCI (Engineer, 2014).

Marketing Skills: The IPL’s marketing abilities are considered to be inadequate to potential rivals such

as EPL, or NBA, or NFL. It is critical that the IPL learn from the mistakes and successes of the

marketing efforts of these leagues. The IPL can still be considered as a relatively young and developing

league compared to more established leagues such as the EPL, NLF, or NBA.

Uncontrolled Costs: Costs are extremely high to run a team ($100’s of millions) and while the league,

as a whole, is financially strong, it is also financially unstable which has been seen in the fact that various

clubs have exited the league in its short history (Exhibit 3).

STRATEGIC ALTERNATIVES - Current Strategy: The IPL’s current strategy is one that is based

on differentiating the sport within the countries that traditionally observe and play cricket. Although this

approach has more than doubled the market value within the league’s first 6 years of existence, the league

will require greater exposure at the grass-level should it desire to spread beyond the historically colonial

areas and compete with the world’s leading sports competitions (Exhibits 4, 6). Based on the current

situation the IPL finds itself in and its potential for expansion, the IPL has many directions they can take

the league. Our team has listed several options along with opportunities and challenges each decision

would incur.

Strategic Alternative #1: The first option involves shoring up some of the IPL’s weaknesses to take

advantage of future opportunities around the globe and in cricket playing countries. Before the IPL can

look at expanding its presence in any market or improving its brand image, the league must distance itself



11

from the scandals it has fallen to in the past. It must install an oversight board and increase their power to

punish those that attempt to fix match results. This will require both time and money from the league as

they attempt to change the culture throughout of what is deemed acceptable business practices in the

sport. The IPL also needs to work on its marketing skills, which can help it when trying to enter new

markets around the globe. The final step would be to partner with Internet and satellite providers.

Currently many sports leagues have satellite channels that are shown on a subscription basis and can

broadcast the leagues games to any TV in the world. The IPL has the best players and is known for the

highest quality of play, so they should try to form a partnership with satellite and Internet providers to

carry their league similar to what the EPL or NFL networks already provide.

Advantages & Benefits: The main advantage of this strategy is that it will cost very little to implement.

Aside from the funding for the Ethics Board, this strategy requires no additional investments beyond its

current business practices. The IPL needs to continue to pursue its relationship with companies such as

Nike and Adidas, and leverage their capabilities via a partnership as they try to expand around the globe.

These partnerships are mutually beneficial and have the added benefit of bringing in additional profits as

the IPL players and the league itself become more prominent in the global consciousness. These

companies are famous for generating interest in players, which then translate into jersey sales that lead to

more profits for the IPL. With the help of advertising such as Nike’s “Bleed Blue” campaign, currently

the IPL and Nike sell 500 individual jerseys a day on their website (India Times 24). It follows that as

their global exposure increases, so will their revenue. They can then gain more revenue through these

subscriptions while at the same time gain valuable market share at the expense of the competition. Many

developing countries in which cricket is popular are gaining access to satellite and Internet technology.

The IPL could team with local and national providers to offer season passes to the IPL channels much in

the same vein as the EPL and NFL already provide.

Disadvantages & Risks: While the prospects of the global market are enticing, there are a few

drawbacks to trying to compete on a global scale. One huge disadvantage is that some of the largest and



12

potentially lucrative markets such as the US or Europe already have wildly popular sports entertainment

leagues such as the EPL or NFL and NBA. The IPL would be at an initial disadvantage if they tried to

infiltrate these markets from an exposure standpoint. The NFL, NBA, EPL also have significant financial

resources and would fight back with increased advertising and marketing efforts to help defend their

market shares as well, and the IPL does not currently have comparable financial resources to engage in a

competitive advertising campaign. With current Super Bowl adds selling for over $1M per 30 seconds,

the IPL could easily spend its entire marketing budget and still not create much of an impact on the target

audiences. This means that the IPL would be relying upon most of its revenue growth from the

Commonwealth of Nations, which while they include a large percentage of the population, they do not

include many Southeast Asian countries and are missing out on the Chinese SEI market.

Financial Analysis: While an exact return on investment is difficult to capture, the league can easily

appropriate $5 - 10M from their TV rights which are project to reach over $1.2B (Exhibit 2) to set up an

advisory board to establish and oversee an ethical charter for the league. The rules themselves would be

inexpensive to set-up, but this budget can be used to give the oversight board the “teeth” necessary to

enforce the rules in a league spread across an entire subcontinent. Shoring up the one of the largest

weaknesses of the IPL will only help to reinforce the league’s Brand Equity as it tries to expand.

Strategic Alternative #2: The IPL can go on the offensive by utilizing the popularity of their players,

their financial muscle, and their TV contracts by creating developmental leagues to gain market share in

the lucrative foreign markets in China and Southeast Asia. They can achieve this by marketing their

talented players in a country like China to help attract kids to developmental leagues that they can create

and fund with the money they have from the league itself and the potential hundreds of millions of dollars

that they will raise through lucrative TV contracts. One of the best ways to do this is to reach out to the

youth and promote the sport at a younger age. Providing fields and training seminars from some of the

top cricket players in the world will increase the interest level of the fans and drive them to be more



13

connected to their local team. The youth leagues also have the added benefit of producing potential future

IPL players.

Advantages& Benefits: The IPL has to be careful not to sacrifice the local fan base, yet increase

international awareness of the league. The best opportunity to do so would be to set up new teams and

franchises in new countries. These teams would play against the other IPL teams. This option allows the

IPL to increase its fan base by having more teams in the league that are spread out across the region,

instead of just spread out throughout India. This option would require a strong financial investment from

the IPL in order for this to be successful. Purchasing, building, and maintaining new fields is not

inexpensive. Working with the players to spend additional time for the league involves adjusting player

contracts and will take time.

The IPL has historically chosen to move the games outside of the country during the election

season, so that the games do not become targets from terrorist groups. Every time they move the games

to other countries, they introduce the sport to other nationalities and give them opportunities to attend the

games. The IPL could continue to host games, or even portions of the season, in different countries,

which will bring new fans into the sport and help the IPL become recognized internationally. If this

option is chosen, the countries the IPL should focus on should be ones that already have an interest in

cricket. The league has already played successfully in South Africa and UAE. The IPL should continue

to expand throughout the Asia-Pacific and Africa regions.

Another additional benefit is that the IPL can test strategies and changes to the game itself in the

developmental leagues and use them as a test market. Any changes that were widely accepted or found to

be popular in the developmental leagues could then be taken in to consideration for the IPL itself with

almost no cost to the IPL.

Disadvantages & Risks: The concern with this option is currently the best players from around the

world are playing for the current IPL teams. If the IPL were to drastically expand, the average talent level



14

would be diluted, which could cause fans to lose interest in the sport. Also, if the IPL were to spread out

too far, the change in time zones could cause jet lag to the traveling team, causing them to have a distinct

disadvantage for the matches.

Several other competitors are attempting this tactic. The NFL has played one game of the regular

season in London since 2007. The NBA has played its opening season games in Tokyo several times

over the past 20 years. If the IPL were to consistently play its games to other countries, it would be able

to build interest from fans across the world. The league is already streaming its games on YouTube,

which would allow the new fans in other countries to continue to follow their favorite teams and/or

matches after the teams have returned to India. The downside to this strategy is the potential to lose fans

within India. If the IPL matches were consistently being played outside of the home team’s city, the local

fans would not associate with the team as well and the IPL would lose its local support.

Financial Analysis: If the IPL follows the same guidelines as its competitors in the NBA or MLB, the

average developmental league franchise will cost as much as $22M. While each team could be expected

to earn as much as $11M a year, the average MLB developmental team earns its owners approximately

$4M a year which adds up to an 18% ROI (Forbes 29). New Stadiums could also cost a great deal of

money at over $200M for a state of the art facility (Linnell, 1996). If each of the current members of the

IPL were to sponsor a team, costs could quickly escalate to over $1B; however, the youth league affiliates

that accompany and spring up around these developmental franchises will cost virtually nothing to the

IPL.

Recommendation: Our team believes that Strategic Alternative #2 is the best strategy forward for IPL to

adopt. In India, IPL is already a cash cow for the BCCI and the time is right for them to expand the

league into foreign markets. The first step IPL should take is to promote developmental leagues in

foreign markets starting a grassroots movement amongst the younger generations who are increasingly

open to new things having been raised in a global society. This will not only serve to increase the



15

league’s fan base, but also give IPL the opportunity to further develop the next wave of top talent. Next,

IPL should study other leagues, gleaning other top sports management techniques currently being applied

in the targeted markets. This should be added to their current successful formula and applied only in the

target market, so as not to detract from the quality of and revenue stream for the already strong and ever

growing Indian cricket market. Finally, IPL should begin their expansion using technology to showcase

their pool of top international players, financial strength, and media power and fully infiltrate the new

markets.



16

Works Cited

1. Emmett, J. (2012, September 24). BCCI Records Giant Leap in Profits. Retrieved April 23, 2014,

from http://www.sportspromedia.com/notes_and_insights/bcci_records_giant_leap_in_profits/

2. (2014). IPLT20. Retrieved April 23,2014, from www.iplt20.com

3. Schwartz, P. J. (2009, August 27). The World's Hottest Sports League. Retrieved April 23, 2014,

from http://www.forbes.com/2009/08/27/cricket-india-ipl-business-sports-ipl.html/

4. England and South Africa Race to Host IPL. (2009, March 23). CNN.com/World Sport. Retrieved

April 23, 2014, from http://edition.cnn.com/2009/SPORT/03/23/cricket.ipl.india.england/index.html

5. Engineer, T. (2012, June 14). Stadium Crowds Show the IPL the Money. ESPN cricinfo. Retrieved

April 23, 2014, from http://www.espncricinfo.com/magazine/content/story/568291.html

6. Khambatta, P. (2014, March 28). India in 2014: Elections and Economy. Center for Strategic and

International Studies (CSIS). Retrieved April 23, 2014, from http://csis.org/publication/india-2014-

elections-and-economy

7. Basnu, I. (2012, April 16). BCCI Suspends 5 Cricketers for IPL Spot Fixing. Retrieved April 23,

2014, from http://timesofindia.indiatimes.com/sports/cricket/ipl-2012/news/BCCI-suspends-5-

cricketers-for-IPL-spot-fixing/articleshow/13156492.cms?referral=PM

8. Fenez et al, (2011) http://www.pwc.com/en_GX/gx/hospitality-leisure/pdf/changing-the-game-

outlook-for-the-global-sports-market-to-2015.pdf

9. Fenez et al, (2011) http://www.pwc.com/en_GX/gx/hospitality-leisure/pdf/changing-the-game-

outlook-for-the-global-sports-market-to-2015.pdf

10. Daniel S. Mason, (1999) "What is the sports product and who buys it? The marketing of professional

sports leagues", European Journal of Marketing, Vol. 33 Iss: 3/4, pp.402 - 419 - See more at:

http://www.emeraldinsight.com.ezproxy1.lib.asu.edu/journals.htm?articleid=853602&show=abstract

#sthash.gLxA1Jy6.dpuf

http://www.sportspromedia.com/notes_and_insights/bcci_records_giant_leap_in_profits/

http://www.iplt20.com/

http://www.forbes.com/2009/08/27/cricket-india-ipl-business-sports-ipl.html/

http://edition.cnn.com/2009/SPORT/03/23/cricket.ipl.india.england/index.html

http://www.espncricinfo.com/magazine/content/story/568291.html

http://csis.org/publication/india-2014-elections-and-economy

http://csis.org/publication/india-2014-elections-and-economy

http://timesofindia.indiatimes.com/sports/cricket/ipl-2012/news/BCCI-suspends-5-cricketers-for-IPL-spot-fixing/articleshow/13156492.cms?referral=PM

http://timesofindia.indiatimes.com/sports/cricket/ipl-2012/news/BCCI-suspends-5-cricketers-for-IPL-spot-fixing/articleshow/13156492.cms?referral=PM

http://www.pwc.com/en_GX/gx/hospitality-leisure/pdf/changing-the-game-outlook-for-the-global-sports-market-to-2015.pdf




http://www.emeraldinsight.com.ezproxy1.lib.asu.edu/journals.htm?articleid=853602&show=abstract#sthash.gLxA1Jy6.dpuf

http://www.emeraldinsight.com.ezproxy1.lib.asu.edu/journals.htm?articleid=853602&show=abstract#sthash.gLxA1Jy6.dpuf



17

11. Cornell, Stephen and Douglas Hartmann, 1998. "Ethnicity and Race: Making Identities in a Changing

World." p.3

12. Nitin Sunder (2009, December 18). Why $225 million isn't necessarily absurd. Retrieved May24,

2014 from http://www.espncricinfo.com/ci/content/story/440177.html 2009

13. GargiParsai. (2010, April 18). Tharoor quits after PM asks him to step down. Retrieved May24, 2014

from http://www.thehindu.com/news/tharoor-quits-after-manmohan-asks-him-to-step-

down/article402910.ece

14. Kumar, K. P. (2010, April 24). Despite IPL profits, team owners post losses. The Times of India.

15. Dalal, M., & Shah, G. (2014, February 11). IPL continues to score high in brand valuation. .

Retrieved May 21, 2014, from

http://www.livemint.com/Consumer/TKdsgMQQnt7dCJF864jAyJ/IPL-continues-to-score-high-in-

brand-valuation.html

16. Chilkoti, A. (2013, March 22). Sponsoring India’s IPL: how big a deal?. . Retrieved May 21, 2014,

from http://blogs.ft.com/beyond-brics/2013/03/22/sponsoring-indias-ipl-how-big-a-deal/

17. Pune and Kochi are new IPL franchises. (2010, March 21). . Retrieved May 21, 2014, from

http://cricket.rediff.com/report/2010/mar/21/ipl-2010-pune-kochi-new-teams.htm

18. Kochi franchise terminated by BCCI. (2011, September 19). . Retrieved May 21, 2014, from

http://www.espncricinfo.com/indian-premier-league-2012/content/current/story/532973.html

19. Schwartz, P. J., & Smith, C. (2009, August 27). In Pictures: What The IPL's Teams Are Worth. .

Retrieved May 21, 2014, from http://www.forbes.com/2009/08/27/cricket-india-ipl-business-sports-

ipl_slide.html

20. Basu, I. (2008, January 27). Does the IPL model make sense?.The Times of India.

21. ICC facing threat from India. (2006, January 3). . Retrieved May 21, 2014, from

http://www.espncricinfo.com/india/content/story/231378.html

http://www.espncricinfo.com/ci/content/story/440177.html%202009

http://www.thehindu.com/news/tharoor-quits-after-manmohan-asks-him-to-step-down/article402910.ece

http://www.thehindu.com/news/tharoor-quits-after-manmohan-asks-him-to-step-down/article402910.ece

http://www.livemint.com/Consumer/TKdsgMQQnt7dCJF864jAyJ/IPL-continues-to-score-high-in-brand-valuation.html

http://www.livemint.com/Consumer/TKdsgMQQnt7dCJF864jAyJ/IPL-continues-to-score-high-in-brand-valuation.html

http://blogs.ft.com/beyond-brics/2013/03/22/sponsoring-indias-ipl-how-big-a-deal/

http://cricket.rediff.com/report/2010/mar/21/ipl-2010-pune-kochi-new-teams.htm

http://www.espncricinfo.com/indian-premier-league-2012/content/current/story/532973.html

http://www.forbes.com/2009/08/27/cricket-india-ipl-business-sports-ipl_slide.html

http://www.forbes.com/2009/08/27/cricket-india-ipl-business-sports-ipl_slide.html

http://www.espncricinfo.com/india/content/story/231378.html



18

22. Indian Premier League Franchise Prospectus. (2007, December).. IMG Sports Entertainment Media.

McCormak House, London.

23. Indian Premier League-Archives. (2014, January 1). . Retrieved May 21, 2014, from

http://www.iplt20.com/archive/

24. http://articles.economictimes.indiatimes.com/2011-03-02/news/28649217_1_sportswear-giant-nike-

marketing-director-sanjay-gangopadhyay. (2014, January 1). Retrieved May 20, 2014

25. US Census. http://www.census.gov

26. http://thecommonwealth.org

27. Engineer, Tariq. Firstpost.Sports. http://www.firstpost.com/sports/bccis-approach-to-corruption-lets-

play-ipl-in-the-uae-1431049.html. Retrieved May 20, 2014

28. http://www.forbes.com/sites/chrissmith/2012/06/08/billionaires-like-warren-buffett-profit-from-

minor-league-baseball-ownership/

29. Linnell, Stephen; Shane Green (31 October 1996). "City to get $200m high-tech stadium".

Melbourne: The Age.

http://articles.economictimes.indiatimes.com/2011-03-02/news/28649217_1_sportswear-giant-nike-marketing-director-sanjay-gangopadhyay

http://articles.economictimes.indiatimes.com/2011-03-02/news/28649217_1_sportswear-giant-nike-marketing-director-sanjay-gangopadhyay

http://www.census.gov/

http://thecommonwealth.org/

http://www.firstpost.com/sports/bccis-approach-to-corruption-lets-play-ipl-in-the-uae-1431049.html

http://www.firstpost.com/sports/bccis-approach-to-corruption-lets-play-ipl-in-the-uae-1431049.html

http://www.forbes.com/sites/chrissmith/2012/06/08/billionaires-like-warren-buffett-profit-from-minor-league-baseball-ownership/

http://www.forbes.com/sites/chrissmith/2012/06/08/billionaires-like-warren-buffett-profit-from-minor-league-baseball-ownership/

http://150.theage.com.au/view_bestofarticle.asp?straction=update&inttype=1&intid=927

http://en.wikipedia.org/wiki/The_Age



19

Preliminary Reading List

-Bhushan, R., & Sharma, R. T. (2013, October 21). Rupert Murdoch and MukeshAmbaniTeam Up for

IPL-style Football League Next Year.Entertainment. Retrieved April 23, 2014, from

http://articles.economictimes.indiatimes.com/2013-10-21/news/43250531_1_star-india-indian-

badminton-league-indian-football

-(2014). IPLT20, from www.iplt20.com

-(2014). The Board of Control for Cricket in India. Retrieved April 23, 2014, from http://www.bcci.tv/

-Parker, D., Burns, P., & Natarajan, H. (2008, October 1). Player Valuations in the Indian

PremierLeague.Frontier Economics, 1-17.http://www.frontier-

economics.com/_library/publications/Frontier%20paper%20-%20IPL%20auctions.pdf

-Karmali, N. (2014, April 14). India's Rich and Famous Rush To Snatch Piece Of New Soccer League.

Retrieved April 23, 2014, from http://www.forbes.com/sites/naazneenkarmali/2014/04/14/indias-rich-

and-famous-rush-to-snatch-piece-of-new-soccer-league/

-Sahni, Jaspreet. “IPL Begins Search for an Image Makeover in its Seventh Season”. (April 2014).

Retrieved April 23, 2014, from

http://ibnlive.in.com/news/ipl-begins-search-for-an-image-makeover-in-its-seventh-season/465392-

78.html

-Hwartz, P. J. (2009, August 27). The World's Hottest Sports League. Retrieved April 23, 2014, from

http://www.forbes.com/2009/08/27/cricket-india-ipl-business-sports-ipl.html /

-Kohli, R. (2011, February 08). The Launch of the Indian Premier League.Columbia Case

Works,http://www.columbia.edu/~rk35/IPL.pdf

http://articles.economictimes.indiatimes.com/2013-10-21/news/43250531_1_star-india-indian-badminton-league-indian-football

http://articles.economictimes.indiatimes.com/2013-10-21/news/43250531_1_star-india-indian-badminton-league-indian-football

http://www.iplt20.com/

http://www.bcci.tv/

http://www.frontier-economics.com/_library/publications/Frontier%20paper%20-%20IPL%20auctions.pdf

http://www.frontier-economics.com/_library/publications/Frontier%20paper%20-%20IPL%20auctions.pdf

http://www.forbes.com/sites/naazneenkarmali/2014/04/14/indias-rich-and-famous-rush-to-snatch-piece-of-new-soccer-league/

http://www.forbes.com/sites/naazneenkarmali/2014/04/14/indias-rich-and-famous-rush-to-snatch-piece-of-new-soccer-league/

http://ibnlive.in.com/news/ipl-begins-search-for-an-image-makeover-in-its-seventh-season/465392-78.html

http://ibnlive.in.com/news/ipl-begins-search-for-an-image-makeover-in-its-seventh-season/465392-78.html

http://www.forbes.com/2009/08/27/cricket-india-ipl-business-sports-ipl.html%20/

http://www.columbia.edu/~rk35/IPL.pdf



20

Exhibit 1

List of current IPL teams

Current IPL teams

1. Chennai Super Kings (CSK)

2. Delhi Daredevils (DD)

3. Kings XI Punjab (KXIP)

4. Kolkata Knight Riders (KKR)

5. Mumbai Indians (MI)

6. Rajasthan Royal (RR)

7. Royal Challengers Bangalore (RCB)

8. Sunrises Hyderabad (SRH)

Defunct IPL Teams

Pune Warriors (PWI)

Kochi Tuskers Kerala (KTK)

Deccan Charges (DC)



21

Sources: Indian Premier League Financial Prospectus, 2007

Exhibit 2

Value Comparison: Television Rights by League & Sport

Cricket Leagues

Non-Cricket Leagues



22

Exhibit 3

Franchise Performance Summary

Year Team Result

2008

Rajasthan Royals (RR)

Kings XI Punjab (KXIP)

Chennai Super Kings (CSK) Delhi Daredevils (DD)

Mumbai Indians (MI)

Kolkata Knight Riders (KKR) Royal Challenge Bangalore (RCB)

Deccan Chargers (DC)

1

2

3 4

5

6 7

8

2009

DD CSK

RCB

DC KXIP

RR

MI KKR

1 2

3

4 5

6

7 8

2010

MI

DC

CSK RCB

DD

KKR RR

KXIP

1

2

3 4

5

6 7

8

2011

RCB CSK

MI

KKR

KXIP

RR

DC *Kochi Tuskers Kerala (KTK)

*Pune Warriors India (PWI)

DD

1 2

3

4

5

6

7 8

9

10

2012

DD

KKR

MI CSK

RCB

KXIP RR

DC

PWI **KTK

1

2

3 4

5

6 7

8

9 NA- Disbanded

2013

CSK

MI

RR

*Sunrisers Hyderabad (SH)

RCB

KXIP KKR

PWI

DD **DC

1

2

3

4

5

6 7

8

9 NA-Sold/Now SH

* New Franchise /** Franchise No Longer Exists (Sources: Indian Premier League Archives)



23

Sources:

1. Kumar, K. P. (2010, April 24). Despite IPL profits, team owners post losses. The Times of India.

2. Dalal, M., & Shah, G. (2014, February 11). IPL continues to score high in brand valuation. . Retrieved May 21, 2014,

3. Chilkoti, A. (2013, March 22). Sponsoring India’s IPL: how big a deal?. . Retrieved May 21, 2014 4. Pune and Kochi are new IPL franchises. (2010, March 21). . Retrieved May 21, 2014, 5. Kochi franchise terminated by BCCI. (2011, September 19). . Retrieved May 21, 2014 6. ICC facing threat from India. (2006, January 3). . Retrieved May 21, 2014,

Exhibit 4

IPL - Projected Revenues



24

Exhibit 5

SWOT Analysis

SWOT Analysis

Opportunities

1.) Foreign Markets

2.) Developmental Leagues

3.) Population growth in cricket

countries

4.) Oligopoly nature of many

SEI

5.) Internet/Satellite

Subscriptions

Threats

1.) Uncertainty of worldwide

economy

2.) Other Sports Leagues

(English Premiere League,

NBA, NFL)

3.) Global Rival cricket league

Strengths

1.)Players

2.) Brand Equity

3.) Finances (owners)

4.) TV contracts

5.) Sponsors

6.) Popularity (Huge Base)

7.) Stadium/Venue Control

Combine S1, S2,S3, S4 to go on

the offensive in O1 and O2.

Use strength of S1,S2 to go after

O5.

Use S3, S4 to minimize effects

of T1.

Use S1, S4, S1 to minimize

effect of T2, T3.

Weaknesses

1.) Match Fixing scandals and

impact on reputation

2.) Marketing skills

3.) Finances (league)

Shore up W1, W2 to take

advantage of O1, O3.

Improve W2 to take advantage

of O5.

Fix W3 to guard against T1.

Improve W3 to defend against

T2,T3.



25


Exhibit 6

Most Valuable Sports League Franchises



26


Exhibit 7

Value of Recent Franchise Expansions, 2000-2007

50.8% increase over 5 years





27

Exhibit 8

5- Forces / PESTEL Analysis

Intensity (low/ high

/ moderate) Source and Considerations

Threat of new entrants

Low to Moderate

1.) Always a threat of teams breaking away to form

their own league, such as football first division

of EPL

2.) Because of the time it takes to organize and then

compete against the incumbent, low and cost

factors for finding team owners

Supplier power

Low

1.) Players make up the teams, they can join

competing leagues

2.) 80 different official merchandising deals as of

2010

3.) The IPL Governing Counsel and BCCI set rules

teams must abide by (i.e. Player regulation,

retention)

4.) Several alternatives for hosting countries: India,

S. Africa, UAE, Bangladesh, Sri Lanka

5.) Several broadcast mediums due to profitability

and popularity: Time Internet, Star India,

YouTube, Sky Sports

Buyer power

Moderate

1.) Fans control what they spend and entertainment

is often first to go in an economic crunch such

as Indian Economy slump

2.) Fans affect TV ratings/revenues

3.) Sponsors control endorsements

Threat of substitutes

Moderate to High

1.) Other cricket leagues

2.) Other sports leagues, i.e. soccer, tennis (similar

fan base)

3.) A plethora of entertainment alternatives outside

the industry

Threat of rivalry

Low

1.) Not likely to have price wars

2.) Other leagues going after the same sponsors/fan

base

Adding a 6th force:

Synergies with

complements

Relevant

1.) The sale of merchandise, franchise

sponsorships, and ticket sales strengthen the

league’s profitability and global influence



28

Nature

(relevance /

dynamics)

Consider How P.E.S.T.L.E. Factors Affect Industry Forces

Political factors

Highly

Relevant

1.) 2014 season will not be played entirely in India

because the Lok Sabha election takes precedence in

security concerns

2.) Central Government minister ShashiTharoor involved

in controversial franchise bid which resulted in

resignation in 2011

Economic factors

Relevant

1.) Three former teams cease to exist because of financial

constraints: Pune Warriors India, Kochi Tuskers

Kerala, Deccan Chargers

2.) Insurance costs have risen for 2014 season (due to

election conflict)

Sociocultural factors

Highly

Relevant

1.) Projected onto world stage, however not all countries

follow as closely (U.S.)

2.) Significant followings within the colonially-influenced

nations of the world

Technological factors Relevant 1.) 1st Sport to stream on YouTube, helps gain traction

Legal factors Highly

Relevant

1.) Supreme Court of India has investigated spot fixing

and betting cases, but allowed auctions to continue

Ecological factors n/a



29

Exhibit 9

VRIO Analysis Valuable? Rare? Costly to Imitate? Embedded in

Organization?

Resource 1: Intellectual Property: BCCI

have complete control of cricket activities

in India. It works like a monopoly in 1.2

billion Indian Market

YES

Yes It will take years

to imitate what

BCCI has today-

path dependency

Yes

Resource 2: Strong Financial Position:

BCCI is the only board with maximum

revenue from cricket and enjoy tax exempt

status

Yes

Yes Yes- path

dependency;

social complexity

Yes

Resource 3: Brand Equity: The IPL is the

most famous league of all cricket leagues

worldwide. TheIPL has huge Indian and

overseas cricket audience market, thus, it

attracts many sponsors and add to prize

money, which is maximum in cricket

anywhere in world

Yes No Yes- path

dependency,

casual ambiguity,

social complexity

Yes

Other resources: Trademark: The IPL

one of the most famous brand name in

cricket.

Yes No Yes Yes

Capability 1: Ability to Attract Top

Talent: Contract with top Domestic and

Overseas Players which no other board

could secure at the time of inception

Yes

No Yes Yes

Capability 2: Venue Control: BCCI has

the control over all cricket stadiums in India

and can refuse to allow any stadium game

anytime to anyone

Yes Yes Yes-path

dependency

Yes

Capability 3: Global Influence: The IPL

has a secure slot in FTP so that no other

cricket event will run during the IPL. Thus,

availability of top foreign players is

possible.

Yes

Yes Yes-casual

ambiguity, social

complexity

Yes

Indian_Premier_League (IPL)_2014

Sports

Transcript of Indian_Premier_League (IPL)_2014