Many times peoples do think 🤔 that how IPL franchises make money? How IPL team owner buy a team? What IPL team's earnings ? What's the business model of IPL ?
IPL is as much about business as it is about cricket. In terms of valuation the IPL brand was worth $6.8 billion last year according to Duff and Phelps (a finance firm) HERE'S HOW IPL FRANCHISES MAKE MONEY?
MEDIA RIGHTS There is a revenue distribution model in the IPL, where the BCCI collects hefty revenue from the broadcaster and online streamer, and distributes close to 40% of that revenue among teams.
Besides that, the IPL franchises also make money from Broadcasting special shows such as KKR's Knight club. Media Rights reportedly forms a major proportion of a teams revenue.
SPONSORS There are 2 types of sponsors in IPL i) Brands that are sponsors for IPL (for eg- Dream 11) ii) Brands that tie up individually with teams. i) BCCI collects the money from the sponsors of IPL and distributes close to 40% of that among IPL teams.
ii) IPL teams individually tie-up with brands to offer visibility to the brands by Endorsing their logos on team kits and jerseys. Even the barricades near the boundaries form a part of the sponsorship revenue. IPL franchises generate a sizeable part of their revenue through brand sponsorships.
STADIUM REVENUE Revenue generated from the sale of tickets for matches played at home forms another source of income for the IPL teams. Teams also earn money by contracting food and beverage stalls in stadiums to third parties.
MERCHANDISING The franchises also make money from the sales of official merchandise like jerseys, souvenirs and sports equipment. However this industry is still in nascent stage in India.
PRIZE MONEY The prize money income is relatively smaller than other sources of income. Last year, MI pocketed Rs 20 Crore for winning the IPL. But winning the IPL builds the brand value of the franchise and helps in getting the best sponsors.
IPL is a way of allowing Corporate India into Indian Cricket's dressing rooms and is a perfect blend of cricket and commerce. IPL is not only a great cricket competition we all love but also a business masterstroke.
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