IPL is valued at $2bn and KKR is the richest team – Are you kidding me?

IPL as a business proposition is valued at $2bn and Kolkata Knight Riders (KKR) team is the richest in terms of brand value. My first reaction was WTF. Second reaction was – are you kidding me? Third reaction – let’s look at the data.

The valuation is done by Brand Finance which has done other valuations for Indian companies. It is the company which placed Bharti Airtel among the top 25 global telecom brands.

If it is from any other source I would have rubbished the report. But, it is coming from Brand Finance and I respect that. Traditional media has reported this and I tried to search the website of Brand Finance but nothing came up. I will leave at that.

Brand Finance took various things in valuing the brand. Most of the things were relevant if the tournament was conducted in India.

1. Revenue lines such as broadcasting,
2. IPL sponsorship,
3. Team sponsorship,
4. Merchandising and gate receipts
5. The effect of performance,
6. The catchment population of the city,
7. The capacity of the stadium
8. The presence of iconic players

Look at the things which Brand Finance has considered it all fits. But, only if the tournament is conducted in India. The reasons 6, 7 and 8 above are all in favor of Kolkata Knight Riders team because of the stadium capacity (Eden Gardens) and the population of Kolkata city.

In fact except the effect of performance everything else is in favor of Kolkata Knight Riders. This explains why KKR is the richest team on the circuit. But, that still does not explain their pathetic performance on the ground.

“Despite propping up the bottom of this year’s edition of the IPL taking place in South Africa, the Kolkata Knight Riders are the most valuable franchise brand at USD 42.1 million. Celebrity co-owner Shah Rukh Khan’s hard-selling of the KKR brand has counteracted the team’s poor on-field performance,” Brand Finance said. (DNA India)

Kolkata Knight Riders is more a fancy dress competition than a cricket team. Still they have managed to bring up a better valuation for the team. All of it goes it the superstar Shah Rukh Khan and Brand Finance did not mention that. Without Shah Rukh the team got nothing to show. So, if Shah Rukh sells, whoever buys it might have to take a few million off the price for brand Shah Rukh.

Rajasthan Royals is the other team which returns maximum revenue on your investment. Shilpa Shetty will be mighty pleased about this.

Brand valuations of the IPL teams :

1. Kolkata Knight Riders  – $42.1 million
2. Mumbai Indians  – $41.6 million
3. Rajasthan Royals – $39.5 million
4. Chennai Super Kings – $39.4 million
5. Delhi Daredevils – $39.2 million
6. Royal Challengers Bangalore – $37.4 million
7. Kings XI Punjab – $36.3 million
8. Deccan Chargers – $34.8 million

The valuations are an arbitrary number based on some calculations and does not reflect the real value of the team. The reason for Mumbai Indians being a better brand just behind KKR is because of the list of sponsors Mumbai has. It has 11 sponsors and KKR has 10 sponsors. Rajasthan Royals has only 3 sponsors to its credit.

Clearly this is not about cricket. It has moved beyond cricket and is at a place where no body yet knows what it is.  And I thought it was about cricket – silly me.

If you are still not convinced, let me leave you with this quote from the Fake IPL Player.

We are being paid by the 200 Million Indians who are following this tournament. Everybody who has put in money – the tournament organisers, TV channels, team owners etc. – sell rights and properties to brands and earn big profits. The brands, who have already paid millions, put in a few millions more and advertise on every inch they can lay their hands on. Eventually, all you guys who have spent 4-8 hours in front of your TV watching a little bit of cricket and a lot of advertisements go out to the market and purchase the colas, the mobile phones, the clothes, and the potato chips that you didn’t really need. And that’s how brands make their profit – from every rupee of your hard earned money that you spend on them.

Two, some others have been asking me if the matches are fixed. I want to ask you, why fix matches when you can fix the game? You take a 5-day game, make it into a day game, and then further shorten it to a 3.5 hour game. Throw in scantily dressed dancers, cleavage-showing anchors, beauty contests, dumb ass commentators with stupid jokes. And some seriously good competitive cricketers. And you have a magic potion that can hypnotize 200 Million people for 4 hours every day for more than a month. That 200 Million population has more money in their hands than any betting syndicate in the world. The game’s about your time and your money. On the issue of fixed matches, having seen guys like Aila, Sheikh, Lordie, Priest, Deewar from fairly close quarters now, I can tell you that no amount of money can lure them to lose a match intentionally. (Fake IPL Player)

What do you think about brand IPL and brand KKR?