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Telecommunications equipment industry

Advertisers Seek Compensation from ESPN Star Sports After India's Early Exit from T20 World Cup

Strategic Insights

— 1 min read

Following India's early exit from the T20 World Cup, advertisers are seeking compensation from broadcaster ESPN Star Sports (ESS) for the shrinking viewership. These advertisers, who had committed Rs 180 crore to the tournament, want ESS to make up for the loss of viewership based on cost per ratings point (CPRP). The CPRP is a ratio used to analyze the cost benefit of an overall media campaign. The compensation could be in the form of reduced ad rates for subsequent tournaments, package deals, or bonus ad spots in forthcoming cricket series on ESS.

Key Takeaways:

  • Advertisers like Reliance Mobile, Hero Honda, PepsiCo, Reebok, and Max New York Life had committed Rs 180 crore to the tournament.
  • The marketers want ESS to make up for the loss of viewership based on cost per ratings point (CPRP).
  • The CPRP is a ratio used to analyze the cost benefit of an overall media campaign.
  • Advertisers are seeking compensation in the form of reduced ad rates for subsequent tournaments, package deals, or bonus ad spots.
  • GroupM-owned MindShare's south Asia leader R Gowthaman stated that the compensation would be a function of which advertiser has invested how much, and the terms of compensation would be worked out individually.
  • ESS declined to comment on a specific query about compensating advertisers, but its regular clients appeared confident of being compensated.
  • Anil Dua, vice-president for marketing and sales at Hero Honda, stated that the company would work out future deals in a manner that gets compensated for the loss of investment in this series.

Statistics:

  • Rs 180 crore: The amount committed by advertisers to the tournament.
  • 20-25%: The premium over the last T20 World Cup's ad prices.
  • Rs 2.7 lakh to Rs 4 lakh: The ad rates for 10 seconds.
  • 2.2-1: The average ratings of most non-India matches, according to media tracking firm TAM's data.
  • 3-3.5: The typical rating below which would cause concern, according to Anisha Motwani, senior vice-president with Max New York Life.

Sources:

  • "Advertisers seek compensation from ESPN Star Sports after India's early exit", By Ratna Bhushan & Meenakshi Verma Ambwani in Economic Times, 11 October.
  • "CPRP: A ratio to analyze the cost benefit of an overall media campaign".
  • Data from media tracking firm TAM.

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