PepsiCo Exits as IPL Title Sponsor, Replaced by Tech Giant Paytm

Strategic Insights -

PepsiCo, one of the world's largest snack and beverage companies, has announced its exit as the title sponsor of the Indian Premier League (IPL), the world's richest T20 cricket tournament. The company, which held the title rights from 2013 to 2017, had paid a whopping Rs 396 crore for a five-year deal. The move comes after a series of match-fixing scandals and allegations of biased conduct by former BCCI president N Srinivasan. Paytm, a mobile-commerce and payments major, is expected to take over as the new sponsor, with BCCI reportedly not renegotiating the original sponsorship fees.

Key Takeaways:

  • PepsiCo had initially signed a five-year deal with BCCI in 2012 for Rs 396 crore, which was nearly double the amount paid by previous sponsor DLF for the same period.
  • The company had expressed dissatisfaction with the cricket board's handling of match-fixing scandals and alleged biased conduct by N Srinivasan, which had brought disrepute to the Pepsi brand.
  • Paytm is expected to take over as the new title sponsor, with BCCI not renegotiating the original sponsorship fee.
  • PepsiCo had spent a significant portion of its yearly marketing budget on the IPL, but now feels that the association is no longer beneficial to its brand.
  • Paytm, which had sponsored India's home cricket matches earlier, is still weighing the pros and cons of taking over as the IPL title sponsor.

Statistics:

  • PepsiCo spent Rs 396 crore for a five-year deal as the IPL title sponsor.
  • The company paid nearly Rs 80 crore more than Bharti Airtel, the other bidder.
  • Paytm spent Rs 203 crore to become the title sponsor of India's home cricket matches until 2019.
  • Based on the new deal, Paytm will pay Rs 2.42 crore per home international fixture played by the Indian cricket team for four years.
  • The IPL's new sponsor will not have to pay the remaining Rs 150 crore of the original sponsorship fees.

Sources:

  • "PepsiCo to be replaced as IPL title sponsor, Paytm likely to take over" by Live Mint, unnamed sources.
  • "PepsiCo sends notice to BCCI, cites match-fixing and biased conduct of Srinivasan" by Hindu, unnamed sources.
  • "Paytm wins rights to sponsor India's home matches, pays Rs 203 crore" by DNA, named source - One97 Communication.
  • "India cricket sponsorship: Paytm makes Rs 203-crore IPL deal; what this means for the industry" by Business Standard, unnamed sources.