Bollywood star Ranbir Kapoor is not looking to dilute stake in Mumbai City FC, an Indian Super League (ISL) franchise. While there have been offers, Kapoor has made it clear that a stake in the team will not be sold.
The team is co-owned by Kapoor and Bimal Parekh, a chartered accountant. “When Kapoor got the team he knew that it would not be financially profitable for a few years.
Also, he isn’t involved to just be the face of the team. He is as involved as an owner can or should be. He is in it for the long run,” Mumbai City FC CEO Indranil Das Blah told TelevisionPost.com.
Mumbai City FC expects to achieve profitability in the ninth year and year-on-year breakeven in the fifth year. Blah said, “We are in the ISL for the long haul.
At the end of five years, we should be in a position to be close to breakeven for that particular year. In the ninth or tenth year, the franchise will be profitable. But there are variables.
If the league does really well, then we could achieve breakeven earlier. But if the league does not sustain itself, then obviously losses will mount. A realistic goal would be start breaking even per season from the fifth year.”
Revenue split: The franchise is looking at a 20 per cent revenue growth. Interestingly, 80 per cent of its revenue comes from local sponsorship and ticketing. 70 per cent of the local revenue comes from sponsorship.
Only 20 per cent of overall revenue comes from the central pool. A big reason for this is that the franchise does not get broadcasting rights revenue from the central pool.
“The ISL has gone out in the market and sold sponsorship centrally. Not having broadcast revenue from the central pool is not ideal.
Having said that, the amount that Star spends on production values for the event is of EPL (English Premier League) quality level and their investment in marketing balances things out.
We do not get broadcasting revenue, but we have a big conglomerate like Star completely invested in the ISL. Hence, I am not too worried about broadcast revenue because what you get in return is the pure might and reach of the Star network.”
Local sponsorship: The game plan in this area is to put quality over quantity. “We have set certain benchmarks in terms of pricing. It has been better this year as brands are aware of the ISL and how well it did last year.
However, brands tend to wait till the last moment and point out that we have a slot free and they want it at a lower price. We would rather keep that slot free than devalue our brand.
Most of our sponsor slots are filled in. We have one or two to fill, but we are willing to let that go if the market is not willing to pay accordingly,” Blah explains. The franchise has eight sponsors—some are on the jersey while others are either licensing deals or partnerships.
The Ace Group is the title sponsor. It has also tied up with a jewellery company which will create customised jewellery for the franchise members, both men and women.
“We are clear that companies have to give a fee and a media commitment. It could be either traditional or media. Luckily, our sponsors are active and have realised the need of leveraging the opportunity.
They committed to investing two times of the fee in activation and marketing. This is important for value in the deal to come through. It is important for people notice that we are doing interesting stuff. There needs to be a direct engagement with audiences of both the clubs and the sponsors,” he added. Blah also noted that activation for a real estate major will be different from what a car company does.
“We do not want to limit our sponsors’ and partners’ activation to just a TVC or an ad shoot. We want to look at innovative ways to leverage the relationship. Once we have decided on the sponsorship amount, our marketing and creative team sits down with theirs to figure how best to excite the audience and what is best for both parties. It is not just about taking the clients’ money.”
Giving the example of work done with IDBI last year, he said that the bank has a huge network. Tickets were sold at various branches. There was branding done at those branches.
Tickets were discounted or given away as prizes for contests. “Nevertheless, last year things were done at the last moment. We couldn’t activate well. This time planning started well in advance. A premium watch brand might not want too much activation. It might want to be in the VVIP area.
The Ace Group wants to reach out to a certain audience,” he added. Short-term deals: Deals are for one or two years. “All the deals are for either one or two years. As a franchise we are not comfortable with a three-year deal as there are many variables.
The league might become bigger than anticipated and then you don’t want to be in a situation where you have undersold.” From next year though, the franchise might look at doing three-year deals.
Read more at: Bollywood star Ranbir Kapoor not to dilute stake in Mumbai City FC | TelevisionPost.com | TelevisionPost.com
The team is co-owned by Kapoor and Bimal Parekh, a chartered accountant. “When Kapoor got the team he knew that it would not be financially profitable for a few years.
Also, he isn’t involved to just be the face of the team. He is as involved as an owner can or should be. He is in it for the long run,” Mumbai City FC CEO Indranil Das Blah told TelevisionPost.com.
Mumbai City FC expects to achieve profitability in the ninth year and year-on-year breakeven in the fifth year. Blah said, “We are in the ISL for the long haul.
At the end of five years, we should be in a position to be close to breakeven for that particular year. In the ninth or tenth year, the franchise will be profitable. But there are variables.
If the league does really well, then we could achieve breakeven earlier. But if the league does not sustain itself, then obviously losses will mount. A realistic goal would be start breaking even per season from the fifth year.”
Revenue split: The franchise is looking at a 20 per cent revenue growth. Interestingly, 80 per cent of its revenue comes from local sponsorship and ticketing. 70 per cent of the local revenue comes from sponsorship.
Only 20 per cent of overall revenue comes from the central pool. A big reason for this is that the franchise does not get broadcasting rights revenue from the central pool.
“The ISL has gone out in the market and sold sponsorship centrally. Not having broadcast revenue from the central pool is not ideal.
Having said that, the amount that Star spends on production values for the event is of EPL (English Premier League) quality level and their investment in marketing balances things out.
We do not get broadcasting revenue, but we have a big conglomerate like Star completely invested in the ISL. Hence, I am not too worried about broadcast revenue because what you get in return is the pure might and reach of the Star network.”
Local sponsorship: The game plan in this area is to put quality over quantity. “We have set certain benchmarks in terms of pricing. It has been better this year as brands are aware of the ISL and how well it did last year.
However, brands tend to wait till the last moment and point out that we have a slot free and they want it at a lower price. We would rather keep that slot free than devalue our brand.
Most of our sponsor slots are filled in. We have one or two to fill, but we are willing to let that go if the market is not willing to pay accordingly,” Blah explains. The franchise has eight sponsors—some are on the jersey while others are either licensing deals or partnerships.
The Ace Group is the title sponsor. It has also tied up with a jewellery company which will create customised jewellery for the franchise members, both men and women.
“We are clear that companies have to give a fee and a media commitment. It could be either traditional or media. Luckily, our sponsors are active and have realised the need of leveraging the opportunity.
They committed to investing two times of the fee in activation and marketing. This is important for value in the deal to come through. It is important for people notice that we are doing interesting stuff. There needs to be a direct engagement with audiences of both the clubs and the sponsors,” he added. Blah also noted that activation for a real estate major will be different from what a car company does.
“We do not want to limit our sponsors’ and partners’ activation to just a TVC or an ad shoot. We want to look at innovative ways to leverage the relationship. Once we have decided on the sponsorship amount, our marketing and creative team sits down with theirs to figure how best to excite the audience and what is best for both parties. It is not just about taking the clients’ money.”
Giving the example of work done with IDBI last year, he said that the bank has a huge network. Tickets were sold at various branches. There was branding done at those branches.
Tickets were discounted or given away as prizes for contests. “Nevertheless, last year things were done at the last moment. We couldn’t activate well. This time planning started well in advance. A premium watch brand might not want too much activation. It might want to be in the VVIP area.
The Ace Group wants to reach out to a certain audience,” he added. Short-term deals: Deals are for one or two years. “All the deals are for either one or two years. As a franchise we are not comfortable with a three-year deal as there are many variables.
The league might become bigger than anticipated and then you don’t want to be in a situation where you have undersold.” From next year though, the franchise might look at doing three-year deals.
Read more at: Bollywood star Ranbir Kapoor not to dilute stake in Mumbai City FC | TelevisionPost.com | TelevisionPost.com
