Everything you need to know about How IPL Teams Make Money | 7 Ways by which IPL Franchises Make Money

Games in India have a long history dating back to the medieval period, so we’re talking about the IPL (Indian Premier League), A domestic tournament of cricket. Yes, you’re all aware of the IPL craze and the fan base that follows it in India. There are various things regarding cricket that we must be aware of. So, in this essay, you will first learn about the IPL program, and then you will learn about how IPL teams create Profits for them.

• What is IPL and How Many Teams Participate in this Tournament?
• IPL Team Names and their Owners
• Ways through which Indian Premium League Teams Make Money
• Indian Premier League Business Model
• What do we mean by IPL merchandise?
• What is the IPL revenue?
• Which IPL team is the most successful?

What is IPL and How Many Teams Participate in this Tournament?

The Indian Premier Tournament (IPL) is a premier men’s T20is cricket league in which ten teams compete from ten different cities across India. The BCCI (Board of Control for Cricket in India) started the league in 2007. It is conducted every year between March and May and has a special slot in the ICC Future Tours Programme.

The IPL is the most popular cricket league in the world, ranking sixth across all major sports in terms of average attendance in 2014. In the IPL, all of the world’s cricket players compete (except the players of the Pakistan team). With 31.57 million average impressions and a 23 percent increase in overall ingestion over the 2018-19 season, the 2020 IPL season broke a tremendous viewership record. The IPL league has spanned fourteen seasons. The Chennai Super Kings are the present IPL champions, having won the 2021 season. The tournaments were moved to the UAE because of covid.

IPL Team Names and their Owners

Ways through which Indian Premium League Teams Make Money | IPL Teams Business Model

The IPL has created a great deal of interest among individuals around the globe. However, owning an IPL franchise isn’t all fun and games. It’s a business, after all. Even though the franchise is well-known for its cricket, it thrives on money.

The IPL has sought the help of a few of the country’s most big organizations and personalities to run their franchises.
Given the event’s popularity, one would question what motivates these business owners to invest crores each year. To put it another way, how do IPL franchises make money?

Media Rights

Broadcasting rights are the most important source of financing for IPL participants. The BCCI buys media rights for broadcasters, and the revenue is split among the teams once the BCCI’s portion is deducted. Until now, the tournament has been broadcast live by Sony Sports Network and Star Sports Network.

From 2008 to 2017, Sony Entertainment probably paid 8,200 crore INR (about $820 crore per season) for the broadcasting rights to the IPL. In 2018, Star Sports Network paid a reported amount of 16,347 crores INR for the right to the IPL for a five-year deal. Between the two deals, all wealth has shifted dramatically.

The broadcast rights are the IPL teams’ major source of revenue. The BCCI purchases the tv rights from the broadcasters, and the proceeds are distributed to a team after which the BCCI’s portion is deducted. The IPL’s title sponsorship contributes significantly to the revenue stream. For the next two seasons, the TATA group will pay the BCCI INR 335 crores to be the title sponsor. The BCCI retains 50percent of the total earnings for itself, while the rest is dispersed among the franchisees.

Ticket Sales/Gate Revenue

Covid has been in the marketplace since IPL 2020, but before that, ground revenues were a significant source of income. The franchises receive 80 percent of ticket sales money, whereas there are many alternative earnings in the local market as well. However, if someone had an IPL franchise, they could earn a lot of money. Ticket sales revenue is among the most essential sources of income for IPL clubs.

Ticket sales are anticipated to account for 15% of the income produced by IPL franchises. A large amount of the cash produced from ticket sales goes to the owners of the teams. Each club plays seven games at home, with the home match ticket awards determined solely by the team owners.

A percentage of the tickets are kept by BCCI and sponsors, while the rest goes into the team’s wallet. When you throw in the cost of food and beverages, you’ve got a big bill. The home team receives a large share of the total prize money. They rely heavily on this kind of earnings because IPL really does have tremendous popularity in India and thousands of supporters attend live matches.

Selling Stake

The IPL franchisees also profit handsomely from the sale of team shares. Delhi Capitals is a recent example. The GMR company acquired this IPL license for 84 million USD in 2008. It’s an uncommon method to make more money, but can be an excellent idea to create a small bit of money.

Advertisements & Promotions

Advertisements, television, and online streaming all have a lot to offer. Currently, the IPL has been the most televised annual sporting event, so it delivers significantly to the total revenue. According to estimates, Star charges Rs. 12.5 lakhs for each 10-second commercial during a match. Consider the revenue that would be generated over the course of the nearly 40-day season.

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Sponsorship

IPL teams are making a large amount of money through the sale of authorized IPL products. Official jersey reproductions, sports mementos, and sports equipment are just a few of the items available as part of the IPL goods. Every team has its sponsors, who are a significant source of revenue for the teams. Every team has a slew of sponsors surrounding their uniforms.

Everything in the stadium does have a price, from the participants’ bats to the bails and stamps. In the Indian Premier League, sponsorships are the key stream of revenue. Every IPL team has sponsors for everything: the primary sponsor, the jersey sponsor, and even the sleeve sponsor, all of which contribute importantly to the overall revenue.

Prize Money

Prize money is one of the franchise’s main sources of income. The tournament’s winning team receives the prize money. Teams are awarded prize money based on their position in the rankings. CSK managed to win the VIVO IPL 2021 and received a prize of 20 crores. Similarly, KKR was awarded 12.5 crores for finishing second. The prize money for the IPL is dispersed in this manner. This is the most popular method of generating revenue.

Promotion through Brand Value

The team benefits greatly from brand value. You stand a higher chance of recruiting brands and financiers if you do have performers like Virat Kohli, MS Dhoni, or even AB de Villiers on your squad. Winning the IPL and even reaching the Playoffs boosts the brand image of IPL clubs. As a result, getting brands on board is much easier — and at costs that the owners expect.

Indian Premier League Business Model

FAQs on How does the IPL Teams Work Financially

1. What do we mean by IPL merchandise?

T-shirts, key chains, jerseys, polo t-shirts, phone covers, chargers, caps, joggers, coasters, wrist bands, and other IPL items are available, Which is known as IPL merchandise.

2. What is the IPL revenue?

Though specific estimates for the IPL revenue could not be determined, it has been estimated that the IPL revenue accounts for 40% of all cricket revenue globally.

3. Which IPL team is the most successful?

With five IPL titles to their name, MI is the most successful team in league history, while CSK is the second most successful club, having won the title four times.

Conclusion

The Indian Premier League (IPL) is a profitable enterprise and a worldwide celebration of cricket. Cricket fans from all over the world flock to India to observe the IPL, which takes place over seven continents. We’ve learned about the various sources of income for the IPL franchise in this article, as well as why it’s one of the most profitable business ventures. You can even know about How Credit Card Companies Make Money.