A number of sponsors are deserting Indian Premier League (IPL) teams or tweaking their deals with team owners as the tournament moves
to South Africa in its second season and the slowdown continues to hurt firms across industries.

Companies like financial services firm Religare, insurer Bajaj Allianz and realty player HDIL have terminated deals with IPL teams, while soft drink major Coca-Cola and mobile service provider Virgin Mobile have decided against some new ties.

Also, almost all existing sponsors have re-opened deals with their respective team franchisee partners, and are either seeking compensation, more privileges for the same money, or better deals for season three in cases where they have inked multi-year deals.

“Things are not as rosy as they were last year. We are trying to tweak our deals in a manner that our sponsors get more value for their investments,” said Rajasthan Royals chief marketing officer Raghu Iyer. He confirmed that Bajaj Allianz has terminated its sponsorship deal with the team. “We have done an out of court settlement with our former sponsor Bajaj Allianz, and have mutually terminated our agreement. They will not be associating with us,” Mr Iyer said.

Religare has pulled out as associate partner of GMR-owned Delhi Daredevils. When contacted, GMR Sports CEO Amrit Mathur confirmed: “Religare is no longer associated with Delhi Daredevils.” The two had entered into a multi-year tie-up last year. HDIL is no longer title sponsor of Kolkata Knight Riders (KKR), confirmed a KKR spokesperson.

Coca-Cola, which was on the verge of signing a sponsorship deal with Deccan Chargers, has stalled its plans. Virgin Mobile is also learnt to have pulled back a proposed licensing deal with Delhi Daredevils as official mobile partner.

“We have not yet entered into any agreement with any team for IPL season two,” confirmed a Virgin Mobile spokesperson. While most IPL franchisees are having a tough time fixing their corporate teams for IPL-2, the Reliance-owned Mumbai Indians seems to have no such tension.

“Several new marquee brands are supporting Mumbai Indians this season, even under a changed economic environment. It is a huge vote of confidence in the potential of our team,” Mumbai Indians team owner Nita M Ambani said.

Pernod Richard has inked a deal with the team as official partner for spirits and wines. Wrigley, PepsiCo, MasterCard, Kingfisher and Adidas are the other sponsors. A team spokesperson said talks are on with players in the insurance, pharmaceuticals, electronics, travel and tea company for additional sponsorships.

Beverage makers PepsiCo and Coca-Cola, meanwhile, are in the process of re-working their plans, since home ground beverage partner benefits like on-ground activation, in-stadia visibility and engaging with home crowds are lost.

Summer being peak season for soft drinks, the companies had tailored elaborate on-ground activation plans to leverage on IPL.

PepsiCo, for example, had tied up with Mumbai Indians and Chennai Super Kings as pouring rights and hydration partner. Rival Coca-Cola had fought a close battle with PepsiCo to ink a deal for its Sprite brand as KKR’s associate sponsor and pouring partner. Coca-Cola is also renegotiating its deal with Delhi Daredevils. A Coca-Cola India spokesperson said: “Having signed up as associate sponsors of KKR and Delhi Daredevils for our brands Sprite and Coca-Cola respectively, we are now looking forward to season two.”

Companies like sport gear maker Puma, which is a merchandise partner for Rajasthan Royals and Deccan Chargers, and Hero Honda continue to bet on IPL despite the shift in venue. “We will shift on ground promotional activities to South Africa, though our in-store promotions will continue in India,” said Puma India’s CEO Rajiv Mehta.

Advertisers too are learnt to be re-working on-air deals with broadcaster Sony Entertainment. They argue that with a number of matches scheduled for 4 pm, the prime time on-air advantage will be impacted.
Source – economictimes.indiatimes.com