7 Ways The Indian Premier League Makes Money | How IPL Makes Money

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The Indian Premier League Makes Money by these 7 methods-

1. Sponsorship – Sponsorships from companies like Byju’s.

2. Media and Streaming Rights – Selling rights to companies like Hotstar.

3. Ticket Selling – Selling stadium tickets.

4. Merchandise – Selling IPL merchandise.

5. Selling Stake in companies.

6. Prize money in IPL

7. Brand Collaboration with other companies and star cricket players.

First and foremost we have to agree that the main motive of the Indian Premier League is to make revenue and profit. And this year also IPL is going to be no different, it sure is going to be a 3-month long entertainment for a large part of our nation, along with that it is going to provide direct and indirect income source to thousands of individuals.

IPL also provides a fair chance to new and experienced Cricketers from around the world to showcase their talents by being a part of IPL auctions.

If we talk about the money, the Indian Premier League makes the most amount of its money by selling its teams or franchises to private sector investors, individuals or businesses. These Cricket teams and franchises are sold at prices of 100’s crore Rupees. These teams then further buy their team players as part of the IPL auctions, here a single player could be worth from a few lakh rupees for a new player to a few crores for a famous player in a good shape.

It is a point to note that the most expensive player in IPL history is Chris Morris, who is an all-rounder cricketer from South Africa. In the IPL auction, Chris Morris was bought by Rajasthan Royals for Rs 16.25 Crore, with bidding starting from Rs 75 lakh.

After putting in all the investments into their teams, team owner makes their profits from sponsorships and merchandising. And these sponsorships and merchandising deals are easily worth hundreds of Crore rupees.

With each passing year, IPL has made more and more money. In 2015 Indian Premier League contributed ₹11. Billion to the Indian Economy. So, now let’s get into the business and talk about the 7 ways Indian Premier League makes money.

1. Sponsorships in IPL

Sponsorships are the major source from which The Indian Premier League Makes Money. Everything in IPL, be it the player’s jersey, bat, wickets, stadium seats and even the stadium boundaries have the sponsors name on them and these sponsorships are purchased at a high price.

Over time lot of brands and in recent times, startups like Dream11, Paytm etc are sponsoring IPL teams using their fundings. Advertisements of many companies or startups can be found on the team’s jersey. Up to 10 brand logos can be found on the team’s jersey’s, including 6 logos in T-shirts, 2 on their pants and 2 on their caps.

These brands can also be found advertising on cricketer’s as well as team’s social media accounts.

2. Selling IPL Teams Stake

BCCI makes huge profits by selling IPL teams to private investors and companies. The teams are sold for a huge sum of money, as they provide bigger returns for the one buying the teams. These are the IPL teams and their net worth in 2019 :

IPL Team Name	IPL Team Worth
Rajasthan Royals	Rs 297 Crores
Mumbai Indians	Rs 780 Crores
Kolkata Knight Riders	Rs 718 Crores
Royal Challengers Banglore	Rs 676 Crores
Chennai Super Kings	Rs 676 Crores
Delhi Capitals	Rs 359 Crores
Kings XI Punjab	Rs 359 Crores
Sunrisers Hyderabad	Rs 483 Crores

3. Brand Value Provided By IPL

Besides making money directly from selling teams, tickets or advertisements, another thing the Indian premier league provides is Brand value.

For an IPL team with star players like Mahendra Singh Dhoni, Virat Kohli, Hardik Pandeya, it gives a lot of edge and popularity to the team in terms of popularity and in turn high brand deals for teams and the players as well. Teams with start players usually tend to retain these star players for the next season just to maintain their brand value.

Also, not just famous players, but the famous team owners like Shah Rukh Khan or Shilpa Shetty also attract a lot of media attention and in return a good business boost for their sponsors.

4. Indian Premier League Merchandise

Merchandising provides a big chunk of profits earned for the IPL teams. And not just IPL teams, but merchandising also provides an income source to many 3rd party sellers in India, which accounts for a good seasonal income for these sellers.

IPL Merchandise includes the team jersey, caps, sports equipment, and even a lot of IPL memorabilia as well.

The IPL merchandise market is worth more than 30 million dollars. Each team sells their own official merchandise, either directly or with a 3rd party merchant.

You can check the official Mumbai Indians merchandise here: click here

5. IPL Media Rights

Every major company or startups lineup to be the title sponsor in the Indian Premier League. Over the years companies like Vivo,oppo, sony and now Dream 11 have sponsored the IPL.

BCCI is responsible for selecting the sponsors and selling the IPL sponsorships in return for a huge chunk of money. BCCI itself keeps their share from IPL sponsor and distributes the rest to all the Teams, depending upon their ranking.

The other form of Media Rights includes selling the TV rights and online streaming rights for the live telecast of IPL matches. This form the biggest learning source for IPL. IPL streaming rights for the entire season costs Rs 163.5 Billion, this is for the entire 300 matches. This makes a single IPL match at an average of Rs 545 Million. The money earned from selling media rights is further distributed among the IPL teams as per the team ranking. IPL Media rights account for up to 70 % of total sources, of how the Indian Premier League Makes Money.

6. Indian Premier League Makes Money by Selling Match Tickets

Another major source of Income for IPL has always been selling stadium tickets. And going from previous trends IPL stadium has always been jam-packed. Ticket sales account for a major portion of total IPL income every year excluding the year 2021 because of Covid-19.

Since each team in IPL gets to play at least 7 matches, each of them gets an equal chance to earn through match tickets. Each team is given a 10% share of the revenue earned from the tickets sold. This is one of the oldest methods for a sport to earn revenue, directly from its viewers and fans.

7. Prize Money Distribution

As per the records of 2019 IPL, the winning team was awarded Rupees 25 Crores, followed by Rs 12.5 Crores awarded to the 1st runner up and Rs 10.5 Crores and 8.5 crores to the 2nd and 3rd runner ups in the playoffs.

This source of revenue is only for the teams and the individual team players. The largest prize money is given to the winning team and then this money is divided amongst the team players and the team owners.

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