With eight IPL team rights, PepsiCo hopes for a shiny summer

Company betting big with Rs 150-cr spend; rival Coca-Cola to spend just Rs 20-25 cr

With an estimated expenditure of Rs 150 crore during this year’s edition of the Indian Premier League (IPL) cricket tournament, PepsiCo India is betting big on the summer season.

Typically, the summer accounts for 30-35 per cent of the annual sales of soft drink companies.

PepsiCo India, the title sponsor of IPL 2013, today announced it had tied with eight IPL teams (excluding Mumbai Indians) as exclusive beverage partner for this year’s edition (April 3-May 26). The company has also signed a co-presenting broadcast sponsorship deal with Multi Screen Media (MSM), owners of the SET Max channel, which would broadcast the tournament.

Rival beverages major Coca-Cola has said it would spend just Rs 20-25 crore in spot advertisements for IPL, according to a company source. Coca-Cola, which had tied with five IPL franchisees during the previous season, wouldn’t renew four of those deals (excluding the deal with Mumbai Indians, as this contract is yet to expire). Also, Mumbai Indians captain Sachin Tendulkar is a Coca-Cola brand ambassador.

Sources say of the Rs 150 crore, PepsiCo would have to spend about Rs 80 crore for the title sponsorship. In November 2012, it had bought the title sponsorship rights for Rs 396.8 crore for five seasons, starting this year. The company would also have to spend about Rs 50 crore on co-broadcasting arrangements with MSM. The rest would be spent on advertisements and other promotional activities.

PepsiCo’s association with the eight teams would be extended to its food and beverages portfolio, including Pepsi, Mountain Dew, 7UP, Mango Slice, Mirinda, Aquafina, Tropicana, Lay’s, Kurkure, Aliva and Quaker Oats.

The team partnerships, along with the title sponsorship, would ensure visibility and engagement for the company’s brands, PepsiCo said in a statement today.

While Delhi Daredevils would campaign for both Pepsi and Mountain Dew, Kolkata Knight Riders and Pune Warriors would promote Pepsi.

Rajasthan Royals and Kings XI Punjab would promote Mountain Dew. Chennai Super Kings, The Sunrisers Hyderabad and Royal Challengers Bangalore would campaign for 7UP.

“We believe winning the title sponsorship of Pepsi-IPL was just the beginning. We are committed to back it with smart, strategic and high-decibel marketing and activation plans that would help us maximise the tournament’s potential,” said Gautham Mukkavilli, chief executive (beverages), PepsiCo India.

In the past few years, IPL has been weighed down by low viewer interest, owing to controversies and a predictable format. According to a Brand Finance report, currently, IPL’s brand value stands at $2.92 billion, compared with $4.13 billion in 2010. Television ratings for the tournament have fallen from an average 4.81 in the inaugural edition to 3.27 in the fifth season.