With the growing popularity of sports in India, the business aspect of the industry is also witnessing steady growth.
India has witnessed a surge in terms of business in the sports eco-system. In the last few years, there has been a clear spike in terms of investments and funding in the Indian sports market. Market analysts believe India’s potential success in sports can become the platform for generating high revenues. The Indian sports and fitness goods market grew at a CAGR of 9 percent during 2014-2019.
Considering the popularity of various sports amongst the second most populated country in the world, India always had the potential to become a marketing giant in sports. The population of India is equivalent to around 18% of the total world population. A large share of its current population is represented by the young generation, becoming a target consumer base for sports and fitness products.
The Indian sports and fitness goods market reached a value of $3,621 million in 2017. As per a report from Media Partners Asia, the market value is expected to soar to $6,054 million by the end of 2024, showing a CAGR growth rate of 9 percent.
Introduction of sports leagues was the game changer
The growth of new sports leagues over the years has played a pivotal role in anchoring the sports business in the country. IPL was the biggest game-changer. Since the inaugural season of IPL in 2008, sports business has changed for the better every year.
With more than 1.02 billion impressions and close to $2.55 billion in broadcasting deals, IPL has become one of the most popular leagues in the world. The attractive cricket tournament is now worth over $6.3 billion.
Similarly, the Indian Super League enjoyed a remarkable 2019-20 season with a record 34 million viewers tuning in to the opening match between ATK and Kerala.
Pro Kabaddi League raked in a record 1.2 billion impressions, while Premier Badminton League (PBL) also reached 200 million TV units in its 2018-19 season. Pro Volleyball league has also done reasonably well, creating a niche in the market.
Rise in Sponsorship and Advertising revenues
According to a report from ESP Properties, the entertainment and sports division of GroupM India, the sports sponsorship in India during 2019 crossed the ₹9000 crores mark with a growth of 25% on-ground sponsorship.
This number itself speaks about the investments that are made into various sports and leagues by the brands and corporates. There was an upsurge of ₹1347 crores with media spends contributing to ₹800 crores, witnessing a growth rate of 18 percent.
Digital media saw a steep growth of 84 percent from ₹475 crores to ₹875 crores. Apart from this growth, nearly three-fourths of the market is dominated by online and mobile gaming platforms. According to Google, online gaming, as a segment, is touted to breach the $1.1 billion mark by 2021.
India – Biggest Sports manufacturing hub
India is considered as the hub for sports goods manufacturing and exporting. According to Indian Express, the sports business in the country is valued at ₹2000 crores, with Meerut and Jalandhar being the key contributors.
Almost 70 percent of all sporting goods are manufactured in Jalandhar, with different industries producing almost 318 sporting goods, including cricket bats, balls, athletic goods, inflatable balls, racquets, and fitness equipment. An estimated 500,000 people are employed nationally by the factories that conduct business worth over ₹5600 crores in global sales annually.
As per the reports, 60 percent of the sports goods manufactured are exported to countries such as the USA, UAE, UK, Australia, Germany, Netherlands, France, South Africa, Sweden, and Canada. Meerut and Jalandhar are also home to some of the biggest players in the sports industry, such as Vats, Stag and Sanspareils Greenlands (SG), BAS, Mahajan sports, Sareen Sports (SS), Delux sports (DSC).
Along with providing marketing opportunities, leagues in India are also giving young players a chance to display their talent at the global level. Corporates should think beyond CSR and start investing in sports. The government should also think about establishing sports as an Industry rather than considering it as an entertainment sector.
By Archil Katiyar