Adidas & Indian Cricket Team: A Win-Win Sponsorship Story

The fashion industry is incomplete without sports apparel! How? Let me explain. Can you play football by wearing a formal dress? Obviously not! You need a comfortable outfit that can absorb your sweat and doesn’t cause any hindrance in your sports/gaming activity. This led to an emergence of a new segment named the “Sports apparel industry.”  So, if you are a sports apparel company and want to expand your user base in India. What would you do apart from manufacturing the sportswear? Marketing! Yes, you would heavily invest in marketing your product through the craziest sports in the country. And in India, the most popular sport is none other than- Cricket! Similar is the story of Adidas & Indian Cricket Team sponsorship. This is a win-win situation for both parties.

The team will get premium merchandise for the matches. While Adidas will get a golden marketing opportunity to expand its user base as well as to monetize its products. Sounds quite well & a smooth process! But is this whole concept as easy in reality as it sounds? This is the crucial mysterious plot for folks. In this write-up, we will delve into the concept of Adidas & Indian Cricket Team Sponsorship. Also, we will determine whether the deal is sustainable or not.

Stay tuned!

Story So Far: BCCI-Adidas Partnership

The famous German Sportswear Brand Adidas signed a deal with BCCI as a kit sponsor for the next 5 years. It means that Adidas will sponsor Indian Cricket team till 2028. The BCCI-Adidas partnership has the following components-

• Sponsorship fee per match: Rs.75 lakh (per match)
• Royalty fee from the sale of merchandise & kit: Rs.10 crore per year

Adidas will be responsible for designing and manufacturing the jerseys, kits, and other merchandise for the Indian cricket team. It includes the men, women, and U-19 cricket teams of India. This is a five-period deal i.e. up to the year 2028. ESP Properties (WWP’s sports and entertainment agency) facilitated the BCCI-Adidas deal.

A Brief Overview of Kit Sponsors of the Indian Cricket Team

Do you know, multiple brands sought to manufacture & sponsor the kits and merchandise of the Indian Cricket team? Unfortunately, many of them couldn’t even continue their tenure. So, here is the list–

Now, let’s compare the sponsorship fee and royalty fees that the famous manufacturing companies had to pay to BCCI-

From the above two tables, we can see that Nike was a bigger player in the sponsorship field. But why did it discontinue the sponsorship after 2020? Didn’t it get the expected results or its interest fainted in the Indian cricket team? You will get to know it in the section of “Nike’s Fate.”

Intangible Bond between Adidas & Indian Cricket 

Undoubtedly, the BCCI-Adidas deal is one of the biggest deals in the world of cricket. However, Adidas’ entrance into the Indian cricket world is not for the first time! Really? Yes. Adidas set its foot in the Indian Cricket world back in 1995. How? We will tell you in this section only. Before that, you need to give a thought to an imaginary situation.  Imagine a scenario where you own a sports apparel company and want to educate the public about your brand. What would be the prime marketing strategies for you? Probably-

• Placing your logo on the jersey of a famous sports team
• An iconic athlete as your brand ambassador for advertisements

Well, Adidas is using its first marketing strategy in 2023 by signing a deal with BCCI (Board of Control for Cricket in India). But it has already used the second marketing strategy back in 1995. Now, let me tell you how! 

1995: Adidas Entered India

At that time Adidas preferred to associate with a player whose influence was much greater than the whole Indian team. I am talking about the famous player who dominated the Indian Cricket Team with his fabulous performance. Also, he had the craziest fan following. That player was “Sachin Tendulkar.” The three-stripe logo on his jersey was enough to influence Indian cricket fans. He even gave up his iconic MRF bat and picked up the Adidas bat. Thus, Adidas continued to use this strategy in which they dealt with individual cricketers.

Seeing the success of this marketing strategy, Adidas is all set to take the next logical step of marketing. That is to go after the entire Indian Cricket team.

But why is Adidas crazily going for the Indian cricket team? Does it have a leap of faith in the Indian Cricket team? Read the next section and you will find it out!

Adidas: Expectations vs. Reality

In the introductory part, you read about the reasons why sports apparel companies fell in love with our cricket team. So what is the motto of Adidas? To utilize and exploit India’s fanatic love for cricket.

How much money will Adidas make through this deal with BCCI? You may ask. We all are curious to know that. Unfortunately, the analysts are yet to figure that out. Once we get any hint, we will update you soon!  

1. Expectations: Indian Audience’s Love for Cricket will immensely contribute to Sales

To support the team, they buy jerseys containing the name of their team. Also, on seeing their favorite players advertising the product, they shell out their money to buy their favorite merchandise.

A similar scenario happened in the past. Back in 2018, when Adidas sponsored the kit for Cristiano Ronaldo, the sales of jerseys boosted. In 24 hours, fans bought over 5 lakh jerseys with Ronaldo’s name. As a result, the sales hiked to 60 million euros. So, is it beneficial for Adidas to sponsor Indian Cricket team? Yes, it is. But not guaranteed.

Well, that was Europe. But this is India. Do Indians crazily shell out their money just for sports? The answer is “No.” Indian audiences are much smarter than others!

2. Reality: What do the majority of Indian Cricket Fans prefer?

Nike also expected a similar scenario stated above. But its expectations didn’t match the reality. Because the majority of fanatic folks in India don’t prefer to shell out a huge chunk of money for the one-day occasion. Sounds complicated? Don’t worry. You will get a detailed explanation in the next section.

Will Adidas have the same fate as Nike? 

As you have seen in the comparison tables mentioned in the section “A Brief Overview of Kit Sponsors of the Indian Cricket Team.” Nike was the biggest player in Indian Cricket Sponsorship. Not only had it sponsored the Indian cricket team for 14 years. But also gave the highest fee in terms of Indian cricket team sponsors as well as royalties. It poured nearly Rs.200 crores to place its logo on the Indian jersey. 

Also, it renewed the contract in 2011 and 2016 for Rs.270 crores and Rs.370 crores respectively. Hence, Nike’s bid was 60% higher than that of Adidas. Nike saw certain golden results too while being connected to the Indian cricket team. India won the inaugural T20 World Cup and ODI World Cup in 2011. 

Despite this golden era, Nike had an unfortunate fate. What was that? For being a long-time partner, Nike would have got the next sponsorship for just Rs.65 lakh per month. But it didn’t renew the contract in 2020.

Why?

Reasons for the Fall of Nike’s Expectations 

See, when India was winning numerous significant matches like T-20 and ODI world cups, everybody anticipated a hike in sales. This means the winning of India could have hiked the rate of Nike’s merchandise sales in India! Unfortunately, the reality was harsher and contrary to Nike’s expectations.

The sales didn’t hike at all. Reason? Whopping prices of Nike’s merchandise.  Do you know the price of Nike’s Indian jersey in those days? Rs.5000 only. Imagine a single jersey that you can wear hardly once or twice a year costing Rs.5000! Hardly 10% of Indians can afford it. This was not a worthy deal for Indians even if they could afford it. 

So what did the Indian audience do? You may ask. See, wearing a jersey to support the team is a one-time scenario. The roadside hawkers sell the Jerseys at astonishingly cheap prices that everybody can afford. So the folks in the stadium simply purchased the jersey from hawkers. Because the name India written on the jersey is what matters, not the authenticity or the brand’s name.

Indians buy jerseys to represent their love for the Indian cricket team, not the brand. This was a huge setback factor for Nike. Is it going to be a loss for Adidas to sponsor Indian Cricket team? You will find out in the next section i.e. the final part.

Final Words: Is the Adidas & Indian Cricket Team Sponsorship Sustainable?

Now the question arises- is the Adidas & Indian Cricket team sponsorship sustainable? Will Adidas also see the same fate as Nike? Well, there is no clear answer to this. Indeed, Nike’s expectations weren’t matched. But companies are eager to showcase their logo in the jerseys and kit of sports teams. Why? Because there is a significant probability of successful sales and profits.

So you might have got the answer to the question- How is it beneficial for Adidas to sponsor Indian Cricket team?Also, Adidas observed an increase in sales by sponsoring major sports teams around the world. Back in 1995 too, Adidas observed a considerable increase in the sales of sports apparel by sponsoring the kit of individual cricketers. Thus, there is a high chance that Adidas & Indian Cricket team sponsorship will be sustainable!