What's behind Tata's move to become IPL title sponsor?

News that Tata Group is to replace VIVO as title sponsor for the Indian Premier League 2022 came out of the blue and now the industry is speculating as to the reasons for the change.

What’s happened?

Chinese smartphone manufacturer VIVO stepped in to replace PepsiCo as title sponsor in 2015 after the latter ended its contract two years early. In 2020, Vivo agreed with the Board of Control for Cricket in India to take a pass on that year’s event in view of the anti-China sentiment in the country before returning in 2021. 

Now VIVO too has chosen to exit early, reportedly because of low ROI and ongoing investigations into possible financial irregularities, although border issues with China may also become an issue again in upcoming state elections.

What in it for Tata?

Observers are divided on the benefit to Tata Group as the headline sponsor, with some arguing that, as a conglomerate, there is little for consumers to relate to. But individual units already sponsored events which were branded as Tata (e.g. the Tata Marathon rather than the Tata Consultancy Services Marathon).

Over the past couple of years, Tata Group has been acquiring more consumer-facing businesses and has restructured existing ones. Picking up the IPL sponsorship could be canny tactical move to help reframe Tata as a younger, more modern business while taking advantage of the tournament’s huge reach and engagement to drive affinity and relevancy. 

A Tata insider told Exchange4Media that the company is “getting very serious towards being a new-age company and a strong consumer-centric entity, willing to get out of its legacy framework not just internally but in its marketing communications too”.

Sourced from afaqs!, Exchange4Media