When many people think of the sport, they don’t immediately picture video games or eSports.
To understand eSports, perhaps it will help to use a comparison to another sport. Let’s look at the world game of football, or soccer depending where you may be in the world.
Sorry to the football purists out there, but the beautiful game can be broken down in its simplest form as follows: A group of people kicking a ball around for a defined space, for a defined period of time, where the winner is the group of people who can kick the ball between the goal posts more than the other group of people.
I would liken the above explanation of football to the stereotypical view that many in the sports industry hold towards gaming and eSports; It’s just a bit of fun for kids in their bedrooms to keep them off the streets.
Whilst anyone in the industry can appreciate that football is far more complex in its tactics, levels of competition, entertainment value and ultimately commercial value, have you taken the time to look deeper into eSports?
Let me break it down for you to give you some insight into the landscape of eSports and the commercial implications of the world’s fastest growing sport whether you are a sponsor or rights holder looking into this space.
Gaming, or video gaming has been around nearly as long as the computer itself.
If you have ever played Super Mario Kart on your Nintendo, Street Fighter in an arcade, or even Angry Birds on your phone, then you have dabbled in gaming.
Similar to many other sports, eSports is the competitive evolution of gaming where the best seek to compete against the best to be crowned champions of their respective games.
Within gaming, the competitive fields of eSport are then broken down into ‘Titles’ which are the actual games themselves. These Titles can be as varied as football and golf requiring vastly different tactics, skills sets and temperaments from their players.
Once we are in the titles we can then break down into ‘Leagues’. If we take the title of League of Legends as an example, the world’s most played game, where the creators Riot Games govern the competitive League structure of international competition down to domestic competition. This structure can be compared to say soccer/football which has a World Cup, UEFA Champions League, English Premier League and then lower leagues of competition.
As competitive gaming emerges in pop culture we are witnessing the meteoric rise of eSports. According to an article in Business Insider estimate, total eSports viewership is predicted to experience 9% growth, compounded annually, between 2019 and 2023, which is an increase from 454 million in 2019, to 646 million in 2023.
These numbers indicate that the global eSports audience is set to double in the six year period between 2017 (335 million viewers) and 2023 (an estimated 646 million viewers).
Some games make the transition to eSports quite easily as they are based on traditional sports. This means that the tactics and existing fan base provides a platform to take the traditional sport online seamlessly.
Australian sports such as the A League have already jumped onto this through the popular FIFA game being a digital extension of the same sport.
If you would like some more background, here is a video that gives a brief history of the evolution of eSports:
The eSports audience is a young, typically male, digital savvy consumer. They typically block ads online and are some of the most elusive consumers to reach through traditional media.
If we look at the League of Legends title alone as the world’s most popular game, the total numbers of active players would make them the fifth largest country in the world. This equates to 160 billion hours spent playing just this one online video game. You can jump on Netflix and watch League of Legends: Origins for some more background on this title specifically.
The eSports audience spend much of their time online streaming, with the dominant channel of choice for live streaming being Twitch (www.twitch.tv). Twitch is a unique broadcasting medium, where fans can interact and comment on the broadcast directly whilst watching a live stream. This instant feedback might at first glance seem like a marketer’s dream, however must be pursued with caution with a largely skeptical audience.
When Nielson looked at the eSports viewer habits on Twitch through their eSports Playbook For Brands 2019 they found some compelling data. 61% do not watch TV on a weekly basis, 70% spend more time engaging with eSports than traditional sports and 90% can name at least one non-gaming-related sponsor in eSports.
eSports is certainly new territory for many brands. Access to a direct channel into a hard to reach audience that is extremely passionate about their gaming provided opportunities simply not available through other marketing channels.
According to esportsearning.com, at the time of writing this blog the world’s highest paid gamer, Johan Sundstein of Denmark, has pocketed nearly US$7 million dollars in his career. If we look more locally, an Australian gamer by the name of Anathan Pham has amassed over US$6 million dollars in earnings.
The above figures are taken from tournament prize money and other documented sources. Meaning that arguably further endorsements or other commercial opportunities may not be recorded in these figures.
Locally in Australia there are a number of professional eSports teams that compete in various tournaments. The OPL or Oceanic Pro League, has eight teams competing exclusively in League Of Legends.
Individuals and teams of gamers continue to develop an audience on Twitch as well as followers across other channels and platforms. With any audience comes commercial value to brands, making the eSports industry one that is set to continue its trajectory of growth witnessed in recent years.
On a global scale, Business Insider reports that the eSports ecosystem will surpass US$1 billion in revenue in 2020.
The same article also predicts that revenues will reach as high as US$1.8 billion by 2023. These figures are made up of media rights, merchandise, event ticket sales, in-game purchases with the lion’s share (69%) coming from advertising and sponsorship.
85% of eSports viewership and revenue comes from three key regions of North America, Asia-Pacific (APAC) is Europe. APAC itself made up 57% of viewership alone in 2019.
Twitch, the gamers platform of choice for live streamed eSports is also a popular platform for content creators in the gaming space.
The Nielson eSports Playbook For Brands 2019 reports that 63% of Twitch eSports fans in the U.S. said that in an average week, they spend more time interacting with gaming personalities versus eSports content.
One individual Twitch content creator alone racked up 209 Million hours watched from March 2018 and February 2019. (SuperData Arena, March 2018 – February 2019)
Despite the impressive numbers growth projected, eSports is still in its infancy. As a rights holder, eSports offers great flexibility and agility for brands to activate offering access to leagues, teams, individuals and content creators.
As the OPL grows and more teams enter the market across titles, the professionalism and additional resources will bring with it a framework for high performance.
A SkyNews Australia segment on eSports in Australia provided some great conversation around the growth and trajectory of the Australian eSports scene:
Whilst this structure is continuing to evolve, teams will look for any edge they can to enhance their performance. This will range from athlete nutrition, fitness and mental wellbeing to infrastructure which is starting to become not only a focus of teams but a priority that warrants resources being put towards this end.
eSports in Australia is in its infancy and presents many opportunities for brands to reach a very active, loyal and hard to reach audience. If you would like to learn more about whether an eSport Audience is the right fit for your brand, download the Australian eSports Audience Breakdown.