eSports, a billion-dollar industry Part 3: Global sponsorship and the way forward

Riot Games

Of the USD1.5 billion worldwide eSports market, investors account for 50 per cent and sponsors/advertisers are close behind at 35 per cent. The remaining portion is comprised of prize pools (6 per cent), merchandise and ticket sales (5 per cent), and betting and amateur tournaments (5 per cent). 

Intel, T-mobile, Coca-Cola, Airbus, Mercedes-Benz and Nike are some of the biggest sponsors at the moment. The link is obvious for internet-computer moguls Intel and T-Mobile, but what’s in it for Airbus and Mercedes-Benz? 

Coca-Cola Company

eSports puts brands in front of an audience that is becoming notoriously difficult to reach. The viewers of eSports’ content are less likely to consume traditional media. They grew up watching YouTube and getting content on demand. For them, heading to popular video game streaming site Twitch to watch a match is traditional. Primarily comprised of millennials, they are also very savvy at avoiding old-school advertising. 

They appreciate brands that thoughtfully integrate sponsorships with the activities they enjoy — in this case, eSports. Meaning, you can’t just slap a logo on something and hope that it will be enough. They want to see brands that are actively helping to improve or benefit the scene. You need to invest intelligently. With their contribution, big brands like Mercedes-Benz and Airbus are making early investments in this popular generation. 

Brands that go beyond traditional sponsorship also find opportunity in the form of strategic partnerships. Footlocker announced that it will bring Champion’s eSports line to both its online and in-store shelves. Walmart.com partnered with merchandiser Fanatics to sell Overwatch League jerseys and gear. Shoe brand K-Swiss will create a casual and performance shoe in partnership with the professional US eSports team the Immortals.

How do traditional sports take eSports into account?

This growing industry has been so prevalent that even traditional sports are getting involved in different ways. 

First in the creation of eSport leagues for their respective sports in partnership with the gaming brands. The NBA set the trend with the creation of the NBA 2K League in collaboration with the developer of the game Take Two. The format mirrors the NBA and the e-teams are owned by the ‘real’ teams. This allows eSport to piggyback off of the already established recognition of the NBA, while the League can tap into an audience that was previously inaccessible, bringing a community together and adding an additional revenue stream to their assets. 

NBA

In Europe, Ajax and PSV Eindhoven, two of the most decorated football teams in the Netherlands, have both entered professional gaming by signing an individual professional FIFA player and a full squad of FIFA eSports pros, respectively. Wolfsburg, Sporting Lisbon, FC Schalke and Manchester City have also gotten involved in FIFA eSports to some extent. Even West Ham signed pro-FIFA player Sean ‘Dragonn’ Allan, becoming the first UK football club in the country to embrace eSports.

The way forward

eSports are getting bigger and are drawing more and more attention. Few points need addressing in order for the ecosystem to progress more stably: 

• Settling the ongoing and often heated debate of whether to consider eSport as a traditional sport
• The Oxford English Dictionary’s definition of the word “sport” is defined as “an activity involving physical exertion and skill in which an individual or team competes against another or others for entertainment”. It is difficult to say if the debate will be settled one day, but the International Olympic Committee is considering eSports. Its president, Thomas Bach, said “there is an agreement that we can’t, and we should not, ignore the growth of the egames industry and the interactivity of it for the young generation. That we should engage with this community”.

• Dealing with politics:
• Politicians tend to link mass shootings and gun violence directly to video games, even if there is more than enough research debunking the theory. This kind of misleading information damages the reputation of the industry. This simple chart speaks for itself, showing the top video-game-consuming countries and the number of violent gun deaths in each of them. 

Vox

• Establishing a “career path” like in traditional sports:
• One thing traditional sports have that eSports don’t is a path athlete’s follow to progress. A basketball player in the US goes from high school sports to college ball and then to the NBA draft. In European soccer, the path is also pretty simple, going from junior league to a potential selection into the first teams. Today there is no such thing for eSports. However, since age is irrelevant in eSports, some think a progressive path wouldn’t make sense.

• Educating the public: 
• This is exactly what we are doing with this article. Most of you have heard of eSports but are not really aware of what’s happening in this billion-dollar industry. There is a real need to explain how eSpots work – the mechanics behind the whole machine. 

Could the eSport industry get bigger than the traditional one? Only time will tell, but for now the gap is abyssal – USD 1 billion versus USD 488.5 billion… Now is still a good time to get into the world of eSports! 

A The Consultancy Group article, written by Alessandro Di Benedetto

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