As more people—especially youth and young adults— shift their habits away from traditional media, it's becoming harder for brands to reach these fragmented audiences. By their very nature, Esports thrive in the online environment. They also present many of the same sponsorship opportunities that traditional sports do. But many brands have taken a "wait and see" approach to this new market.
The wait is over, and what do we see? Those brands are missing out! Esports are a billion-dollar industry that has already surpassed the revenue and viewership of several traditional sports. The events freely transcend geographic boundaries, making them especially attractive for global brands. Early adopters are reaping the rewards, but there are still plenty of opportunities. Consider these reasons that an Esports sponsorship might be what your brand needs to thrive:
1. A Growing Market
2020 is the year of Esports. The market is projected to reach US$1.1 billion in revenue this year, up 13.6% from 2019. The audience size has grown to around 495 million viewers so far. Although the global pandemic has surely prompted more people to give Esports a chance, the momentum is expected to keep up—projections suggest there could be 646 million viewers in 2023. That's a whopping 31% increase to look forward to.
The most-viewed single Esports event so far was the 2018 League of Legends Mid-Season Invitational in Adlershof and Paris. This event attracted 60 million online viewers. For comparison, the NFL's Super Bowl drew 103.4 million viewers that same year.
Despite debate around whether Esports are "real" sports, even the International Olympic Committee is paying attention. They endorsed the Intel Extreme Masters tournament during the leadup to the PyeongChang 2018 Winter Games. Prior to the COVID-forced postponement, the IOC had also planned to endorse the Intel World Open Esports tournament ahead of the Tokyo 2020 Summer Games.
2. A Flexible Industry
The Esports industry is still young. Brands and agencies have a golden opportunity to ensure that true relationship-based and outcome-focused sponsorships can be built. There are many smart professionals in the Esports industry who have deep experience with sponsorships, but they can often provide more flexibility than their cohorts in traditional sports can. Rights holders are thirsty for strong and sustainable corporate engagement—many are willing to tailor a custom solution to each client's needs instead of sticking to a package-based approach.
3. Naturally Digital-First
Sports have traditionally been focused on the in-person experience and television audience. Digital assets are often treated as add-ons. But with Esports, digital assets are foremost in the rights holders' minds.
Remember the Esports event we mentioned earlier that attracted over 60 million viewers? Fewer than 7,000 of them attended in person.
Sponsorships built to focus on digital activations can be highly creative. Campaigns can very easily be adjusted, enhanced, or stopped to effectively utilize resources based on results.
For many brands, an important objective is to connect with fans and build a marketing database for follow-up. This is more easily done in the digital world—many fans willingly provide personal contact information to access content or enter contests.
4. An Entryway To China
Expansion and engagement in China are attractive strategies for Western brands. That's not only because of China's enormous population—trends indicate that Chinese consumers love Western brands. In addition, China led all other regions in Esports revenues in 2019. Any savvy brand manager can see the opportunity here!
5. Millennials Are Watching
Millennials make up nearly 23.5% of the population, but they're one of the most difficult demographics for advertisers to reach. They don't consume TV, radio, newspapers, and magazines to the same extent prior generations did. Instead, everything they could possibly need is just a few taps, swipes, or clicks away.
To reach this audience, many brands are foregoing traditional advertising in favor of online platforms and in-person events. Esports sponsorships are once again an attractive opportunity: 62% of US Esports viewers are in the coveted age 18-34 demographic. And to make it even sweeter, a 58% majority of professional gaming fans have a positive attitude toward brand involvement in Esports.
6. Rising Brand Recall
It might feel like Esports audiences would only care about endemic brands—those whose products or services are closely connected to gaming or technology. But many Esports fans understand the need for sponsorships and appreciate the brands that help Esports grow, endemic or not. Brand recall has been slowly increasing year-on-year: recall for endemic brands is up to 53% while recall for nonendemic brands has now reached 43%.
Opportunities clearly abound in the Esports arena—will you take advantage?
You might also be interested in:
- Blog: Esports Athletes: The Next College Superstars
- Podcast: Inside Burger King's Sponsorship of Stevenage FC - Alex Tunbridge - Chief Executive
- Podcast: Inside AirAsia and Esports Sponsorship With Ben Rynjah
Daniel has over 25 years experience in helping brands align their marketing efforts to truly deliver on brand objectives. He has experience in a wide-range of industries and has worked with organizations from small businesses, startups, and international member organizations to help them achieve their goals.