TAPPING THE POWER OF ESPORTS IS A TOP PRIORITY FOR PUBLISHERS, BRANDS, MEDIA AND TRADITIONAL SPORTS
PERCENTAGE OF FANS THAT STARTED FOLLOWING ESPORTS WITHIN THE LAST YEAR
Source: Nielsen, The Esports Playbook (2017), and The Esports Playbook: Asia (2017); survey samples = 1,000 esports fans aged 13-40 per market
Efforts to commercialize esports and harness its audience engagement power are intensifying, and the sector is primed for further strong growth.
Games publishers are playing a more active role in building businesses around the esports scenes related to their titles. Activision Blizzard’s Overwatch League is perhaps the most prominent example of the changing approach. Blizzard has adopted familiar elements from traditional sports to create the global league: franchise teams, multiple league-wide partner brands, an exclusive media rights deal. It’s a bellwether project: many eyes are on it to see if Blizzard can build the large, global audience it is aiming for.
There has been much PR in recent years around activity such as sports teams signing up esports players, but in reality the relationship between traditional sports and esports is only just beginning. Many sports are still working out how to connect with the sector. Even the most natural fits, such as those with existing successful game series, are only now putting serious structures in place to leverage competitive gaming.
Formula 1 team McLaren hired a new simulator driver via its innovative World’s Fastest Gamer initiative last year. Formula 1 had over 60,000 gamers enter its inaugural Esports Series in 2017.
Formula E and NASCAR are also developing their esports competitions. Looking to sponsorship, “non-endemic” sponsors are investing increasing amounts in esports. A Nielsen study of 15 major events in 2017 showed non-endemics accounting for 39 percent of the sponsors, although only 30 percent of the total QI Media Value (Nielsen’s measure of the quality of media exposure for brands). Another evolution seen in esports sponsorship is the increasing use of entertaining and innovative content in brand activations, in which athletes and teams are enthusiastically participating.
In esports media, competition is heating up for market-leading platform Twitch. The Amazon-owned giant faces a challenge from, among others, YouTube, Facebook and Twitter. Exclusive deals are being hammered out with leading competition organizers as the platforms vie to become the “home” for lucrative sections of the streaming space. Twitch grabbed exclusive Overwatch League rights for 2018 and 2019 in the biggest deal last year, and more recently got exclusive rights for the inaugural 2018 season of the NBA 2K League. Facebook’s move into esports streaming is part of a broader strategic move into video.
Esports looks set to remain one of the most dynamic sectors of the global media and entertainment industry in the near future. It’s still a fairly nascent market, its audience is growing quickly and there is a strong expectation of growth in revenue and other metrics.
Taking a cue from traditional sports, esports will adopt similar revenue-generating models.
Smart traditional sports will adopt esports innovations, particularly in fan engagement, live streaming and the event experience.
Creative content will be key for successful esports sponsorships.
The value of esports streaming rights will increase as Twitch and its rivals seek exclusive content
