Two years ago we spoke to the inaugural F1 Esports Champion, Brendon Leigh, about what we described then as a breakthrough year for esports. Since that time the sports sector, and many others, have become increasingly interested in the opportunities surrounding the industry.
The following year it was estimated that esports delivered $1 billion in revenue globally, reached an estimated audience of 380 million people and had prize money exceeding many high-profile global sporting events.
The similarities between conventional sports and esports are extensive: both have competitive tournaments with prize money, individual and team participation and take part in front of a live audience. And with global companies becoming more involved from, amongst others, the worlds of technology (Microsoft, SAP, Intel) and automotive (Nissan, Honda, Mercedes), it is increasingly hard to ignore.
Just like with conventional sports; merchandise, tickets and advertising make up a proportion of the total revenue in esports. In 2019 however, sponsorship and media rights combined make up the lion’s share at an estimated 65% of total revenue. In fact, esports sponsorship is expected to have risen by 170% between 2016 to 2019 to over $450 million. Some reports are estimating this will more than double to $1 billion by 2022. (Newzoo 2018)
With this in mind, we have outlined five areas you should take into consideration when thinking about an esports sponsorship.
- Esports is highly accessible to anyone, anywhere in the world
- It engages young, hard-to-reach audiences
- Sponsorship entry costs are still low, for now
- It’s a gateway to Asia
- Offers experiential brand experiences
It is also important to understand the esports ecosystem, and those involved in it, as it is diverse and ever changing.
Image credit: London & Partners
Games developers and publishers including Riot, EA Sports and Valve – they control the games and have varying degrees of involvement in esports tournaments. League of Legends producer Riot Games for example organise their own esports tournaments whilst Counter Strike: Global Offensive’s Valve do not and allow 3rd parties such as ESL to run them.
These are used to stream tournaments with the Amazon owned Twitch, Microsoft’s Mixer and YouTube being the most commonly used.
Teams & Players
Teams often mix up their roster dependent on what title they are playing, whether it be Fortnite, FIFA, CS:GO or League of Legends. Some of the most famous include London-based Fnatic, Cloud9 and Ninjas in Pyjamas.
Esports specific arenas are opening all the time with Gfinity the most prominent example in the UK. Event organisers such as ESL run some of the largest tournaments in the world and recently launched the ESL Pro League for CS:GO which brings structure to around 20 pre-existing tournaments.