Editor's Note: This is part of a series of pieces looking at the year to come that Marketing Dive will publish throughout January. For more on what to expect in the months ahead, check out 7 trends that show 2020 will be a make-or-break year for marketers and Can revenue-hungry retailers rise to meet digital advertising's opportunity?
With more than 100 million unique online viewers tuning into the 2019 League of Legends World Championship Finals in South Korea, esports managed to surpass the audience of 98 million who watched last year's Super Bowl. In 2020, however, marketing and gaming industry experts say the opportunity to capture consumer attention will put esports into a league of its own.
The international reach of esports has already grown to more than 443 million people, with projected revenues of $1.1 billion, according to research from Green Man Gaming. That's higher than more traditional sports such as the NFL, MLB and NBA, the report said. The number of esports athletes who could be courted for sponsorship or influencer marketing partnerships, meanwhile, has more than tripled from 8,000 to 25,000 over the past five years.
"Last year I was hearing, 'Let's test and learn in esports and figure it out.' Now it's, 'We need an esports strategy, but I don't know what it is,'" said Brad Sive, chief revenue officer for Team SoloMid (TSM) and Blitz, an esports organization based in Los Angeles.
While experts had previously told Marketing Dive the window for non-endemic brands to participate in esports was closing, the segment's massive growth may change that as a new decade begins. Just look at Snickers, which became the presenting sponsor of the Madden NFL 20 Club Championship recently, or Puma, which created an esports apparel line with Cloud9.
In another sign of the still-untapped potential here, the annual Consumer Electronics Show (CES) — which kicks off this week in Las Vegas — added a Gaming and eSports track to its agenda this year, including a dedicated session for brands.
Wellness, automotive and financial services opportunities
The interest in esports is drawing the attention of marketers across a number of categories not typically associated with the space.
"I think what I'm seeing in 2020 from an esports proposition is not just an investment in marketing from typical categories like sugar beverages, but brands in the health and wellness space," said Andre Filip, CEO of ELA, a creative agency that has worked with the likes of EA Games. "The gamers are looking at types of products they're putting into their bodies, they're doing more meditation. Brands have to start looking at them as real athletes, and not just a bunch of guys sitting behind a game console eating nachos."
Filip said a good indication of the changing tide in esports is the presence of brands like MAC Cosmetics at events such as TwitchCon — the annual conference for Twitch livestreamers and their fans — reflecting the broad appeal of gaming.
"This is a young audience, but they'll be the ones with the checking accounts, with higher incomes."
Brad Sive
chief revenue officer for Team SoloMid and Blitz
Other categories, like automotive, have dabbled in esports but may need to refine their strategy, Sive suggested. While car companies might have been running esports-related marketing activities to support a specific car launch, for instance, the executive said they should instead focus on simply making esports gamers and viewers feel good about their brands by aligning with the community.
Financial services firms may also decide to take a closer look at esports, per Sive.
"They're not engaged, and I don't know why," he said. "This is a young audience, but they'll be the ones with the checking accounts, with higher incomes."
Some brands aren't simply trying to show up in the esports community, but are helping to facilitate it to bring more value to their target customers. Technology firm called Swarmio, for instance, is specifically targeting telecommunication companies with cloud computing services that will let them create esports in local geographies through a portal. This is already happening in markets like Sri Lanka, where one of Swarmio's customers has established SLT eSports.
"A telco used to be the king in terms of services, but they lost voice to services like Zoom and Skype, and then they lost movies to Netflix," Swarmio CEO Vijai Karthigesu said. "What they're doing today is basically providing a dumb pipe."
Creating their own esports platforms, however, will not only let telcos potentially create more loyal customer relationships but open up marketing partnerships with other brands, Karthigesu said.
While many of the telcos Swarmio is targeting are based outside of North America in places like Asia, the company has also created an application for esports teams and leagues that let viewers earn points that can be turned into rewards. Those who spend a certain number of minutes watching a game, for instance, could earn enough points to get a personal greeting from their favorite player on their birthday, or receive merchandise offered through a brand partner.
Enter the esports influencers
Influencer marketing and sponsorship of esports athletes may also become more turnkey for brands in 2020, as firms like Luminosity Gaming attempt to provide more of the management services associated with traditional pro athletes and teams. Luminosity has already signed more than 50 professional esports players and gaming influencers, including those focused on hit games such as "Fortnite."
"The lifetime value of an esports customer is going to be huge."
Vijai Karthigesu
Swarmio, CEO
Most of the marketing dollars going into esports this year will be divided across media buying, experiential marketing and content integrations, according to Menashe Kestenbaum, CEO of Luminosity's holding company Enthusiast Gaming. While the latter may be the most effective, particularly when working with influencers, he said it can require more legwork than brands are comfortable doing.
"If you're looking at the Super Bowl and you pay whatever for that sponsorship, it doesn't have to be tied to football whatsoever. You're going to get that exposure," he said. "In the gaming world, there are a lot more caveats to that. There's more of a need for authenticity and finding a way to integrate with the content."
This is why ELA's Filip suggests brands think about creating a council of gamers who can provide expertise — almost like a focus group.
"Just because you think something’s cool doesn't mean the audience will. And one gamer on your marketing team doesn't count," he said.
The return on investment (ROI) for getting esports marketing right could well be worth it, Sive added.
"It's not like buying an Instagram post with a beauty blogger," he said. "With a gamer, you're going to get an in-game integration that could last for two hours, where they're talking off and on about your product the whole time. They're not just on Instagram or YouTube, they're also on TikTok. The scale — and what you're getting in terms of a specific audience — is different."
Karthigesu agreed, adding that brands should also recognize that the esports lifestyle doesn't have a defined end date, a fact more marketers could wake up to in the months ahead.
"Gamers are gamers for life," he said. "That means if you get them, you get them for life, and gamers follow other gamers, which helps in terms of growth as well. The lifetime value of an esports customer is going to be huge."
