And that’s a magnificent headshot!!
He annihilated that poor warlord!!
These words encapsulate the vigour and enthusiasm that resides within competitive gaming on consoles or computers i.e. eSports. A few decades ago, nobody could ever think that virtual sports i.e. video games would become a multi-billion-dollar industry greater than Movies and Music industry combined. Nobody thought that killing virtual terrorists using mouse and keyboard would become an Olympic sport with viewership beyond 600 Million!
The esports industry generated a revenue of $1.1 Billion in 2019 and is growing at a fast pace. Viewership of eSports will exceed 700 million by 2021. But why is it such that most companies are still reluctant in sponsoring such events and rather spend billions on traditional sports.
A lot of companies like Take-Two Interactive are collaborating with sporting leagues like NBA to conduct online esports tournament. This approach presents tremendous revenue potential in merchandise sales along with the ability to sell team-branded eSports merchandise, as well as the ability to penetrate and develop new fan bases especially millennials given the fact that most eSports watchers are millennials and a third are females. A study revealed that gamers remain loyal to eSport sponsors if they do it right. But for the market to really mature, the various games and leagues within the eSports umbrella need more brand partnership opportunities.
Currently, brand sponsorships are largely made up of endemic brands such as gaming accessory manufacturers Razer, HyperX, Logitech and Turtle Beach, Processor manufacturer Intel. While other brands are slowly joining in – Coca-Cola, Buffalo Wild Wings, Bud Light, Red Bull, Monster, BMW, Nike, Puma, and Gillette have struck some deals in this space – eSports remains largely untapped and there are mostly the same sponsors every year.
The question is why is such a lucrative sponsorship avenue worth over a billion-dollar still not on the hotlist of Marketing managers.
Partly, this is because the industry is still at its rudimentary stage, meaning it’s hard to prove its value to those who are unaware of how eSports, its tournaments and in general video game industry works. While savvy marketers and brands will know of this space, key stakeholders and marketing heads will still prefer traditional sports over eSports because of the level of maturity traditional sports have. Most managers are lacking adequate experience of the industry and the networking to collaborate with such events (Which can be developed by attending eSports conferences). The fact that there exists no central organization to look over eSports tournaments and draft a reliable schedule of regular-season games makes it an immature industry from the POV of marketers.
Without being at the arenas or tournaments and getting a hands-on experience of eSports, it can be hard to grasp for stakeholders of big, traditional brands that the industry really exists and that people will genuinely spend their whole day at a venue watching other people play a video game just like they do for traditional sports. Only a gamer can understand the gaming industry and can harness the gargantuan potential that eSports has.
The ROI for brands investing in eSports is huge; the industry commands an eager base of millennials who are more than willing to spend multiple hours over watching eSports matches, which can be effectively utilized by brands for interaction and promotion. And, due to the fact the sport is still at its early stage makes it significantly inexpensive to sponsor makes it even more attractive.
However, one needs to tread carefully as the fan base of it is fickle and savvy to marketing than most people. Authenticity and relativity are the two most important aspects every marketer needs to take care of as the first impression is of the utmost importance in this area.
When it comes to India there is a whole different story. Indian eSports is still at a rudimentary stage and most of it owes to the fact gaming is still taken as a leisure or entertainment activity and not as a sport that requires skills and constant practice.
Along with this Indian eSports industry is plagued with numerous other issues. eSports organizers in India do not grasp gaming in its actual form and rely on a handful of articles and gamer reviews before organizing tournaments and as a result, most are not able to sustain themselves for a long period. Most organizers aren’t even gamers themselves in the first place and lack sufficient budget which translates into the unalluring prize pool and haphazard events. There still exists a big gap between what the audience in India wants and what the organizers deliver.
Nonetheless, India has come a long way and has emerged as one of the most lucrative markets in recent times for esports from a growth perspective. As of 2019, India stands at no. 17 globally in the soon to be a billion-dollar industry. With the growth in professional gaming in India, enhanced infrastructure like increase in the number of avenues for gamers to participate increased internet penetration along with increased internet services quality and the rising purchasing power of the consumer, gamers can now look at gaming as a professional career choice rather than just a hobby or a leisure activity. Indian eSports fan base and viewers, although low as compared to global stats, is slowly and steadily picking pace. Indian eSports industry looks luminescent and is shaping into one of the largest digital gaming markets.
eSports and video game industry, in general, has come a long way from its inception a few decades back. The billion-dollar industry is poised to grow exponentially and become the next big thing in the sports sponsorship industry. Marketers are steadily becoming aware of the nooks and crannies of video games and are now acknowledging the tremendous revenue potential of virtual competitions. Owing to the current situation of Covid-19, traditional sports will take time to recover while the eSports still grows at significant rates. Sooner or later eSports will witness the diverse sponsor backings that the traditional sports get. eSports will garner as much crowd as the traditional sports championships get. In a few years, eSports will no longer remain untapped racking in billions of sponsor money while we’ll sit back and enjoy Team Vitality take on Team Astralis with the same enthusiasm with which we enjoy Super Bowl.
Esports - Untapped Avenue For Corporate Sponsorships