Are Esports Eclipsing Sports? The Latest Trends

Electronic sports or esports are a much bigger business than anyone outside the circle of serious gamers might think. The chat about e-sports already having overtaken physical sports is however not (yet) true.

Esports are gaming competitions that take place in huge sports stadiums with large physical and online audiences, much like regular sports events. It may seem incomprehensible that anyone wants to sit and watch people play and compete in videogames, but esports are on the rise and the category is raking in a ton of viewers, about 495 million globally in 2020. At least half of this number identify as esports enthusiasts tuning in daily to various platforms to watch ‘cyber athletes’ compete in gaming competitions. Young people are watching video games in fast increasing numbers. In 2020, the majority of esports fans/ viewers were between the age of 18-24; Gen Z, it appears, are really into this.

Platforms like Twitch, Facebook Gaming and YouTube Gaming combine the biggest number of young esports viewers, with Discord and Caffeine being the promising newcomers. Each platform – much like tv channels – tries to secure exclusive broadcasting rights to big esports events as the increasing number of viewers, like with any medium, bring in more and more advertisement revenues. Esports revenue streams are expected to be more than $1.8 billion in 2022 according to Newzoo. (Note that esports’ and gaming revenues are not the same thing, as global gaming revenue in 2021 stands at $175.8 billion).

Esports established itself as a viable sports category as- in 2020 alone - a total of $623.9 million of sponsorship investments flowed into this segment. Big ‘live’ tournaments are the most popular as they bring in high and concentrated viewer numbers.

The biggest tournaments, like the International, the Fortnite World Cup Finals and League of Legends attract large audiences and have eye-watering prize money, running in the tens of millions of dollars. The International has the biggest amount of prize money at just over $40 million with 18 participating teams, each of which consists of 5 players. Which is, of course, much smaller (per player) than the $440 million of prize money earmarked for the 2022 UEFA Wold Cup in Quatar, with 24 participating teams. But on an individual level esports tournament winners can make prize money that is similar to prize money available at big regular sports events such as the US Open or Wimbledon.

So where will it go from here? For businesses looking at wise ways to spend advertising dollars, the esports category is increasingly difficult to overlook. Esports offer the opportunity to actively interact with viewers – via online ‘live’ chat during the events - and to get feedback from a target audience.

Esports, like other platforms, have created their own influencers. Famous gamers or gaming groups have celebrity status within their communities and are hence able to reach large audiences and create much desired traction for brands. Adidas, for example, launched a signature sneaker with Ninja and FaZe Clan worked with Burger King to promote its meat free Impossible burger.

The make-up brand Charlotte Tilbury partnered with esports festival Girl Gamer on a series of sponsored digital activations, masterclasses and gaming events. Although slightly fewer in number, there is a good list of famous female gamers and many beauty-brands are entering the space.

The esports world may well expand beyond today’s imagination. After all, esports and gaming are just the entry point for what we may do in the metaverse. ‘There’ we could watch not only gamers play video games, but we could watch an entirely virtual version of the US Open, with all players’ avatars in action. Esports are the intermediate step from an invented video-game character, manipulated from the outside by a human, to the metaverse, where we are present inside the video game with our ‘twin’ avatars.

Brands and businesses may increasingly have to divert their attention and money from the physical world to the virtual one, as this generation will, likely, spend an equal number of hours in the virtual world as they do in the physical world. Esports could very well be that window to the future.

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