Riding the e-sports wave: Professional players, sponsorship and big rewards

09:43 | 17/10/2017
Companies and gamers alike should aim for matching values when seeking successful sponsorship opportunities, say industry experts
A female gamer streaming her Counterstrike: GO gameplay on a live streaming platform. (Photo source: Team Asterisk's Facebook page)

SINGAPORE: While e-sports might be perceived in some circles as a niche activity, streaming viewership numbers and financial reports that can be found online suggest it is getting close to moving into the mainstream.

When it comes to eyeballs, data analytics website Teo Professional showed that streaming viewership for multi-player game League of Legends clocked close to 4.2 million hours on Twitch.tv for Sunday (Oct 15) alone.

Second on the website’s daily list of viewership was the game Playerunknown’s Battlegrounds with about 2.1 million hours watched online, while third was DOTA 2 with about 1.8 million hours clocked globally.

A study by analytics company Nielsen done in the US and Europe showed that 71 per cent of e-sports fans believe that gaming will become mainstream, while 53 per cent consider e-sports to be an actual sport.

Meanwhile, market estimations on the gaming intelligence website newzoo.com indicate that e-sports revenues are expected to reach US$696 million globally by end-2017.

Newzoo CEO Peter Warman claimed that e-sports is not simply growing exponentially as a new independent business and industry.

“With the arrival of livestreams and events, gaming has entered the realm of broadcasters and media that can now apply their advertising business model to a market previously out of reach for them,” he said, on the company’s website.

This dynamic was among the issues discussed at the inaugural SEA Summit in Singapore last Friday (Oct 13), which was a business-to-business conference for Southeast Asian game industry players.

While acknowledging the “gold rush”, industry experts at the event said that things may not be what it seem and that more understanding is needed between sponsors and the gaming industry.

BUILDING RELATIONSHIPS

Having worked with a number of companies involved in e-sports, industry consultant Mark Julio said good sponsorships often involve long-term commitment. “(In e-sports) the returns might not be immediate or something that you’d see in a couple of years.

“During one of our investments, it was only two to three years later that we began to see more and more people associate our brand with our target audience through our sponsorship,” said Mr Julio, whose portfolio includes advising Razer Inc and the EVO Championship series.

“There’s definitely going to be more pitfalls along the way as e-sports is such a young market.”

He added: “It really depends on how much you put into it and how much you nurture it alongside the community. It’s not working out for everybody as I’ve (seen) some terrible investments. It also boils down to you doing your homework and your brand making sense to that community.”

Mr Julio cited Red Bull as a company which has done the right things when sponsoring e-sports. “They’re obviously one of the… most recognisable brands and they don’t have to invest in gaming.

“But for a non-endemic brand, to be part of it and actually ingrain themselves with the culture and grow alongside these players – I think it’s an amazing thing,” he said.

“They’re really capturing the audience… (they are) not just telling a story about the players and the individuals that they sponsor, but also the community. And I think the team over at Red Bull has done a great job to highlight that.

“In turn it has helped the community grow.”

The strategy of getting to know the community, mirrors Red Bull’s involvement in their other sponsorship investments, according to Anna Sakagawa, who is involved in the company’s Japanese marketing operations. “We treat the e-sports audience just as importantly as the action sports audience.

“Sponsorship in e-sports isn’t about putting your logo there, but it’s more about the smaller business opportunities. As a brand, we also have to know the players and the culture, and see what the added value is that we can bring to the community.”

THE POTENTIAL IS THERE

Noting the untapped potential in e-sports, gaming chair company Secretlabs is among the local enterprises that looks out for gaming talents to sponsor.

“When we evaluated the market, we saw that there was a very heavy focus on e-sports specifically. We felt that there were still gaps, so we started to target YouTubers, streamers, and gaming channels which wasn’t done back then,” said Alaric Choo, Secretlabs technical director and co-founder.

Speaking to Channel NewsAsia, Mr Choo said that e-sports’ access to the new generation, is particularly attractive to potential sponsors. “Almost every millennial plays some sort of games today - from your traditional PC and console, to the upcoming trend of mobile games,” he said.

“Companies constantly work to understand and connect with their audience; gaming is a growing market and we have to recognise that.”

Mr Choo also thinks the critical mass of computer and mobile gamers in recent times, makes e-sports a tempting proposition to invest in at present. “Gaming brands sponsoring e-sports is nothing new."

"The increased focus on gaming these days is due in part to increased interconnectivity... facilitated by live streaming services such as Twitch and social media, which potentially gives gamers a worldwide audience,” he said.

“We are seeing investments from brands and companies that have never been traditionally linked to esports like luxury brands like Mercedes, the NFL and even Jennifer Lopez, who is now an investor in North American e-sports team NRG.”

Just like Mr Julio, Mr Choo urged companies to first do their homework on the e-sports industry before going all in. “E-sports seems to be the gold mine now and everyone is rushing to start something new,” he said.

“However, it’s not something that every brand should go into. I definitely want to caution people that it is not for everyone and they should manage their expectations as well.”

On the local front, however, Mr Choo thinks the local scene is still in its infancy despite Singapore's success on the global stage through Street Fighter gamer Xian, the emergence of local pro gaming teams, as well as e-sports' popularity among females.

"I think in some ways we've taken some leaps forward and in other ways we've taken steps back. While we have more gaming related events we lack established events like the World Cyber Games (WCG)," he said.

"The few established professional gamers often find themselves having to find opportunities overseas. So while gaming has become more mainstream, we still have a long way to go."

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