Thinking Gaming is Just a Hobby? By 2021 Esports Alone Will Move 1.6 Billion USD
By Valente Villamil
The hours that hundreds of millions of people worldwide spend on gaming have evolved to become a multimillion-dollar business known as esports. With the support of sponsors, media and, above all, fans, video game competitions are set to grab hold of a huge slice of the entertainment industry from conventional professional sports leagues.
Just last year, esports market revenue worldwide was estimated at 655 million USD, a number that by 2021 will grow 2.5 times to 1.6 billion USD, according to Statista. Simultaneously, it is expected that the number of esports viewers will grow from more than 300 million to over 550 million, according to the same source.
Seen in the context of the video game industry writ large, estimated at over 100 billion USD according to an analysis made by the Financial Times, esports is an important growing source of business revenue; Indeed, the advent of esports has resulted in entirely new branches of the gaming industry to take shape, such as the MTL ESPORTS Academy, a Montreal based institution that focuses on training young players to become professional esports athletes.
It is the equivalent of a junior hockey school, where you might send your children so they learn and develop the necessary skills to become good players and, eventually, play in the NHL. Some of the best esports players today can receive a salary between $500,000 and $1 million USD per month, besting even the top earners in the National Hockey League.
"There is really a demand for that (the Esports Academy). People are not aware of it, like baby boomers and people from other generations with young kids or middle age kids who are passionate by gaming," said Benjamin Denis, marketing director of MTL ESPORTS Academy.
But how can this burgeoning phenomenon be explained? The reality, according to Denis, is that for publishers and game developers such as Epic, Activision, Ubisoft, and Electronic Arts (EA), esports leagues are being used as a marketing tool. Blizzard Entertainment, the mastermind behind Overwatch, a First Person Shooter with over 40 million players around the globe, is the quintessential example of esports as supportive to their business.
"For publishers, esports has another word, it's called marketing. So, when you are a publisher like Blizzard and you want people to play Overwatch, the best way to have that is to create an esports scene around it," said Denis.
This way, players find increased value in the games they play, which, in turn, will spark a financial return for video game companies.
"Right now, I could play any other game or I could play Overwatch. If I play Overwatch and I am good enough I can get into the pro scene, and if I get in the pro scene, I get 50,000 US dollars per year," added Denis.
Opportunity for Brands
Among the factors that support the rocket rise of esports is the pervasive and deep brand engagement between fans and esports. According to a Nielsen study, only 10% of fans have negative feelings towards brand involvement. This means that brands, that not only include gaming companies, have plenty of space to develop creative campaigns in esports events. Esports sponsors include software and equipment companies such as Twitch, Alienware, Nvidia and Hyper, clothing brands such as Adidas and Meta Threads, and even from the beverages industry.
Game On! Says Media
Another key component of the success and promising growth for esports is the media. Right now, social media and streaming remain the principal platforms for broadcasting esports events, with the easy access to these tools has helped to spread the word on professional gaming.
Big sports media companies, however, have already turned their sights into the gaming industry, which could bring esports to a massive number of people through television programming.
Currently in the lead of this trend is ESPN, which only last month closed a deal with Blizzard to secure the broadcast rights of Overwatch, although the details of the agreement have not been revealed. The sports network has also closed a deal with EA to host the Madden Championship Series - a pro esports league of the NFL inspired game, marking yet another milestone in the normalization of esports as a business and a pastime.
Do a Barrel Roll and its team of reporters will be following the ESports scene. If you would like to offer your own comment, please get in contact with us at http://www.doabarrelroll.ca.