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On the Cutting Edge: The 2019 Esports Landscape

21
Jun

On the Cutting Edge: The 2019 Esports Landscape

Friday, June 21, 2019

At last, the era of shaming gamers for spending hours and hours behind their screens is coming to an end.


For many who belong to the tightly-knit and enthusiastic gaming community, this development has already happened. Only now is ‘mainstream culture’ finally starting to grasp the reality of this situation.


Massive box office productions like Ready Player One and the presence of esports on television demonstrate that the narrative around gaming is shifting dramatically in this country.


In general, unlike in the past, there are no longer hostile relationships between parents and kids who spend most of their time playing video games. Now, most parents of gamers are supporting their children’s decisions. Like proud parents in any other sport, many gaming parents are even forcing their friends to watch their children compete.


Day by day, esports is becoming a more significant part of the American sports landscape, not just socially, but financially as well. In recent years, several notable esport leagues with powerful ties to massive sponsors and professional sport franchises have been developed.


By the end of 2019, esports revenue is projected to reach over $1.1 billion. While the esports industry continues to surpass unprecedented heights, its revenue will be distributed across a countless number of various games and events.


At this point, esports has proven it is not a fad that will dissipate anytime soon. During the rest of this year and beyond, it will be especially intriguing to witness what will happen in the esports world.


From here, we’ll take a look at some categories of esports that are on the rise, including specific games, sponsors, and ways that gaming is being incorporated into the traditional sporting discussion.


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The Games

Pictures of Popular esports games
Pictured are some of the most popular esports. Some, like League of Legends and CounterStrike: Global Offensive, have been around for a long time, while new ones, like Overwatch, are starting to gain traction. Image Courtesy of Ilna Club

Traditionally, gaming has assumed a much different reputation with older generations compared to the one of the younger generations today.


Since gaming typically used to be an activity that a couple couch potatoes would enjoy by themselves, it can be difficult to comprehend the depth of the current esports environment. In the past decade, esports has become so much more than it used to be.


There are games being played that connect dozens of people at a time from around the world to either compete for a singular goal or to prove value by establishing dominance over a group of individuals.


It can be daunting to try and follow esports when there are so many games, events, tournaments, players, and teams to keep track of.


However, the fear that has existed in the older generation is being replaced with heightened excitement from a younger crowd.


Take Fortnite for example. Currently, Fortnite is a game that perfectly embodies how esports is dominating the social landscape of the country.


Epic Games (the makers of Fortnite) started out making an extremely bold decision, making the game completely free to play, and allowing anyone to download it. Many in the gaming world were confused and surprised, but the decision paid off in a massive way.


The company earns substantial revenues through its use of microtransactions, sponsored events, and wide array of developer-organized competition, including the highly-anticipated Fortnite World Cup, which will take place later this summer.


But the real way Fortnite has been making a significant impact has been through its total embracement of streaming culture and the streamers who make the magic happen.


Streaming represents the idea that people like to watch entertaining people play their favorite video games, and are willing to pay money to do so. And as crazy as it sounds when I try explaining it to my parents, it is the real deal.


Annually, there are certain streamers who earn millions of dollars to broadcast themselves playing games every day for thousands of people at a time.


At any time of day or night, a person can log on to Twitch and surely find someone playing his or her favorite game.


And this celebrity streamer influence on the game has benefitted both sets of parties dramatically.


For the entertainers, they have a game to play and an ability to display their skills and personalities to a wide audience, attracting fans and making their brand more enticing to advertisers.


Nearly every game has a devoted fan base filled with enthusiastic young consumers. Many of these fans not only purchase the games themselves but also contribute toward merchandising, tournament & event tickets, and brand engagement with sponsors of content.


Esports viewership has been rising every year, with publications like NewZoo’s Global Esports Market Report projecting that number to be 453.8 million in 2019, and that number is bound to get even bigger as time goes on.


And what all that boils down to is the overwhelming number of brands who are seeing a golden, somewhat untapped market in front of them, and are jumping into the world of esports sponsorship headfirst.


The Sponsors

Logos of non-endemic advertisers in esports
Some of the logos of brands who are currently, or are planning on, advertising in esports. Most of these companies are not gaming companies, and this displays a shift in the market for advertisers. Image Courtesy of Esports Vision

Whenever a new trend takes off in the United States, Americans can count on the fact that advertisers will be there, always seeking to pursue the consumer. From a marketing perspective, tracking the interests of consumers generates an accurate understanding of how trends in society are evolving.


Currently, countless companies have their eyes on the viewership of esports...and they want in.


Of the $1.1 Billion in projected esports revenue in 2019, nearly half ($456.7 Million) is generated directly from sponsorships. showing that the big bucks are being spent by marketing departments in order to get in front of audiences.


Many of these big-name sponsors already create products in the esports industry, such as HP’s line of gaming computers or HyperX’s line of gaming accessories. Thus, these types of organizations have a built-in need to advertise within the realm of esports.


At the same time, other advertisers like Nike, Geico, and Mercedes Benz are starting to see the value of the ever-growing gaming audience. The fact that car insurance is being advertised as part of an esports tournament is a sign of a total shift in the market for advertising in gaming.


At this point, the number of people tuning in to Twitch on a regular basis is so substantial that the world of traditional business practices is being forced to take notice.


For every stream, there will be a sponsored activity. For every event, an official beverage.


In a lot of ways, it marks a milestone for esports as a serious phenomenon that is going nowhere anytime soon, and that permanence has even drawn the attention of their greatest competition: professional sports.


The Leagues

NBA2K League Logo
The NBA 2K League Logo. This league specifically has benefitted greatly from a partnership with the NBA and other sports are starting to see how they can integrate esports into their product. Image Courtesy of NBA 2K League

Currently, with the amount of money being invested in competitive gaming, it makes sense that there had to be some added structure to the way games are played. At the moment, centralized leagues seem to be the way of the future for esports.


For non-sports games (Fortnite, Call of Duty, etc.), leagues are often operated by the game developers themselves and exist as a distinct entity. Since the developers are also responsible for a particular game and how it changes, they usually run the league through a franchising model or an open competition format.


This system has proven to be extremely lucrative for video game companies like Activision-Blizzard. Companies such as Activision-Blizzard have nearly full control over a substantial amount of the market for a particular game, and they acquire huge ad revenues and television deals as a result.


Most sports games (NBA 2K, Madden, etc.) possess partnerships with the professional league that each game represents. While some of the partnerships are strong, others seem to exist more out of necessity.


For instance, the NBA and NBA 2K have an extremely tight relationship. The NBA is fully invested in the success of 2K’s operation. Each 2K team is operated by its actual NBA franchise, and they often reference each other on social media.


Thus far, this mutual relationship has proven to be a huge boon for the NBA. As a result, other professional leagues have been paying more attention to the positive consequences of embracing esports.


And they aren’t alone.


The state of esports is on the rise so far this year and figures to grow in the years to come. The world is continuing to evolve, and with it the entire definition of sports and entertainment.


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