Commentary

ESports: The $1-Billion Market You Don't Know About

Sixty-four percent of the U.S. population are gamers, according to Nielsen’s 2017 “Games 360 U.S” report. Take a second to let that number sink in. Here is another fancy number: according to SuperData’s 2016 research, eSports (multiplayer online games played competitively for spectators) generated almost $1 billion in 2016.

These numbers only begin to explain the phenomena. As more and more brands and even traditional sporting groups start joining in on the esports sensation, cutting a piece of its revenue pie, it is obvious who is the new “it” kid in town. Only this kid isn’t going to disappear, it’s a new reality to be acknowledged.

It is no surprise therefore that many researchers, bloggers and fans have written about the potential revenue in esports (expected to generate $1.4 billion by 2019) and about how game publishers, traditional sport teams and brands should react to this.

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Sixty-seven percent of gamers in 2017 stated they play video games to be social. To understand the reasoning behind this percentage, we must understand the community that established around eSports: 94% of eSports fans are gamers (per the Nielsen report), meaning that fans are often professionals themselves. These are mostly Millennials, who often play the game in order to interact with other gamers. They enjoy the social interaction just as much and perhaps even more than they enjoy the game itself. In essence a unique kind of a social network.

Gamers form groups (both amateurs and pro) and analyze each other's techniques. This all happens online and often in real-time. Gamers stream their games live, other gamers interact with them and one another. As in traditional sports, the truly professional rise up to stardom and enjoy their own fan base, and endorsements.

ESports still acts like traditional sports in many ways. Fans watch games and can play in junior leagues trying to work their way up. Sponsors sponsor the top-notch players and for the average player, supporting their star means direct donations.

Isn’t it about time esports fans and gamers truly benefit from the advantages of the real-time online platform they use? It is a platform that enables unique engagement within the community, an engagement that has yet to reach its full potential.

“While so many companies are focused on the broadcast aspects of eSports, we are convinced there are greater opportunities on the experience and the engagement piece beyond consumption. Ninety-four percent of eSports fans are gamers themselves, and that’s the majority of a fan's time,” says Jonathan Weinberg, CEO of Quarterback Inc.

Despite their being a very active community, and despite the “real-time” effect eSports offer (everything happens live), real-time engagement between pro and fan-gamer is very limited. To reference from traditional sports, think of eSports as offering the fans the best seats in the house to a game played by their favorite gamer. Imagine you had front-row tickets to the next LeBron James game, eSports does that for fans. It even allows fans to buy and send LeBron some lucky socks, so to speak, in order to help him win the game.

As awesome as this truly is, it doesn’t utilize the real-time character of online games: Imagine you could make LeBron’s basketball faster or lighter at the precise moment he aims to score; the impact you would have on the game is unparalleled. Imagine the real-time unmediated gratitude you would receive directly from LeBron, a fan’s dream come true.

With such a strong engagement potential, it is no surprise that social giants like Facebook and Twitter are working to become strong live streaming platforms (not to say that Twitch is losing its spot center stage). But gamers want to be a part of something bigger than yet another social network, they want to be a true part of their idol's success.

Companies who don’t invest in eSports now will look back in a few years and feel like people who had the opportunity but didn’t invest in Bitcoin, or took seven years to create a Facebook page. ESports is here and it is here to stay. The audience is there, its active, engaged and growing.

1 comment about "ESports: The $1-Billion Market You Don't Know About".
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  1. Dan Ciccone from STACKED Entertainment, February 8, 2018 at 9:36 a.m.

    We’ve been encouraging our clients to participate in the space for the past 4-5 years. Still so many awesome ways to get involved and it’s been a privilege to shepherd in several non-endemic brands into the space

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