The explosive growth of eSports has taken the globe by storm in 2015, and the numbers don’t lie: More than 70 million people watch competitive gaming (eSports) across the globe. That’s a big figure, but one that obfuscates key nuances. Namely, the pockets of fans which are at the heart of the eSports movement. These fans are a goldmine, not only for advertisers, but also the organizations, teams and companies within the eSports ecosystem. In order for eSports to continue sustained growth, fans must also double as customers, similar to their role in traditional sports.
Taking a closer look at the dimensions of eSports fans/followers/viewers, it becomes clear the audience:
- is largely millennial and highly engaged
- shows no sign of slowing down (see graphic below, courtesy of Prashob Menon, REDEF)
- has yet to be monetized
According to a Newzoo report:
On a global scale, there are 2.2 billion sports fans who each generate an average of $56 per year. The average revenue for individual sports is anywhere from $20 upwards. Esports enthusiasts on the other hand, currently generate an average of $2.2 per person per year, without game revenues taken into account.
So the potential is significant, but the results are aren’t there. The fact that eSports’ core fan base is a generally advertising adverse group, only complicates the equation. eSports Entrepreneur published a breakdown of who these fans are and why they follow the teams, organizations that comprise the eSports scene. The long and short of it is, the process of converting fans into consumers is a critical bridge that absolutely must be crossed, even if it largely contradicts strong history of organic growth and grassroots community in the eSports world.
Historical Perspective
The early generation of leaders and visionaries, who pushed past the social stigma that gaming held in prior years, and established the foundation for today’s competitive video gaming ecosystem, did so by focusing on the purity of their mission. During this formative era, the notion of commercialization wasn’t just an afterthought, it was laughable. As a result, a counter-culture of sorts took root, one where monetization, profits, business models, etc. held no sway.
The tightly knit community of gamers who sacrificed immense amounts of time, money and personal accolades to push an entirely new genre into existence are the forefathers of everything that exists in eSports today. And it was here, within the LAN parties, the local tournaments and early online communities, that a strong tradition of grassroots involvement shaped the movement. Note: a nearly identical arc existed for extreme sports in the late 20th century.
The same spirit of independence and community first approach prevades every nook and cranny of eSports today. While the worldwide video game marketplace continues to grow year-over-year, and large publishers and peripheral manufacturers are raking in the profits; success in eSports today still requires a commitment to something larger than the profit seeking impulse.
Why Fans Must Evolve into Consumers
Contrast the reality of eSports with the traditional sports industry, and three stark differences become apparent:
- The business of sport is bigger than the sport product. The opposite is true for eSports.
- The nearly complete commercialization of traditional major sports is a given. Whereas, fans in the eSports domain are still leery of commercial encroachment
- Fans of traditional sport are honed to participate as consumers (buying tickets, merchandise, purchasing sport networks on TV to view games). eSports fans are apart of a wider community of contributors, first and foremost.
None of the above differences discredit the viability of eSports; however, its continued acceptance and growth will be determined by how well these gaps are closed. Believe it or not, one of the pillars of major sport in the 21st century is the viability of industry. In fact, converting fans, of all stripes, into customers is the holy grail of modern sport. Along with it, an expectation that fan involvement will be translated into revenue, then used to attract more fans, sponsors, etc. In this regard, eSports must make headway to take its place alongside the mainstay sporting genres.
Walking a Fine Line
Interestingly, the lack of pervasive commercial presence, in comparison to major sports, has benefited the eSports scene, to date. Fans connect deeply with the genuine a sense of community and authenticity displayed across the domain; meaning the solution is NOT to stuff more products, commercials, and/or ads down their collective throats. Instead, success converting fans to consumers will be found in the following ways:
- Offering something of value (see: product or service) for a nominal cost. Premium pricing strategies won’t work. Neither will generic paywalls.
- Freemium models that prize “featurization” of a currently, and an always to remain, free offering.
- Embrace the culture of engagement. Fans will pony up $$$ when they feel apart of where things are going.
Today is Tomorrow’s Yesterday
The seeds for evolving today’s eSports fan into tomorrow’s customer must be planted today.The stigma against commercial influences must be overcome if eSports is to continue scaling current growth. Long key to the worldwide growth of eSports, fans must become accustomed to participating as customers also. Likewise, the entire ecosystem must generate positive commercialization that vibes with the unique history, culture and spirit of the eSports movement. Until then, the gap between traditional sports will remain a chasm.
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Alex Fletcher is founder & president at eSports Group, where he helps customers meet their eSports advisory & consulting needs. When Alex isn’t glued to a screen, he spends time with his wife, their two dogs, and pretends to learn Polish. Feel free to stalk him on Twitter – @FletchUnleashed