Esports is a world of spectator friendly gaming that has experienced explosive growth over the last few years. Tournaments offer prizes that are on par with some of the largest traditional sporting events on the planet. The audience for Esports is growing with an estimated 100 million viewers. Much of this viewership is thanks to the sport’s popularity in Asia.
Corporate partnerships and sponsorships are the main source of revenue for Esports. Ticket sales, broadcasting rights, as well as merchandising are responsible for the additional revenue. According to some estimates, Esports will generate in excess of $345 million in North America alone. Add that to the more than $500 million of overseas revenue and it is clear to see that Esports is a form of entertainment that has found a solid audience.
To be fair, when compared to heavy hitters in North America, such as the NFL or the MLB, Esports’ revenue is relatively small. In 2017, both of these forms of organized sports brought in $10 billion USD respectively.
Are ESports Ready for the Mainstream?
Esports continues to grow in revenue and is attracting more investors. Media giants including ESPN and Turner Broadcasting are showing Esport tournaments and competitions. Twitch, a platform designed to live stream video games, was purchased by Amazon in 2014. Since that time it has been a leader in the world of online game broadcasting. YouTube also saw the potential of live streaming gaming and created YouTube Gaming.
To put in perspective just how popular Esports have become, go to your browser and search the term “LOL”. You may be surprised to see that instead of seeing the phrase “laughing out loud” as the top result, you will see League of Legends. This is by far one of the most popular competitive Egames on the planet. This game has led to the creation of a worldwide community of players and enthusiasts known as League of Legends Champions Series.
All of this started with a group of friends getting together and playing at LAN parties in each other’s garages. It has spawned into networks of professional leagues, many of which have influence internationally.
A good way to gauge the popularity of Esports is to look at the prize money that is being awarded to winners and compare it to what champions in traditional sports receive. Prize money for the Kentucky Derby is around $2 million. The prize money for the Daytona 500 in 2018 was approximately $15.5 million. In 2018, the international DOTA 2 Championship had a total purse of $25 million.
In 2017, League of Legends held its world championship in Beijing. At its peak it boasted 106 million viewers. To put that in perspective, in 2018, the Daytona 500 had approximately 9.3 million viewers. The US Golf Open in 2018 had approximately 9.1 million viewers. The 2017, the Tour de France came in at just over 7.3 million viewers.
This means that the Esports competition in 2018 had a higher viewership than Wimbledon, the Daytona 500, the US Golf Open, and the Tour de France combined. At 106 million viewers, the League of Legends championship came in just shy of the peak viewership for the Super Bowl in 2018, which was 116 million viewers.
Ninety-eight percent of the viewership comes from China. The vast majority of viewers are younger. A poll showed that 58 percent of people between the ages of 14 and 21 said that they watched live or recorded video of people playing competitive video games. Among adults, only 16 percent said they had watched Esports. The gap is quickly closing and, check out this infographic to see this in actual numbers
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Advertisers and marketers are keenly interested in seeing if Esports will become as big or bigger than the NFL, especially when it comes to revenue. If polling information done among younger fans is any indication, the answer is yes. The same poll mentioned above showed that 38 percent of youth in America said that they were fans of Esports or some form of competitive gaming, whereas 40 percent said that they were fans of the NFL. A good group of these Esports fans are men between the ages of 18 and 35. That is a prime group to target with advertising.
What Is the Future of Esports?
A number of market analysts believe that Esports is a market with untapped commercial opportunity. It is a market that has significant room for growth. The market is high value, global, and continuing to grow. There’s little doubt in the eyes of many that Esports will eclipse traditional sporting events in the form of viewership and revenue produced within the decade.