The League of Legends World Championship shares all the hallmarks of more traditional sporting events, be it passionate fans, lavish stadiums or even old rivalries. In terms of sheer entertainment and popularity, it seems as though the competition could stand toe to toe with any other international tournament. Perhaps this is why it boasts such impressive viewing numbers.
The finals of last year’s tournament saw a sell-out crowd of 40,000 people fill Seoul’s Sangam stadium, with just over 27 million viewers watching from around the world. To put this into perspective, that same year the NBA finals attracted 15.5 million viewers. Despite these staggering numbers, League of Legends is only one of the plethora of games that make up the growing industry that is competitive eSports. Whilst eSports is currently dominated by MOBA’s (multiplayer online battle arena) like League of legends, FPS’s (first person shooters), RTS’s (real time strategy) and fighting games all have loyal followers, growing audiences and their own events.
League of Legends 2014 World Championship final in Seoul
All said, the eSports market is worth $612 million according to a recent SuperData report. The industry brought in 206 million viewers in 2014. Despite the immense number of viewers, these types of tournaments actually end up losing money. The cost of renting out arenas, making sure that the event’s production value is up to scratch and doling out large cash prizes are not quite matched by the value of ticket sales, sponsorships and ad revenue. So why has Riot Games (the creators of League of Legends) continue to host it?
Whilst the thought that eSports may become lucrative in and of itself one day is no doubt a driving factor, the real reason significant resources continue to be poured into it is the belief that there is no better way to drive in-game engagement. What’s more is they have the numbers to back that up.
Esports is often compared to the gaming industry as a whole, whilst it does share certain characteristics, such as being popular with the ever elusive demographic of male millennials. It is important to note that there are key differences between the eSports market and the larger gaming market. First and foremost, due to the sheer number of hours that need to be invested in order to gain proficiency in ones chosen game, eSports enthusiasts tend to be incredibly dedicated and engaged with their chosen game and its surrounding community.
In addition, eSports viewers spend as much as double on their gaming peripherals (mice, keyboards, etc.) when compared to the rest of the video game market. A recent report by Eventbrite concluded that after attending an eSports event, gamers were 74% more likely to play the game more often, 64% more likely to follow a player or team that they saw participate and perhaps most importantly 47% more likely to purchase content related to the game. Not to mention the fact that these tournaments are starting to attract bigger and bigger sponsors such as Coke and American Express.
Riot Games know that for such a young industry exposure is key to future growth, with Esports projected to hit 335 million viewers by 2017 and is estimated to generate $1.8 billion by the year 2020, it seems as though their strategy is going to come up big.
Debates have raged as to eSports being an actual sport, but the conversation is tipping toward the affirmative. This is still an emerging phenomenon and so much needs discussion: How does the business operate? Who are the players? What emotional benefits do they get? What are the consumption patterns? What does the community look like? And where do brands fit in? We’ll be covering this in an exclusive panel in sponsorship with PwC on Tuesday at our studio in Cannes. Stay tuned..