Virtual Games, Real Opportunities

The new phenomenon of e-sports is offering marketers huge opportunities to build new fan bases. But not all brands are rushing to join the game.

With 161 million people now watching e-sports globally every month, most of them young men aged between 21 and 35 who are increasingly difficult to reach through traditional advertising channels, the sector is growing into a mainstream alternative to traditional brand sponsorship. But, so far, only a small number of brands have been eager to engage.

E-sports includes any multiplayer video game played competitively online for spectators. Investment in the sector has largely been driven by brands with an existing involvement—such as gaming accessory manufacturers Razer, Hyper, and Turtle Beach—or sports teams and leagues, with teams from the NBA, the Premier League, and La Liga sponsoring or signing players to their own e-sports teams. Meanwhile, the leagues themselves have explored setting up their own e-sports leagues. For example, the NBA has launched a major partnership with Take-Two Interactive—a multinational publisher and distributor of video games—to launch the e-sports Basketball League for the NBA 2K game. For them, it’s a chance to grow and develop fan bases, while also creating new and appealing assets to sell to current and future corporate partners.

An Untapped Market

However, for the market to keep growing, the various games and leagues within the e-sports umbrella need more diverse and traditional brand partnership opportunities. While Coca-Cola, Intel, Buffalo Wild Wings, Bud Light, and Gillette have all struck deals in this space, e-sports remains largely untapped.

The reason? Many CMOs and marketers do not have the sense of trust needed to invest in this space in a major way. This is partly because the industry is in its infancy with an overwhelming number of stakeholders, meaning proving its value is difficult to those not well-versed in the sport. In addition, CMOs and marketers do not know where to start or who to talk to in order to initiate developing and activating brand partnerships. Key decision makers at big brands are far more likely to favour more traditional–and in their eyes safer–investments in sports such as football or athletics than venture into video games.

Many CMOs have also been turned off by the violent nature of some of the best-loved games, such as “Call of Duty,” “Destiny,” or “Dota 2.” While brands popular with young male gamers—Domino’s Pizza, Bud Light, Monster Energy, and so on—are happy to sponsor a game where you get bonus points for a headshot, brands with more of a family appeal or reputation are reluctant to sponsor simulated violence. However, this could all be about to change.

Broader Appeal

Last week, at E3, the world’s largest and best known gaming conference, e-sports witnessed a number of announcements of new family-friendly games coming to the discipline. “Super Smash Bros” and “Splatoon 2” for the much-lauded and successful Nintendo Switch console join “League of Legends” in a roster of games that feature no blood or gore, creating a more appealing product.

With growing appeal to more brands and gamers, now is the perfect time for a CMO to get involved in e-sports, not least because the ROI is huge. The industry commands an eager fan base of young people who are willing to spend hour after hour at venues and online, providing plenty of opportunities for brands to engage with them. And due to the fact the sport has yet to mature, its sponsorship costs are favourable when compared to sports with similar viewing figures.

Play By The Rules

But the sport doesn’t suffer fools easily. The fan base is even more fickle and savvy to marketing than most people. Authenticity is of paramount importance. You have to make sure the way you activate your brand sponsorship fits with the tournament, game and/or venue of choice, and plays well with the consumer and brand value exchange. Slapping a brand logo over everything in sight simply won’t work, and will actually create a lasting negative sentiment among the fan base.

One of the best examples of the sport maturing, and brands taking it seriously, was seen last week at E3. Intel and the Electronic Sports League (ESL) signed a new partnership, signalling real investment starting to flow towards the sport. The multimillion-pound deal means that Intel will now power all ESL’s streaming and live operations, with the two teaming up for the new Intel Grand Slam series of 10 competitive “Counter-Strike: Global Offensive” matches (it’s the most popular shooter in e-sports). They’re offering a $1 million bonus prize to whoever wins four out of the 10 matches. Finally, they are also partnering to tackle VR e-sports with the VR Challenger League, which will compete in Ready at Dawn Studios’ multiplayer “Echo Arena” VR game.

While Intel may have an obvious connection, being a global computer giant, brand marketers in other categories will find a lot more to connect and bond over with the growth of other properties like Nintendo’s e-sports portfolio. The iconic brand has witnessed a resurgence in fortunes following the launch of the Switch, and it is expected that family-friendly titles will broaden the appeal of e-sports to a wider gaming fan base and wider range of brand partners.

To The Winner, The Spoils

Clearly, for those willing to invest in this new area, there are huge opportunities to build new fan bases and engage with this audience. Assets such as naming rights, branded content, experiential activation, tech integration, jersey branding, and beyond are available for brands willing to invest in this space. As the market matures, further opportunities in co-branded merchandise will grow, as too will direct selling to fans while they are viewing livestreams of games.

As a CMO, if you get involved now, you have first-mover advantage. Activate your e-sports sponsorships and partnerships effectively and authentically, and you can grow the sport and bring untold benefits to your brand—a win-win situation for all.