Mini Briefing Pack March 2019 - caytoo
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Mini Briefing Pack 1
March 2019
ESPORTS SUMMARY
2
The following presentation is a brief look at
eSports and what the future holds for the global
phenomenon.
• Professional eSports organisers and game publishers organise over 500 leagues and competitions
every year for individuals and teams to compete in.
• Teams consist of the world’s best professional gamers who compete around the globe in game
specific leagues and competitions.
• In 2018 the eSports audience was 380 million people worldwide. This is expected to grow to 600
million by 2023.
• eSports viewership and prize money has already surpassed those of well-established sporting
competitions worldwide.
• Total eSports revenue in 2019 is expected to be more than $1b with sponsorship being the main
driving force behind this astonishing amount.
• eSports teams and competitions have already attracted sponsorship from major global brands.
• Traditional sports like football, basketball and motor racing have the opportunity to attract a new
generation of fans via simulation sports games.
• Current trends include the rapidly expanding Asia eSports following and the rise of mobile eSports
with participation via mobile phone devices.
ESPORTS
3
eSports, short for electronic sports, is professional,
competitive video gaming. Just as conventional
sports hold tournaments for the world’s top players
to compete in for cash prizes and prestige, eSports
do the same. Individuals or teams of gamers come
together in front of live and online audiences to
battle in competitive video games such as League
of Legends or Call of Duty.
Streaming services like Twitch allow viewers to watch their favourite gamers play in real time, and this
is typically where popular gamers and teams build up both reputation and following.
The first official video game competition on record occurred at Stanford University on October 19,
1972. That event invited players to compete in a game called Spacewar; the prize being an annual
subscription to the Rolling Stone Magazine. In 1980, video game competitions hit the mainstream with
Atari’s Space Invaders Championship. The event attracted over 10,000 players and helped bring video
games out of the shadows as a niche product and firmly into the mainstream.
ESPORTS KEY COMPETITION STRUCTURE
4
Below is a snapshot of some of the world’s most prestigious leagues and competitions There are now over 500 eSports competitions played all over the world, throughout the
organised by professional eSports organisations and game publishers. The ESL, MLG, year, and are easily accessible for fans to stream online, attend live events and watch on
ELeague and DreamHack are specialised eSports organisers. Whilst the leagues selected broadcasted TV networks. Regardless of everything else involved in the broad
and competitions are well established the actual locations of the live events are world of video games, spectator appeal will decide whether a game can become a
often rotated. For example, over the last four years, the League Of Legends World favourite eSport or not. New games are constantly created by publishers, however
Championship finals events have taken place in Berlin, Los Angeles, Beijing and last year the popularity and potential to be a renowned eSports game is dependent on how
in Incheon, South Korea. receptive fans are to each game.
eSports
Electronic Sports Major League Valve Riot Games E League DreamHack
League (ESL) Gaming (MLG) Corporation Type: Publisher Type: Organiser Type: Organiser
Type: Organiser Type: Organiser Type: Publisher Founded: 2006 Founded: 2016 Founded: 1994
Founded: 2000 Founded: 2002 Founded: 1996
ESL Intel ESL Overwatch Call of Duty DOTA 2 League of Legends Tekken Team Rocket League DreamHack Starcraft 2 DreamHack
One Extreme Pro League World The International World Championships Championship Open CS:GO Championship Fighting
Masters League League Series Games
Championships
Street Fighter CS:GO DOTA 2 Rocket League
Invitational Invitational Dream League Pro Circuit
ORGANISERS/PUBLISHERS COMPETITIONS
ESPORTS KEY TEAMS
5
Here are some of the most well renowned eSports teams based on prize money
Team Liquid Virtus.pro
earnings and social media following across Instagram, Twitter, Facebook, Youtube Location: Holland Location: Moscow, Russia
Founded: 2000 Founded: 2003
and Twitch. There are approximately 500 professional eSports teams, with 70 teams Games Played: Hearthstone, Counter Games Played: Dota 2, Counter Strike,
having accumulated $1m in prize money. Strike, Dota 2, Street Fighter, Super Smash Paladins, Artifact, Fortnite
Bros, Fortnite, Call of Duty, Artifact Players: 22
Players: 56 Earnings: $12.2 million
Earnings: $25 million Social Following: 1.2 million
Social Following: 1.9 million Sponsors: Megafon, Mr. Cat, DXRacer,
Fnatic Sponsors: Monster Energy, SAP, Honda, Fragstore, Pari Match
Evil Geniuses Location: London, UK
Twitch, Jersey Mike’s Subs, HyperX,
Location: California, United States Founded: 2004
MAxnomic by Need for Seat
Founded: 1999 Games Played: Clash Royale, Counter
Games Played: Call of Duty, Dota 2, Super Strike, Dota 2, FIFA, Fortnite, League of
Smash Bros, Rocket League, Rainbow Six, Legends, Rainbow Six, Street Fighter
Battlegrounds, Street Fighter Players: 54
Players: 19 Earnings: $12.5 million
Earnings: $21.1 million Social Following: 5 million
Social Following: 1.1 million Sponsors: OnePlus, Rivalry, Chillblast,
Sponsors: Monster Energy, Xfinity, Monster Energy, DXRacer, Newzoo,
Steelseries, Aorus, AMD, Twitch, Need for Strafe, Fnatic Gear, AMD SK Telecom T1
Seat, Design by Humans Location: Seoul, South Korea
Founded: 2002
Games Played: League of Legends,
Battlegrounds, Hearthstone
Players: 17
Cloud9 Natus Vincere Earnings: $8.5 million
Location: Kiev, Ukraine Social Following: 1.5 million
Location: California, United States
Founded: 2009 Sponsors: SK Telecom, Pocari Sweat,
Founded: 2013
Games Played: Dota 2, Counter Strike, New Balance, Corsair, Razer, KLevv
Games Played: British Hurricane, Counter
Battlegrounds, Fortnite, Paladins Memory
Strike, Fortnite, Hearthstone, League of
Players: 21
Legends, London Spitfire, Battlefields,
Earnings: $8.3 million
Rocket League, Rules of Survival, Super
Smash Bros SK Gaming Social Following: 2.7 million
Location: Germany Sponsors: GG Bet, HyperX, Monster
Players: 92
Founded: 1997 Energy, Omen by HP, DXRacer, Fragstore,
Earnings: $8.3 million
Games Played: Clash Royale, FIFA, NVIDIA, Newzoo
Social Following: 2 million
Sponsors: Red Bull, Omen by HP, Hearthstone, League of Legends, SMITE
HyperX, U.S Air Force, Secret Lab, Twitch Players: 23
Earnings: $5.5 million
Social Following: 1.3 million
Sponsors: T-Mobile, Razer, Sennheiser,
Mountain Dew, Mercedes
Optic Gaming G2 eSports eSports teams are made up of the best professional gamers from around the world
Location: Texas, United States Location: Berlin, Germany
Founded: 2006 Founded: 2013 and specialise in specific games. Team Liquid, for example, competes in Counter
Games Played: Call of Duty, Counter Games Played: League of Legends,
Strike, Fortnite, Gears of War, League of Counter Strike, Hearthstone, Fortnite, Strike, League of Legends, Hearthstone, StarCraft, Dota 2 and Street Fighter, all of
Legends, Overwatch, Battlegrounds Rainbow Six, Rocket League, Clash
Players: 53 Royale, Battlegrounds, Super Smash Bros
which require different skill sets and strategies. In addition, they also encompass a
Earnings: $7.4 million Players: 67 wide range of game types, from shooters to multiplayer online battle arenas (MOBAs)
Social Following: 5.8 million Earnings: $4.8 million
Sponsors: Mountain Dew, Turtle Beach, Social Following: 1.1 million and fighting games.
DXracer, Scuf Gaming Sponsors: Logitech, AOC, AORUS,
paysafecard, Need for Seat, Twitch,
eSport Management
SOURCE: ESPORTS EARNINGS; SOCIAL CORRECT AS OF 25/02/19
ESPORTS AUDIENCE
6
Audience figures and predictions are based on eSports enthusiasts who watch eSports Global Audience Demographics
more than once a month and occasional viewers who watch less than once a month. (gender, age & location)
Therefore eSports Audience equals eSports Enthusiasts and Occasional Viewers combined.
Global eSports Audience 16-24 38%
(millions) 25-34 35%
600 35-44 19%
45-54 6%
555
29% 71% 55-64 3%
511
466
422
380
335
18%
Europe
281
14% 53%
North America Asia
2016 2017 2018 2019E 2020E 2021E 2022E 2023E
SOURCE: BUSINESS INSIDER INTELLIGENCE ESTIMATES; NEWZOO, 2018 SOURCE: GLOBAL WEB INDEX, 2017. NEWZOO.
ESPORTS AUDIENCE COMPARISON
7
In 2018 the League of Legends World Championship had 99.6 million unique viewers. 2018 Prize Money across major sports
For context, this reaches nearly the same highs as the 2019 Super Bowl. Invictus ($ millions)
Gaming, a Chinese team, was the driving force behind the recent high viewership
of the 2018 League of Legends World Championship Final, as previous years were
dominated by South Korean teams. TOUR DE FRANCE 2.6
MELBOURNE CUP 5.2
League of Legends v. recent sporting events LEAGUE OF LEGENDS
WORLD CHAMPIONSHIP eSports 6.4
LEAGUE OF LEGENDS OTHER SPORTS
NHL STANLEY CUP 7
INDIAN PREMIER LEAGUE 8
MONACO GRAND PRIX
120 THE MASTERS 11
110
US OPEN 12
ICC CRICKET WORLD CUP 14
99.6 WIMBLEDON 17.1
VIEWERSHIP
(MILLIONS) FIFA CONFEDERATIONS CUP 20
58 DOTA 2 THE INTERNATIONAL eSports 25.5
43 FIFA CLUB WORLD CUP
28
36
NBA FINALS
Increased media rights deals and sponsorship has seen prize money in eSports
increase significantly over the last few years. The international prize pool in 2018 was
8 $25.5m, significantly more than a number of recent sporting events including the
2017 FIFA Confederations Cup, 2018 US Open (Golf), The 2018 Masters Tournament
31 and cricket’s biggest T20 competition, the Indian Premier League.
2015 2016 2017 2018
YEAR
SOURCE: FIFA, GAMESPOT, WIMBLEDON, TOTAL SPORTEK, SPORTS ILLUSTRATED, PGA, IPL, NHL,
SOURCE: RUGBY WORLD CUP, INDEPENDENT, RIOT GAMES, THE TELEGRAPH, CBS ESPORTS EARNINGS, VICTORIA RACING CLUB, TOUR DE FRANCEESPORTS REVENUE AND GROWTH
8
eSports revenue over the last 3 years has shown significant growth, particularly for media
rights and sponsorship. 2019 revenues are expected to reach an impressive $1.1 billion, with
sponsorship and media rights accounting for 65% of the total revenue. Other components TOTAL REVENUE
contributing to eSports revenue are merchandise & tickets, publisher fees and advertising. SPONSORSHIP & MEDIA RIGHTS
From 2016 to 2019, eSports sponsorship is expected to increase by 170% to $456.7
million. The driving force behind this amount is the recent increase in non-endemic
brands like Mercedes, Nike and Coca Cola investing in eSports in order to reach a very
specific audience who are often hard to reach. The growing number of eSports fans offer
brands the opportunity to reach a global, predominantly millennial, male audience.
1.1
1
0.9
0.8
0.7
REVENUE
($ BILLIONS) 0.6
0.5
0.4
0.3
0.2
0.1
2016 2017 2018 2019
(E)
YEAR
SOURCE: NEWZOOESPORTS SPONSORSHIP BREAKDOWN
9
50 of the biggest eSports teams’ sponsors have been analysed to gain a better There is clear evidence that emerging eSports markets are attracting sponsorship from
understanding of the types of brands investing in eSports. Of the 261 team sponsors, major global brands. Analysis of the League Of Legends competition events in Asia and
159 are endemic to eSports leaving the remaining 39% non-endemic brands. When Latin America shows that sponsorship is not restricted to minor, domestic brands, but by
comparing the top 10 teams (see page five of this document) to the next 40, there is multinationals keen to push their brand into developing markets.
a notable difference with non-endemic brands partnering the more successful teams.
Sponsorship Breakdown for Top 50 eSports Teams % Non-Domestic Sponsorship (League of Legends)
Do
ic
m
m
Non-Ende
es
Non-Dom
tic
39% emic
61% 69% 31%
nd
E es
tic
SOUTH AMERICA ASIA
Comparing Endemic and Non-Endemic Sponsorship:
Top 10 eSports teams v. next 11-50
Brazllian League of Legends League 100%
Non-Endemic Endemic League of Legends Latin America League 100%
League of Legends Pro League China 80%
Top 10 Teams 48% Top 10 Teams 52%
League of Legends Mid Season Invitational 67%
The Kuala Lumpur Major 57%
The Rest 36.5% The Rest 63.5%
League of Legends Korea 25%
ENDEMIC SPONSORSHIP DEFINED AS SPONSORSHIP BY BRANDS WHO ONLY SELL PRODUCTS WITHIN THE VIDEO GAMING INDUSTRY.ESPORTS AND SPORTS
10
Following the emergence of eSports over the last decade, sports like football,
basketball and motor racing now have an opportunity to attract a new generation
of fans through simulation games like FIFA, NBA 2K and Formula 1. For sports rights
holders and their brand partners, a key element to the appeal of eSports is that
with no physical assets required there is effectively no barrier to entry. It offers an
effective route to penetrate markets their sport does not currently have a foothold in,
enabling them to reach new audiences.
FIFA Formula 1 NBA 2K
• In 2014, EA cited data from an ESPN sports poll • The 2018 Formula 1 eSports Series had over • The NBA recently announced that people who
stating 34% of Americans became football fans 100 million social media impressions, 20 million purchase real-life player jerseys will receive in-
after playing FIFA. online video views and was watched live by 4.4 game rewards for NBA 2K’s MyTeam and
million people. MyPlayer modes, highlighting the connection
• 34% of FIFA gamers in the US said they the NBA makes with the NBA 2K video game.
became football fans after playing the video • 14% of regular viewers under the age of One is an advertisement for the other.
game, with 50% taking more of an interest in 25, Formula One can utilise the F1 eSports
the sport having played it. Series to boost its appeal to a younger audience.
SOURCE: MALLORY GROUP, ESPN, EA SPORTS, NBAESPORTS TRENDS
11
Mobile eSports Interaction between traditional sports and eSports Influence Streamers
Mobile gaming, which takes place on mobile There is increasing interaction between Since broadcasting game sessions is a natural
phones, is currently the fastest growing area of eSports and traditional sports. eSports titles part of their career, eSports players will often
gaming. This naturally extends to eSports, with that are developed on the basis of traditional provide advertising space on their streams for
mobile eSports estimated to be a $60bn market sports help to bring a newer generation of fans teams and brands. Monetised by a combination
in 2019 driven by developed franchise structures, to the traditional sports fan base and vice versa. of adverts and subscriptions, some of the players
professional leagues and live stadium events, are becoming genre stars in their own right, led
attracting millions of viewers. by the Fortnite-playing Ninja, who currently has
over 13 million followers on Twitch.
Recognition of eSports as an official sport Opportunities for Brands Southeast Asia to Continue Rapid Growth
eSports players are starting to be recognised Brands can leverage eSports to reach dedicated Southeast Asia is 2019’s eSports region to
as athletes. The International Olympic Committee audiences in new markets, especially via live look out for. The region boasts the fastest -
(IOC) has recognised eSports as a sporting streaming and social media versus traditional growing esports audience, which will reach 31.9
activity and was introduced to the 2018 Asian broadcast. Activation requires careful million in 2019. Competitive games like Starcraft
Games as a demonstration sport. Tokyo 2022 consideration with a focus on merchandise and and Dota 2 will be medal sports at the 2019
could see the official debut of eSports, however content, particularly downloadable content. Southeast Asian Games.
the introduction of an official world regulated In FIFA 19, Adidas released a special “digital”
governing body will determine the outcome. 4th kit for several teams in the game. This
complemented the 3 kits they manufacture in real
life, which also featured in the game.12
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