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What's Next in Esports?

With the work-from-home phase ongoing, it was the perfect time to “attend” a two-day virtual Esports conference – #EsportsNext – put on by the Esports Trade Association. As a career-long collegiate, Olympic and professional sports person, it was a time to learn from this exploding sector of sports.

Below are my takeaways as I clean out the notebook from conference that was excellent on content and well-produced.

Top of the 2nd Inning: While Esports is experiencing an explosion in popularity, the industry still has a self-perception of being in its early stages. In baseball analogies, panelists feel the industry is in the “top of the second inning” and in global football (aka, soccer) terms it is in the first 5-10 minutes of the match.

COVID Kids: The home confinement since March has been a boon to Esports, creating fast growth of the industry and the coining of a term of new gamers. (Confession … I did buy a new Xbox when the pandemic started, but it is safe to say I won’t be a competitive gamer anytime soon.) But complex games are great for the existing players but are intimidating to new players. This is no different than the intimidation of playing golf or trying any new sport for the first time. So, expect to see even more outreach into YMCAs or Parks & Recs departments for Esports opportunities for kids to complement existing offerings. Esports speaks the same language to “help parents and kids understand the pipeline” of Esports.

All About the Data: Esports can create volumes of data, and even more than most sports that we even consider to be data and stats heavy. Because of this, the Esports industry sees itself having a competitive advantage and an “early accelerator” over other sports. In addition to gaming data, expect to see growth in the trend of analysis of biometric data to improve athlete training and performance.

Authenticity: The theme of being authentic was loud and clear from the Esports community. Whether a big brand or a new game developer or publisher, the message was clear: Take the time to learn and understand the Esports space first, and don’t come in with arrogance just because of success in another sector. Coming in with the “we know best” attitude is the fastest path to failure. Listen, learn and respect the culture.

Advice for Big Brands: The stand-out panelist of the conference was Justine Stauffer from Molson Coors Beverage Company, who manages the Miller Lite brand in Esports. My experience at sports marketing conferences is that “the bigger the brand, the less they are going to say.” She was the opposite. She was open, honest, entertaining, insightful, and self-aware. Below are some of Stauffer’s key insights:

· Take risks and have some fun, but with humility

· The community will “smell inauthenticity a mile away”

· 50% of the Esports audience does not watch TV, so Miller Lite knew it had to diversify spending beyond traditional sports

· Miller Lite approached the space as a brand relevance play vs. a volume play

· The company felt Miller Lite had a “right to play” (aka, authenticity) that you could enjoy a beer while playing games so it had a natural place in the community

· The marketing team conducted education sessions with senior leadership to teach them the Esports space, and convince them to divert marketing dollars to Esports

· Miller Lite created an internal “eSquad” of marketing leaders and even more junior employees who were gamers

Esports Tourism: The state of Georgia and the cities of Miami, Florida, and Washington, D.C., have dedicated staff to building an Esports business of conferences, conventions and attracting game developers. Neil Johnson, the first Director of Esports from Events DC called it the “fastest growing segment in sports tourism” to reach younger and digital audiences. In the case of the Georgia Department of Economic Development, they follow a model from film and television and extend a 30% Esports tax credit on spends over $500,000 for broadcast events.

DraftKings Bullish on Esports: According to DraftKings CEO Jason Robins in an earnings call, “We significantly expanded our Esports offering and have seen exponential growth in this category. We added popular Madden simulated games and began to include streaming sports within our app, which has become a very popular feature. We believe Esports is going to be a huge category. It’s when not if...we believe ultimately Esports betting will be if not the biggest, certainly one of the biggest categories of sports betting over the long-term.” In general, there was a feeling that Las Vegas is moving too slowly with sports betting and Esports, especially from Unikrn co-founder Rahul Sood.

Sponsorship Dollars: There was consensus in a Sponsorship Valuation Modeling panel that any sponsorship dollar spent on Esports came at the expense of “traditional sports” [see below] budgets. Brands such as State Farm saw immediate results in awareness in younger audiences, and the metrics are mature enough to have comparable numbers against MLB, NBA, etc. State Farm, for example, was nervous about the Esports space, but found social media sentiment was 99% positive of them entering.

“Traditional Sports”: The Esports world consistently refers to “traditional sports” such as football, basketball, baseball, etc., and I find myself doing the same. That word is a double-edged sword, however, as it is accurate but can have an insinuation of “old” built into the term. Maybe that is justified in many cases, though! I will settle for just calling it sports.

Congratulations to the Esports Trade Association for the excellent conference. It also created a wealth of ideas, so stay tuned!

I definitely will be an avid follower of how this evolves with Esports and sports!


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