Esports Research PDF

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Esports – Team Occupola Business owners want to build Brand awareness. 3 competitors - Fortnite, League of Legends, Rocket League   

Timescale – Gantt Chart Target markets Marketing mix 7P’s

Esports are video games that are played in a highly organized competitive environment. These games can range from popular, team-oriented multiplayer online battle arenas (MOBAs) to single player first person shooters, to survival battle royals, to virtual reconstructions of physical sports. Many esports events are live streamed online to viewers on the internet. The UK Esports economy has grown at an average of 8.5% between 2015 and 2019. The sector supported over 1,200 jobs in 2019. The UK Esports sector represents just under 8% of the global market. The UK Esports sector supported £111.5 million in Gross Value Added (GVA) in 2019. Esports is a competitive level gaming. It's teams of people playing games against each other at a professional level, regularly winning huge sums of money as prizes. These esports players are contracted to play for a variety of different organisations, much like a football or basketball player would be. These teams practice and compete on their respective game just as a footballer or other sportsperson would too. Depending on the game they play – from shooters such as Counter-Strike: Global Offensive and Call of Duty to the multitude of other genres like sports titles and battle royale games – there will be a number of tournaments and events each year with hundreds of thousands of dollars in prizes up for grabs, sometimes even entering the millions. Each competing esports organisation will often have a number of teams in their ranks across multiple games. One example is Fnatic; founded in 2004, at the time of writing they have teams on 10 different games including Fortnite, League of Legends, and PUBG Mobile. Other examples of top organisations include G2, Team SoloMid, Team Liquid, and so many more. Esports to reach 385 million viewers in 2017: According to Newzoo, an esports market research organization, in 2017, the audience of esports will reach a total of roughly 385 million people globally. Of this figure, 191 million are “esports enthusiasts” and 194 million are “occasional viewers.” The number of enthusiasts is projected to grow by 50% by 2020, totalling 286 million. Most fans are in Asia, North America, and Europe: In the past, people thought that the craze of competitive video gaming was primarily an Asian phenomenon, yet today only 51% of esports enthusiasts are in Asia. In fact, North America and Europe have taken a prominent place in the global esports and gaming ecosystem.

Fans are young digital natives: Research indicates that 65% of fans are between the ages of 1834, and, while the fan base does skew male, 38% of esports fans are women. Among American male millennials (age 21 to 35), Esports is just as popular as baseball or ice hockey, with 22% watching it. In North America, the most popular sport in the region, football, is only 2x as popular as esports among male millennials. For male viewers between the ages of 36 and 50, football is only 3x as popular. Strengths     

Competitive play Social gaming Team Play Becoming recognized Very big fan-base

Weaknesses    

Violence F2P underage play Number of updates Too much Alternative Games

Opportunities   

Job opportunities Trade Markets Way of thinking

The global esports market size was valued at USD 1.1 billion in 2019 and is expected to expand at a compound annual growth rate (CAGR) of 24.4% from 2020 to 2027. The increasing audience reach and engagement activities, formidable investments, rising live streaming of games, and increasing infrastructure for the league tournaments are key factors driving the market growth. The professionalization in the industry has created lucrative opportunities for game developers, gamers, influencers, and event organizers. Millennials are considering esports as a professional career owing to the increase in popularity of the gaming tournaments, impressive international prize pools, streaming revenues, and one-to-one sponsorships. Moreover, universities and colleges are starting a dedicated esports curriculum to develop skilled professionals. Though the actual rankings of the most popular Esports games change slightly month-to-month, the ten most watched games on dominant streaming site Twitch remain consistent (Table 1). As of right now, League of Legends remains the most-watched Esport in the world. It’s also worth noting, for those less familiar with Esports, that the most popular games are not traditional sports-related video games such as Madden or FIFA. Rather, the popular Esports genres include multiplayer online battle arenas (where a player controlling a single character in a team that must destroy the opposing team’s main building), real-time strategy (where a player builds an

army to gain dominance over a map), or first-person shooter games (where players take part in a firefight across a map).

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Strengths Esports is attracting a massive audience, and viewership is growing. The industry engaged 380 million fans in 2017 and is expected to grow to 590 million by 2020. At a global level esports has reached 88% of people aged 18–39 in some capacity. Esports is so pervasive because it is a global industry, with a universal appeal. It has robust fan engagement and engages younger audiences through technology in a way that we aren’t seeing in traditional sports, or any other content producer for that matter. The esports industry has had significant year-over-year growth (+38.2% in 2018 so far) and is just beginning to be tapped. Due to low barriers to entry, and the connections fans feel with their esports idols through social media (Twitch streaming, Twitter, etc.). This has drawn the attention of major sponsors, like Coca-Cola and Red Bull. These big-name brands see esports as the perfect opportunity to reach the traditionally inaccessible male aged 18–25 target market. Since esports have been launched into the public sphere, the industry is exploding, and its strengths will continue to propel the industry in the upcoming years.

Weaknesses With rapid growth comes limited infrastructure. There are many participants in gaming, but there has been little progress made in creating a development pathway or formalized training. This has led to a lack of education around professionalism amongst esports athletes. This has caused a serious backlash in different situations.

Industry regulations of oversight have also been slow to develop. Major issues that come from this lack of infrastructure concern travel, health and safety, and defined competitive seasons. There are also no regulations over the ownership of the numerous amounts of data the industry generates. This lack of regulation has even led to players not being paid. While esports has been exploding, there is still some hesitation outside the ecosystem about what esports even is. The lack of education has been a roadblock for some sponsors, parents, and the traditional sports industry. Cheating has also been a problem (just like in sports) that has emerged from the professionalization of the esports industry. The types of cheating include a player playing under another’s name to boost their ranking, through drivers/hard drives/internet access windows, using the crowd, drug usage and match fixing.

Opportunity Professionalism - Professionalism has just started being raised as an issue within the esports ecosystem. Players — win or lose — have just spent the majority of their career in front of a computer, and not in front of a crowd. Further, they may have even been rewarded for explosive and unprofessional behaviour while streaming by enthusiastic fans. Establishing training programs and education around their new status as role models, and clarity about the consequences for unprofessional behaviour is a huge opportunity for all the esports ecosystem. Structural & Efficiency Plays - By creating development pathways and structured esports programs in schools, participation will continue to grow. Having a larger participation base will increase the level of play and continue to enhance the fan experience across all esports. Already, training facilities are beginning to pop up to groom the younger generations for careers in esports. New Payment Operations - With a lack of infrastructure leading to some players not being compensated by their professional teams, players are always looking for new ways to monetize. These gamers also come from the most tech-savvy generation. 75% of gamers wish they could exchange their virtual goods in games for a digital currency (Engin is trying to fill this void). Esports betting could also lead to further monetization for esports players. Threats

Segmented Fanbase - As a result of a global fan base, it is difficult for sponsors to target specific markets. With sponsors unsure of how to get involved, or not seeing a return on the investment, they could turn down the opportunity to participate in the industry. There are also so many games that fall under the extremely broad ‘esports’ term creating a very segmented and spread-out fan base. This creates the potential for different esports to struggle if they are only popular in specific markets. Game Disruption - While some games, like League of Legends, have been around for a while, and seem to have cemented themselves as an esports staple, the industry is very volatile. As computer graphics and design continue to improve and new games are released (ie. Fortnite) any game can lose popularity at any time. This means esports players also need to be versatile, adapting to new games as well as specializing. Healthy Living Advocacy - Esports has a reputation for encouraging lazy health and fitness habits — eating poorly, sitting in a chair, staring at a computer screen for many consecutive hours (see South Park WoW episode). This is a PR problem for the industry and makes parents very nervous when their kids show interest in esports. For further insight into the Esports industry, and how it operates sign up and receive our full report! With Esports, brands can increase their awareness as well as rejuvenate and improve their image. To advertise effectively in this industry, however, they must consider the values and laws of Esports and their supporters. Advertisers must ensure that they respect them and offer authentic, strong communication and partnerships that appeal to this audience. Creativity and clarity are essential. As the Esports market continues to evolve and structure itself, it also offers brands more and more opportunities to better understand their target audience. Analytical tools such as New zoo, which focuses on the gaming market, are designed to help advertisers do exactly this. Usercentred advertising based on profile data also offers the opportunity to reach eSports fans in a targeted manner and address them with relevant messages. All this information and the growing number of tools available should be used by companies to better understand their target audience, to create more relevant and immersive communication with them and to make it more effective.

Political: Some governments, like those in China, have Government legislation banning certain games and limiting hours of internet cafés and such, reducing possible playing rates for esports games. Banning of loot boxes in certain countries (a political move) means games that haven't removed them cannot be played as esports there.

Economic: Rise in inflation and Bank of England interest rates could see games, including esports competitions, to reduce capacity due to lower sales revenue for the game developers. This is due to video games being seen as a luxury good and when consumers have lower disposable incomes, they would tend to avoid purchasing them due to this inherently steep price elasticity of demand. Social: Esports are 'social' events - anyone can come up with this. Technological: They are playing games on what is most likely a PC. Legal: Some governments, like those in China, have Government legislation banning certain games and limiting hours of internet cafés and such, reducing possible playing rates for esports games. Environmental: PC's and the e-waste generated is a large problem so consumers and more importantly in this case, sponsors, may favour purchasing from those manufacturers who use more sustainable methods in creating the PC components or sourcing from a supplier who uses less violent mining methods for the rarer metals in the CPU etc.

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