Big Brands Have Big Choices To Make As They Enter The Esports Arena

What do big brands like Nike, adidas, BMW and Mastercard all have in common? They each employ an individual like Allan Phang, who serves as the esports ambassador for arline AirAsia.

That comment was made by Newzoo Chief Executive Officer and Co-Founder Peter Warman as he kicked off the Esports Bar Miami conference during the morning of September 24. Warman’s point was that there are barely any major brands remaining that have yet to dedicate resources to figuring out their best strategy for getting involved in the esports industry.

A major challenge for these big brands is to position themselves between hardcore and more casual fans, with case-by-case studies becoming necessary depending on the games the brands choose to target. But there is one challenge that Warman says brands have finally been able to get beyond — wondering whether esports is a sport. He says that everyone is beginning to agree that it is, and they are now focusing about how to spend money and time in the space.

When it comes to money, Warman believes that there is an $80 billion per year opportunity with $40 billion in media rights alone. Further, Warman notes that esports is just one part of the streaming space, with only 11% of content on Twitch and YouTube Gaming classified as professional esports content.

The aforesaid streaming services, as well as social streaming platform Caffeine (which Twenty First Century Fox recently invested in at the tune of $100 million) could soon break lines and shift to focusing on traditional sports as well, similar to Facebook’s roughly $230 million deal to be the rights holder of Premier League games in Southeast Asia.

Spectator numbers in esports pale in comparison to the likes of the National Football League and National Basketball League, but brands are increasingly thinking long-term, see that growth will continue (particularly with media rights) and are investing money to become a part of esports. Warman says his company is currently advising many top brands that have yet to even dip their toes into the esports ecoystem.