Esports Sponsorship - time to advance to the next level?

Despite recent setbacks, however, esports continues to be on a strong growth trajectory – with GlobalData forecasting the sector will grow from US$1.6bn in 2023 to US$4.8bn by 2030.

And sponsors are expected to be a key factor in that growth. Far from fleeing the esports arena, the likes of Red Bull, Intel, Coca Cola, Microsoft, Mobile 1 and Mountain Dew still have significant skin in the game. Gillette, HSBC, Mastercard, McDonalds and Sky are just a few of the brands to have signed new partnerships in the second half of 2023 (underlining the point that esports is not just for endemic and snack sector sponsors).

An objective assessment of the situation is that esports could never really hope to keep up the pace of growth it demonstrated in the years just prior to Covid-19. Just like every other emerging sector, it was due a period of retrenchment – so that stakeholders could evaluate what works and what doesn’t. As such, it’s not really that different to what social media platforms and subscription-based streamers have been through recently.

The fact remains that esports (and the wider gaming sector) remains a golden opportunity for sponsors – as long as they have a clear rationale for getting into the sector, and can get their tone of voice right. Here are a few reasons not to call ‘game over’ on esports.

Large, youthful demographic: By 2025, there are expected to be over 318 million esports enthusiasts worldwide, up from 215.2m in 2020 (Statista). Additionally, 322.7m people are forecast to be occasional viewers of esports by 2025. In addition to reach, the audience is young. Agency Infront says that: “More than six in every ten internet users watching esports are aged between 16 and 35 years old. The average age of traditional sports fan is about 50 – it’s 26 for esports.” Esports is sometimes criticised for being predominantly male (something it is keen to redress), but for brands that want to reach a young male demo that’s presumably a positive. Gillette, for example, has established a significant presence in the Fortnite universe through its creation of The Gillette Cup.

Huge range of options: Esports is a catchall term that encompasses a massive variety of potential partnership opportunities. There are difference games, different competition formats and multiple potential entry points (leagues, teams, individuals, venues, events, media partners, etc). Put simply, choosing an “esports sponsorship” is a bit like choosing a “sports sponsorship” – which explains why the current roster of esports sponsors ranges from Disney to the US Air Force. Samsung is one brand that has run the gamut – sponsoring everything from teams (Tribe Gaming, Guild Esports) to events, festivals and platforms (the Intel Extreme Masters, Major League Gaming, DreamHack and Twitch-owned Rivals). Not all brands can match Samsung’s spending power, but the nature of the esports sector means there are also relatively low cost entry points.

Geographic spread: China and North America are the world’s largest esports markets – but the sector is global in its appeal, offering brands a rare opportunity to build a programme of activities that taps into multiple markets. KFC, already active in China and English-speaking esports markets, has just signed a three-year partnership with the Saudi Esports Federation. Encouragingly, this agreement will support women’s esports initiatives. Elsewhere, McDonalds and Head & Shoulders have just been named as partners of The Mobile Legends: Bang Bang Professional League in Singapore. Meanwhile, automotive giant Stellantis is working with esports organisation Giants Gaming on the launch of the new Opel Corsa Electric in Spain.

Opportunities for collaboration: Because esports is relatively young as a sector, it is still evolving and expanding. For sponsors, this means there is a lot of scope to get in at the ground floor of emerging franchises – or to co-create. In one recent innovation, furniture manufacturer Herman Miller linked up with esports organisation G2 Esports to create a custom-branded gaming chair. This is just one example of how the esports peripherals market has opened up opportunities for brands. Like sport, the dynamic, personality-led nature of esports also creates scope for branded content – with the added bonus that the audience are digital natives who understand social media implicitly. Just consider this multi-tiered partnership between Gen.G and Crocs, for example.

Links to established sports: The traditional sports sector has recognised that esports is both a threat and an opportunity. The downside risk is that esports will take fans away from sport. But the big positive is that it offers a new way for sports to engage with youth audiences. That’s why so many leading sports organisations and federations have actively engaged with esports in recent years. Formula 1, FIFA and leading football clubs are just a few high-profile examples, though most sports have explored how to integrate esports into their activities. One interesting recent development is the IOC's announcement that it is looking at the creation of an Olympic Esports Games. Activities such as these mean that sponsors have an opportunity to unlock the power of esports and sports in tandem.

Burgeoning track record: True, some esports sponsorships haven’t worked out. But that’s the nature of new platforms. The good news is that every passing year provides more case studies illustrating how brands can create authentic partnerships that deliver results. Last year, for example, the UK Sponsorship Awards showcased two highly effective esports sponsorships among its finalists: DHL’s partnership with ESL, entered by DHL, Bright Partnerships and Adrivo; and Excel Esports’s partnership with EE. The latter partnership positioned EE as a leading network provider within gaming and esports and played a critical role in a new era for the British organisation. The fact that a growing number of leading brands like Sky are returning to esports year after year is a sign that the industry is building a robust framework that will take sponsorship to the next level.

Interested in entering the 30^th UK Sponsorship Awards? The 2024 edition of this prestigious annual event is open for entries until January 23rd, 2024. There is a dedicated category for Gaming and Esports Sponsorship campaigns. For more details on the awards event and how to enter this category, visit the official UKSA website.