The world of esports, has been evolving and attracting attention in pop culture since the turn of the millenium. Esports, as the name implies, is defined as electronic sports. They differ from traditional sports and sport leagues because the games are constantly changing, rather than set rules, each unique game poses new challenges, obstacles and intrigue. This variance in action and energy is what is making the concept of online sports so attractive to millenials.
Esports have two major viewing and engagement formats: live in-person tournaments and online events. Huge esport tournaments take place all of the world, where people come to compete in large arenas, just as in traditional sports. In 2013, the Staples Center hosted 13,000 fans to watch a South Korean team defeat a Chinese team in the championship final of League of Legends. This mass gathering of esports fans confirmed their popularity and influence. As watching sports online has continued to grow in popularity with more streamers, it has given esports fans more ways to watch their favorite players compete. Twitch, a online subscription service owned by Amazon, allows user to watch and stream digital video broadcasts. This gives fans a chance to interact directly with their favorite players in a way that traditional sports cannot offer. This is one of the reasons esports have grown in popularity among the 21-35 male demographic. And, with such an important demographic as a fan base, advertisers, now more than ever, are figuring out ways to deepen their understanding and presence in this market.
In most recent years, the only way to advertise with esports was through sponsorship, which actually accounts for 40% of esports’ profit growth. However, esports is weary to accept sponsorship from big companies who are only interested in short-term deals. Esports wants to make sure that the companies will support them for the long-haul. However, because esports, at this point, are largely unregulated, it can also be very difficult to convince companies to invest large sums of money.
With this combination of factors, Twitch has begun to move their focus toward programmatic. Digiday reported that an agency exec said that Twitch has been “asking for advertisers to commit to spend at least $50,000 per campaign in exchange for a certain number of impressions.” Twitch hit $1 billion in ad sales in 2018, so combining this substantial ad revenue stream alongside Amazon’s advertising platform, they have set themselves up to be a huge player to watch in the programmatic marketing space. As advertisers have realized that this is a great platform to reach 21-35 males, Twitch is pitching themselves as more than a online game streaming service.
In the next few month, it will be interesting to watch how esports continue to influence sports, advertising and programmatic markets. New platforms like Twitch and esports are great new programmatic opportunities for advertisers to jump on. Advertisers are always searching for new ways to target audiences and this niche is definitely an opportunity that media buyers can keep in their back pocket when setting strategies for 2019.