3 Misleading Expectations about the Esports Market
/2 years ago when I told business people or higher ed administrators that I worked in esports, the most common reaction I would receive would be something along the lines of “Oh, what’s esports?” As a tournament organizer, broadcaster, team owner, or game developer who is looking to get investment in their esports venture, this is a terribly discouraging start to a fundraising discussion. You’re not going to get very far into sponsorship talks when you have to start off with defining the very industry you operate in.
Lately, this conversation has begun going very differently for me. Now, when the uninitiated hear any mention “esports” oftentimes their reaction is something along the lines of “Oh I hear that’s all the rage.” It’s been really exciting and as someone who has spent the last 5 years seeking esports investment it’s a huge relief. But while it’s great that esports hype is more common among non-endemic actors near the space, there’s an incredibly troubling prevalence of misconceptions about the nature of the esports market that I find inform this hype. Anyone who has worked in esports for a good amount of time knows that overblown expectations have a history of making the esports market incredibly unstable.
So in an effort to help those interested in getting a more well-informed understanding of esports trends, I’d like to explain 3 of the major misconceptions that are over blowing a lot of the esports hype.
3 Misleading Esports Expectations
1. Esports is an individual Sport like Baseball or American Football
Is Tom Brady a sports player or is he a football player? Was John Wooden a sports coach or was he a basketball coach? You rarely hear either referred to with the “sports” umbrella because it covers such a vast swathe of sports games that one could be participating in. Yet for some reason researchers and the mainstream media have this awful habit of comparing the vast swathe of esports games to one sports game. This is an extremely misleading false equivalency. Maybe it’s because there are so many video games and none of them really make sense to those who don’t play them and so it is easier to think of their category as one sport. It could also be in an effort to make the esports industry seem like it’s on an even playing field to sports before that’s actually the case which I’ll get into later on. The point is this:"
“Football is to Sports as Fortnite is to Esports"
In esports, the individual video games have their own individual audiences just as each individual sport has it’s own audience. So based on this graph here from Satista, the takeaway bad actors will try to sell is that: By 2021 Esports will have more viewers in the US than Hockey, Baseball, Basketball, and Soccer. But the more accurate way to describe the information from this graph is: By 2021 you would need to have exposure with the US audiences from almost every individual esport combined in order to get the market visibility you could get from a single major sport.
So what’s the reality? In order to find it, you’d have to break down esports viewership to an individual esport in order to have a fair comparison. This article from CNBC proclaims that the 2018 League of Legends World Final had almost 100 million unique viewers which outdid the 2018 Superbowl viewership numbers, which were around 98 million. So it would seem like this one particular esports game (League of Legends) is outdoing this one particular sports game (football) in viewership for it’s ultimate competition. I wish that were true, but unfortunately this brings us to our next major misconception:
2. Esports Broadcasts Average About as Many Viewers as Conventional Sports.
Nielsen verifies that the average US viewership for the 2018 Superbowl on CBS was 98 million (not including online and non-English broadcasts which adds several million additional viewers.) However, if we take a look at stats from Esports Charts we can see that the 2018 League of Legends Worlds event had over 200 million viewers. That’s almost double the viewership of the Super Bowl right? Not quite. The average Superbowl viewers and the peak LoL Worlds viewers are two entirely different measures.
We can see that the average concurrent viewers (CCV) for Worlds was actually closer to 47 million, almost half of average Superbowl viewers. In the interest of fairness, it’s important to note that the air time for Worlds was over 130 hours of content. To average 47 million viewers over 130 hours is just as impressive as average 98 million viewers for the few hours of the Superbowl. So there’s still just as sizable of a US audience for League of Legends as there is for the Superbowl, right? Not quite. It’s time for misconception Number 3.
3. The US Esports Audience Rivals the Audience for Conventional Sports.
Just like it’s important to notice the distinction between average viewers and peak viewers, it’s just as important to notice the difference Chinese viewers vs US viewers. While there were 98 million average US viewers for the Superbowl, we can see that the 47 million average Worlds viewers includes many more regional audiences than just the US audience. While there is no available information about the US audience alone, we can see from the Esports Charts webpage, that once you remove Chinese viewership alone, the count drops from 47 million to 600,000 average viewers, That’s a 98% smaller audience! Still counting all other regions except China!
Why Overhyping & Poor Quality Mainstream Reporting On Esports is Bad For Everyone
This deep dive we took into some shoddy reporting from a reputable business news organization like CNBC is just one example of a much larger problem across mainstream news outlets. The reality is that everyone who has a financial stake in esports has a vested interest in convincing the public that esports is an entertainment industry monolith. At the same time, journalists seeking to publish big headlines have a vested interest in reporting that the esports industry’s growth is a monolithic trend. Both parties worst nature’s are only encouraged by the fact that esports are incredibly complex and hard to completely understand as an outsider. The result is traditional sports owners such as The Kraft Group, Miami Heat, and aXiomatic spending $20 million on an esports franchise slot and expecting a ROI that esports can’t provide. This is terrible for the industry long term and will stagnate esports’ adoption into the mainstream. While the team owners, league organizers, and games studios have made a big profit in the immediate present, reality is fast approaching and with ROI falling flat investment could leave the esports industry just as quickly as it arrived; setting the industry’s growth back 5-10 years.
My ultimate goal is to help establish esports as a cultural staple that’s as commonplace as backyard baseball across America. That’s why I feel that it’s important these misconceptions are dispelled so that clients who are willing to take the leap into esports business can make well-informed investments that provide sustainable growth that encourages steadily increasing involvement.