Esports, as a business opportunity, is becoming a more common approach for many companies. As the viewership numbers rise for tournaments, companies decide to show off their products and services.
What is a sponsorship?
What I have described above is essentially a sponsorship. It’s the act of giving financial support to a company in exchange for some kind of publicity or service. In esports, the companies that sponsor teams usually get their logo displayed on players’ jerseys. When the sponsorship is for a tournament, the company logo is displayed somewhere on the big screen.
In the beginning, companies that were somehow involved in the video game space offered esports sponsorships. These included hardware and software manufacturers, video game developers, publishers, and more. Over the past few years, however, this has changed, and brands with nothing to do with video games are now getting involved through sponsorships.
How have sponsorships changed esports?
Sponsorships have allowed for more teams and tournaments in esports. As more money flows into those venues from well-established brands, teams can afford to function and expand while tournament organizers can host more significant and more frequent tournaments. This influx of money has given more players the ability to make professional esports their career and has allowed more esports-focused companies like tournament organizers to flourish.
Of course, not everyone will be a fan of the general public coming into esports. In the beginning, esports was a very niche market, filled with only hardcore fans and sponsors. Some might see this as an invasion of their gaming space by people who are not loyal fans. Some people would likely prefer video games for the select few, and seeing a StateFarm logo on a League of Legends highlight is their worst nightmare.
The recent quarantine due to the worldwide pandemic has only increased the interest of mainstream media in esports. As traditional sports came to a halt, esports took the spotlight. The fact that the community has to come to terms with is that this expansion of esports into the public eye will only continue for the foreseeable future.
What are the long term risks of sponsorships?
With every sponsorship comes the risk that someone, somewhere will screw up. When Lance Armstrong admitted to doping in 2013, all of the brands associated with him were put in the same bad light as the cyclist himself.
If someone in esports releases too much branded content, it can double back to the feeling mentioned above that the content creator has sold out to that brand. The best bet is for those in esports sponsorships to be associated with multiple brands to minimize the risk of selling out as much as possible.
Esports sponsorships are a constant balancing act between all parties involved. One’s downfall can lead to the downfall of the others and vice versa. It’s a razor’s edge that requires a certain finesse to navigate.
How will sponsorships shape the future of esports?
As previously mentioned, interest in esports continues to grow, and more brands get involved all the time. A good example of a recent tournament with a whole grocery list of sponsors is Riot Games’ League of Legends Worlds 2020. Some of the sponsors include Mastercard, Mercedez-Benz, Intel, and KFC, among many others. What could go wrong with such a big list of well-established sponsors?
Well, there is always the fear of them taking over. When a brand has this many people with a stake in their tournament, how long will it be until those sponsors end up being the ones who make the decisions? If that doesn’t happen, how long will it be until the community loses interest in the tournament because of its branded content?
When Riot Games signed Mercedez-Benz as a sponsor, they announced a whole slew of promotional content in the works like “devoted commercials, promotional artwork, and digital content on social media.” Not every fan will like all the branded content, which might lead to a ripple effect in the community.
We’ll have to wait and see what time holds for esports and its many sponsors. While interest in esports is likely to increase, as we already mentioned, it remains to be seen how many sponsors hold that interest, how many will leave the scene, and how many new ones will come.