Competitive gaming, or esports, has long been a major source of entertainment for hardcore gamers and casual observers alike. From the era of Arcade gaming and home consoles like “Super Mario Bros,” “Quake,” and “Overwatch,” to online support for major leagues like “Overwatch” and the like, competitive gaming has continued on its upward trajectory.
However, the increasing popularity of competitive gaming has become so attractive that it has drawn a series of investments from a diverse range of key players in major industries. One of the significant investments into competitive gaming, according to Esports Insider, was the Microsoft acquisition of Activision Blizzard, one of the world’s best gaming companies, for $68.7 billion in 2023. So, why are companies investing heavily in competitive gaming? Let’s find out.
The Lucrative Competitive Gaming (Esports) Market
Competitive gaming has experienced a meteoric rise from an ordinary niche hobby to a global entertainment powerhouse. The appeal of competent gaming to a global audience emanates from various factors, most especially the social component aspect of the game.
The social component of competitive gaming, much like the following site https://slotozilla.com/in/free-spins with the best free spins casino bonuses in India 2024 contains, has bred an all-encompassing experience that has translated into a plethora of opportunities for commerce, pop culture, and mass media all around the world.
As of 2023, the competitive gaming (esports) market size was valued at 2 billion dollars and was expected to see a significant compound annual growth rate (CAGR) of about 15% by 2024. On the revenue generation side, competitive gaming worldwide is expected to hit $4.3 billion by 2024. In terms of the user base, competitive gaming is expected to have 856.5 million users by 2028.
Lastly, the user penetration, currently at 11.7%, is set to increase to 13.7% in 2028, according to Statista market insight. These are impressive numbers that dwarf those of traditional sports.
| Metric | Esports | Traditional Sports |
| Global Revenue | $1.6 billion (2023) | $750 billion (2023) |
| Viewership | Over 856 million active viewers | Billions of fans worldwide |
| Average Viewership per Event | Millions | Tens of thousands to hundreds of thousands |
| Age Demographics | Primarily 18-34 | Wider range, including families |
| Competitor Age | Typically 18-25 | Varies widely |
| Fan Engagement | High, often involving social media and online communities | Limited to in-person events and television |
| Growth Rate | Rapidly expanding | Slower |
Targeting a Demographically Valuable Audience
The underlying metrics of competitive gaming are so interesting that it has become difficult for companies to let go of them. This is because a large chunk of the user base is young, tech-savvy gamers who have become elusive to reach via any other digital channel.
According to a recent survey by GEEIQ on GenZ, an average young adult aged between 20 and 25 spends 107 minutes on TikTok compared to the 180 minutes they spend gaming on Roblox. This reality has made competitive gaming an irresistible choice for smart-thinking companies that are seeking to connect to a young and tech-savvy consumer base and enhance their brand identity for commercial gain.
So, most companies practice brand integration, where they incorporate their branded elements, such as logos, products, and, most commonly, virtual advertisements, into competitive gaming environments. This type of marketing campaign has proven to be a masterstroke for companies.
A good case study is that of Mastercard and betting sites that feature its sponsorship ads on Football Manager or unique in-game functionality that allows players to order Pizza Hut’s pizza through an in-game command on EverQuest II. Also, in recent years, there has been a collaboration between Nintendo’s Animal Crossing: New Horizon games and Hellman’s Canada, KFC, and IKEA through user-created content.
Building Brand Image and Engagement
Another reason companies invest in competitive gaming is the possibility of building brand image and enhancing their relativity with their target audience. The power of competitive gaming in shaping brand perception can not be overestimated. Gamers, most especially Roblox players, have expressed how much they resonate well with brands that associate themselves with esports. They see them as exciting, innovative, and having a sense of community.
So, to appear authentic and enhance their brand’s relatability, companies have invested heavily in competitive gaming via partnerships and other forms of collaboration. An example of a brand that has successfully integrated into the esports ecosystem is Louis Vuitton, which collaborated with League of Legends to release its first-of-its-kind LVxLOL clothing collection.
Another such collaboration with competitive gaming is that of Paris Saint Germain (PSG). In 2016, the French football club invested in esports through FIFA video games, the Dota 2 team in 2018, and most recently, the Indonesia-based esports organization Rex Regum Qeon. This streak of collaboration provides a unique way for brands to enhance the targeted demographic’s perception more than any other traditional marketing strategy would ever match.
A Surefire Tool for Competitive Advantage
The race to catch GenZ’s attention nowadays has become intense among brands, most especially in the aftermath of the pandemic. In the post-pandemic world, there has been a change in the business dynamics, with people pivoting towards virtual activations. This change in people’s preferences has brought all sorts of industries like automotive, banking, insurance, manufacturing, and others into the fold of the virtual world, leading to a more intense battle for the tech-savvy young demographic.
So, to stand out in this pool, sizable investment in competitive gaming marketing campaigns has proven to be a saving grace for many brands. Some of the ways companies leverage competitive gaming include.
- Sponsor a team by getting their company logo on uniforms in exchange for publicity;
- Partner with esports influencers across a variety of platforms;
- Launch dynamic ads that can only be seen by the viewers;
- Create an in-game ad that pops up at a predefined time in the game;
- Utilize the virtual billboards and sidelines in games to display your ads.
Conclusion
It’s indisputable that competitive gaming’s unprecedented growth in the past few years has made it an attractive industry for companies of all sizes looking forward to reaching their GenZ audience and building strong brand loyalty. Investment in competitive gaming is a win-win situation for all. The gaming ecosystem provides companies with large demographic data that allows them to tailor their marketing strategies to the right audience.
Also, positive brand perceptions are a good thing when companies invest in competitive gaming. Considering everything, companies’ investment in competitive gaming is highly justified and will become even more prevalent in years to come.
