Esports are serious events, with the possibility of serious payouts for CE retailers who know their audience. What are esports and can retailers provide the gear their customers are looking for?
The growing size and popularity of esports is undeniable. IDC predicts that esports will generate more than $2.2 billion in revenue from pro tournaments, leagues, business, betting and influencer marketing this year, up from about $1.7 billion in 2019.
But what are esports? Esports are the professionalization of playing competitive video games through official franchise leagues, major tournament circuits, and one-off special events/tournaments. While not exactly on the scale of the NFL, MLB, NBA, or NHL, the best esports team, TSM, is worth more than four Major League Soccer franchises.
How can consumer technology retailers capitalize on the lucrative pro-gaming market? “Esports players are definitely using premium hardware,” advises Lewis Ward, IDC’s director of gaming, esports and VR/AR research. “Of course, this means that as esports continues to grow globally, retailers have the opportunity to grab a slice of a growing associated spend pie for systems and accessories and beyond.”
Professional-level gaming gear is both highly desirable and pricey, which is good news for retailers. But what will drive these premium hardware sales? The short answer: expanding the belief that with the right gear, any gamer can become a rich and famous pro.
“Esports feels more accessible to the average gamer than traditional sports to the average person,” said Matthew Ungaro, director of esports, business solutions, at MSG Networks in New York. “As a result, average gamers like to spend money on top-of-the-line PCs and gaming peripherals — headsets, keyboards, mice — because it can give you a slight edge over your competition.”
More importantly, Ungaro points out, “all gamers, from the casual video game player to the hardcore professional esports athlete, buy their gear from a retailer so they can differentiate themselves as the primary channel customers go to for the top of the line. -line gaming products can go a long way in boosting business.”
Play like a pro
As with any professional sport, connecting gaming hardware that you also sell to “the pros” is a key marketing strategy according to industry observers.
“Retailers and manufacturers get positive results about their business when ‘professionals’ use their equipment in a competition,” explains Emily Herbert, a research associate with the North American team for Counterpoint. “Adding the word ‘pro’ now usually means that there are better specs than a base model, and that often comes with a higher price tag. Emphasizing why the specs are better and necessary for better gameplay is the most effective upsell.”
Influencers influence sales
Like any professional sport, “influencers” also help drive interest and sales, regardless of gender. While video gaming is usually portrayed as a high-testosterone activity, according to Statistica, 45% of games in 2021 were women, with actress Olivia Munn being the face of female gamers and Lori Bajorek president of the National Esports Association (NSA). Steph Curry, Mark Cuban, Drake, David Beckham, The Weeknd, Ashton Kutcher, Mike Tyson and Michael Jordan are among the many celebrities who have invested in esports.
“Some marketers have started to lean towards marketing gaming products as the crossover between sports stars/musicians and gaming,” Ungaro points out. “The general message of these types of campaigns is that ‘everyone is playing’ and the use of famous sports stars and musicians will help normalize gaming as a lifestyle and make it more palatable and understandable for the masses. Understanding the influencer’s importance in the gaming space can go a long way in connecting better with customers. Harnessing game influencers, for example someone who creates gaming-focused content on YouTube, Twitch or other platforms, is probably the most important way to market products in the gaming lifestyle space today.
“Influencers can be a marketing opportunity through sponsorship, an opportunity to resell merchandising, and can drive in-store sales of accessories, PC or console hardware, or games, depending on what they’re promoting or using on-stream,” Piers agrees. Harding-Rolls, research director of Ampere Games. “There is also an opportunity to do in-store personal events to increase footfall.”
In-store personal gaming events can be esports tournaments or the creation or sponsorship of local esports events. “Dedicated game and sports-related retailers in specific geographies/metro areas could start selling esports team merchandise that is local to them,” adds IDC’s Ward. “Some esports teams are generating significant revenue from merch on their websites, so maybe local retailers can step into this space and generate some cheddar.”
See also: Retail gaming: trends to watch
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