Epicsports: How esports companies makes money
Epic sports: How esports companies make money
Introduction
How can an esports company make money? With such short rounds, how do spectators keep watching? And how do these companies get their name out there in the first place? These are just some of the questions answered in this article on how esports companies make money. We’ll give you the breakdown on where they get their income and how they invest it, too. Then we’ll show you what some of the top-tier companies have done to gain popularity, so you can follow in their footsteps and make your own esports company thrive!
Sponsorship
An esport company’s biggest revenue source is sponsorship. Big brands are interested in reaching the valuable 18-34 demographic that spends a lot of time playing and watching games.To capitalize on this, esport organizations have teams that compete in various tournaments. The most successful team will don a number of sponsors on their uniforms or during live streams of their matches. For example, one popular team from the Overwatch League has sponsorships with T-Mobile, Sour Patch Kids, Intel Corporation, Hewlett Packard Enterprise (HPE), Toyota Motor North America (TMNA), Twitch Interactive Inc., Chipotle Mexican Grill, State Farm Insurance Company, Honda Motor Co., Ltd., Coca-Cola Company and Activision Blizzard. In total, they are worth $12 million USD.
Advertising
As the popularity of esports grows, so does
the amount of money that organizations are willing to invest in advertising.
After all, what better way to reach the young, tech-savvy demographic that
makes up the majority of esports fans? With a global audience of over 200
million people, it’s safe to say that advertisers would be foolish not to tap
into this market. Plus, it doesn’t hurt that major brands like Coca-Cola and
Red Bull have invested millions into the industry in recent years.
Player/team Ownership
Like traditional sports, a big part of the
esports industry is a player and team ownership. Ownership in esports comes in
a few different forms. The first and most common form is through investors who
will buy into a team or organization and help finance it. These investors are
usually individuals or businesses that see potential in the team or players and
want to help them succeed. Another way that ownership can come about is through
sponsorship deals. In these cases, a company will agree to sponsor a team or
player in exchange for advertising rights. This can be in the form of branding
on the team’s jerseys or having their logo prominently displayed at events. The
final way that ownership can come about is through winnings.