The role of esports in the future of sports betting
It might not be the revolution some announced, and it is going to take time, but I’m convinced in the future growth of esports.
We probably need to admit that the first attempt of the industry might have been too early and clumsy. Sportradar already had an esports product when I was working there six years ago. The problem is that coverage was limited and, in retrospect, too expensive for what it was. Operators were frustrated with the performance as they failed to generate revenues and/or attract new players. The message became: “We have tried, it doesn’t work, esports is a fad”. And it didn’t get traction for years.
In the meantime, the audience of esports grew exponentially and the Covid pandemic brought the topic back in the industry because there were basically no traditional sports. There was a strong need for alternatives and esports became a no-brainer. With improvement from vendors and better coverage, the industry is on the right track to satisfying the appetite of esports customers.
So that is the first thing: it has evolved positively and we’ve come a long way. But there are still a lot of sceptical people! And certainly, there is more educating to do about esports.
Understandably, many people have a hard time considering it as a sport in the traditional sense. But when you see the work that goes into becoming a professional player, the recent influx of sponsorship and endorsements for esports athletes, the packed arenas to watch finals of big competitions, it’s no different to any other ‘classical’ sport.
I personally had a hard time understanding why someone would connect to Twitch streams to watch others playing video games when I thought the fun part was to actually play the game itself… Yet I am a rugby fan overly engaged watching France on TV playing the Six Nations… When you think about it, it is the same thrill but a content we - as an older generation - might have a hard time grasping.
When you break this psychological barrier and start seeing esports as a legitimate form of entertainment, you see the importance for sportsbook operators to position themselves as soon as possible because the foundation and the growth is there, it’s just a matter of time.
Is there an increasing demand for esports? Absolutely! Is there a wide market for it? Definitely! It’s not just for younger demographics, it is developing as a mass product.
How can operators address the challenges of cross-selling esports to their existing player base? Have you tried to explain TikTok to someone who is 60+ years old?
Joke aside, I am not convinced that the average sportsbook customer has much comprehension of League of Legends or DOTA2. It would take a lot of convincing to attract these players towards esports. As it is becoming a more global phenomenon, there will mechanically be more traction and a residual growth, but the truth is that if you have not been growing with it, it will be hard to embrace it.
You can always put efforts into gamification or education of course. And you already see some cross-sell with competitions like FIFA or NBA2K due to their closeness to traditional sports, but the truth is that the biggest esports are not sport based.
You are eventually dealing with a crowd that is exponentially growing and wants to get a share of their attention and purchasing power, and I think the focus should be on acquiring these customers and keeping them growing, even if it is not going to be through every vertical.
The key to me is creating a unique space for it to thrive, and not just offer it as yet another sport somewhere in your left navigation menu. I’ve always believed in the need to create a completely different universe, separated from the classic sport offer, with a different display, integration of Twitch, chat functionalities, dedicated stats etc. I think esports fans are much more responsive to operators that have created that special feel around esports. For operators who do it right, esports is already representing around 5% of their turnover. There is business in esports on its own!