Esports arena: How the esports industry is evolving to tackle the challenges of rapid growth

The esports industry has experienced remarkable growth over the past decade. What was once seen as a niche pastime has transformed into a multi-million-dollar industry, and there’s no sign of this growth slowing down; estimates suggest that the global esports market will reach a value of $1.9bn by 2022.

An astounding 496 million people watch esports online and in-person. This kind of growth obviously has huge benefits for the industry. However, it also presents some challenges. With esports fans spread across a number of platforms for viewing, such as YouTube, Twitch and team sites, it’s hard for industry professionals and teams to understand the growth and where it’s coming from. This also makes engaging fans and tracking their behaviour in a cohesive way across all channels extremely difficult. In particular it’s hard to understand and engage fans in order to monetise their behaviour, and this is especially a challenge for esports teams when it comes to the need to show ROI to sponsors they rely on.

In order to weather this growth, the esports industry is evolving. New innovations and solutions are being implemented to help keep fans engaged and to understand their behaviour. Growth is less helpful to esports if it cannot be understood, something these innovations are addressing.

Growing the sport on the ground

Something that teams and businesses can do to help engage their fans is to interact with them directly. Some countries, for example, have been opening esports gyms to continue generating interest in the sport and engage existing fans. These gyms – like T1 in Seoul and ‘Esports Gym’ in Tokyo – are sponsored by companies, giving these companies another chance to build their brands within the esports fan base. These gyms are a great way to help understand fan behaviour, as well as to continue to grow the industry. Equally, social media training for professional esports players can help players engage with their team’s fans at a direct level, building an understanding of fan social activity and building loyalty between them and their teams.

Fan loyalty platforms

One way that esports businesses can better understand and monetise fan behaviour is by creating reward platforms that incentivise supporters to interact with their teams, other fans and even team sponsors. On loyalty platforms, fans are incentivised to complete social actions – like interacting with their team – with exclusive rewards. These fan loyalty platforms, which use blockchain’s transparency to ensure accuracy of the metrics and insights gathered from fan interactions, engage fans and allow teams to learn more about their behaviour. Metrics gathered on these platforms can be shared with sponsors to further provide information on fan behaviour. Alternatively, incentivising interactions with sponsors as well as teams allows them to learn directly from fan behaviour, making the learnings extremely valuable. Reward platforms not only allow fans to feel more connected and loyal towards their teams, but also ensure that industry professionals are learning about fan behaviour, helping to further understand growth in the industry.

Digital collectibles

Esports teams can go further by creating digital collectibles, based on blockchain, to unlock a new revenue stream and engage fans. For example, esports teams could create digital trading cards of their players. Fans can buy exclusive digital collectibles from their team, providing the club with an extra stream of revenue. Due to their basis in blockchain, they cannot be destroyed, forged or replicated like physical collectibles can be, making them an exciting option for fans and teams alike. We’ve seen the success of these collectibles already, such as with the NBA’s ‘Top Shot’ or Zed’s digital racehorses. These collectibles also have the bonus of allowing fans to feel more connected to their team, allowing the esports industry to take advantage of it’s growth and engage their audience.

While esports will keep on growing, like all young industries it will level out eventually. In order to sustain growth, ensure a loyal fan base and a healthy pipeline of sponsors, teams need to explore new solutions. Digital collectibles, fan loyalty platforms and other innovative solutions like esports gyms, provide teams and brands with a range of ways to ensure that they are keeping close to fans to understand their behaviour, helping to secure further engagement and growth within esports for years to come.

Lars Rensing is CEO and co-founder of enterprise blockchain services provider Protokol. He has more than four years’ experience in the blockchain industry, helping to lead and co-found Ark; the open-source blockchain platform which underpins Protokol’s blockchain services. He is passionate about helping everyone from start-ups to enterprises unlock the opportunities of blockchain technology for their business, and as a result currently also serves as an adviser for a number of start-ups leveraging blockchain technology. He leads the overall strategy and direction for Protokol, which is helping businesses across the world solve real challenges though custom blockchain solutions.