“Now, the major esports organizations out there are really media companies; we’re seeing this play out with some of these companies announcing that they’re going public and making acquisitions. M&A strategy is now core to most of the major teams that are out there,” said Ned Sherman, a partner at professional services firm Manatt, Phelps & Phillips. “If you think about it, their teams are only part of the equation, right? They have a content creation and production machine with influencers, some of which are professional esports players or gamers, and they have extensive reach on the major social platforms.” Teams are able to leverage this social reach as a valuable window into the gaming community for non-endemic brands. 

At the moment, esports organizations across the world are in the midst of transitioning from a focus on competition to a holding company model — all while shouting their love for competition from the rooftops to maintain brand legitimacy. 100 Thieves owner Matthew “Nadeshot” Haag has long been outspoken on Twitter about his belief in the importance of the competitive side of gaming, but his company has signaled its intentions to become more than just a competitive team through acquiring other companies such as the peripherals manufacturer Higround. In January, Envy Gaming acquired the operating contract of Esports Stadium Arlington, indicating its own plans to expand from an esports team to an operator of gaming and esports events.

For brands, there are clear benefits to working with esports organizations using this distributed model. Adrian Montgomery, CEO of esports company Enthusiast Gaming, describes his company as an “integrated business.” Enthusiast owns prominent esports teams such as Luminosity Gaming, but it also owns publications such as Upcomer and The Escapist, online communities like Games and live events such as the annual Enthusiast Gaming Live Expo.

This content distribution network gives Enthusiast a wide reach, Montgomery said — but, more importantly, it allows the company to track engagement and share those numbers with its brand partners. “Brands are getting more and more sophisticated and saying, ‘here’s the criteria that will deliver me a successful return on investment against my marketing spend, and you have to prove it to me.’ So if you’re the company that is aggregating audience data that can’t back that up, that’s not going to cut it for a Procter & Gamble; that’s not going to cut it for a Bacardi or a Coca-Cola,” Montgomery said. “So you …read more

Source:: Digiday

Author: Aaron