The Rise of eSports

Since the advent and growth of eSports giants like Dota 2 and League of Legends, the gaming community has called for mainstream recognition regarding legitimacy. Take Colin Cowherd’s 2015 rant against esports for example. There are undeniable similarities between professional gaming and conventional sports, but the arguments have generally been ineffective in dispelling traditional beliefs formed by the collective generations of sports fans prior. While it is easy to dismiss playing video games as anything resembling an athletic endeavor, it is more complex than just noting the relative lack of physicality and declaring  as non-sports.

At their very essence,  are video games played in a competitive environment. Sometimes the games can be played one-on-one, other times, teams will square off against each other. But the key point in all of this is that  are competitive events. They are all about opposing players or teams doing battle in a real-time competition.

What’s In A Name? The traditional definition of professional sport is: all forms of competitive physical activity which, through organized participation, aim to provide entertainment to spectators and provide an income for the athletes, who in turn devote time training to increase their skills and experience to modern levels of achievement. But physicality alone cannot be the mark by which we measure “sport”. After all, look at poker. Poker is frequently broadcast on ESPN and other networks. This is equally true for chess and the National Spelling Bee. Is there anything remotely physical about playing poker? Or chess? Or a spelling bee? No.

And yet, all of these events are considered sporting events by probably the most recognizable sports network on the planet. Furthermore, players of  employ a strategies that play to their strengths while exploiting the weaknesses of their opponents. If the game being played is a team-based game, then teamwork is essential. Like any other athlete, players have tremendous reflexes, dexterity, and problem-solving skills. So, what exactly accounts for how we define “sports” and what does it mean for marketers?

The Conceptual Breakdown. Judging another culture solely by the values and standards of one’s own culture is termed ethnocentrism. People born into or surrounded by a particular culture begin absorbing its values and behaviors and build a worldview centered around these principles as the norm. Within the context of , this concept explains the psychology behind a lot of mainstream dismissal. Quite simply  don’t fit easily into our cultural definition of what sports should be. We do the same thing with other cultural categories all the time. For example, people in the U.S. struggle to classify crickets as food even though they are healthy, tasty, and plentiful. So, the struggle, whether it’s crickets or esports, is a reflection of cultural norms.

While ethnocentrism lends to maintaining the cultural status quo, generational gap is a concept referring to the differences between people of younger generations and their elders. It is the conflict between these groups which has catalyzed a lot of recent cultural change. This allows for members of the younger generation to form their own identities and cultures outside of older and mainstream influences. This is important to the development of  because despite its young age, its rapid growth foreshadows a change in the mainstream attitude towards it. The younger generation is growing up participating in and watching , thus making them part of their cultural norm. Within the next five years, there will be enough members in the community to challenge the mainstream dismissal of  and even gain the respect of the older generation regarding its legitimacy. And that should have everyone involved in marketing thinking.

Going Mainstream. Regardless of how you view , they are growing in popularity every year by leaps and bounds. Esports are on the verge of breaking out of their niche communities into mainstream focus. According to Newzoo, a company specializing in esports analytics, it’s estimated that the global esports economy will grow by 41% by the end of this year to $696 million and reach $1.49 billion by 2020. Keep in mind that includes more than the game itself, it includes media rights, advertising, sponsorships, merchandising and ticket sale. Like any other sport, it means reach extends well beyond the game.

The numbers speak for themselves, but also consider this: The renowned IMG Academy, an elite boarding school and training program in Florida geared for athletes in basketball, football, and other traditional sports, recently added an esports training program that includes physical, mental, and nutritional aspects. In other words, one of the most successful and prestigious sports-focused schools in the country believes so much in the future of esports that they have developed a training program around it. The outcome of generational gap is something IMG has identified and they are betting on significant changes in how we think of sports as a society.

Legitimacy also continues to be added as traditional sports team owners such as New England Patriots owner Robert Kraft and the organization that runs the New York Mets, Sterling Equities, have begun to make multi-million dollar investments in esports leagues. Cities like Washington D.C. have even outfitted their professional basketball arenas for live esports taking a well-calculated gamble that esports are here to stay.

That growth and investment around esports has started catching the eye of big-name brands including Arby’s, Coca-Cola, Audi, and Gillette to name a few. That’s because they see an opportunity to reach a demographic sweet spot, namely males between the ages of 21 to 35. They have cash, they’ve grown up gaming, and they are increasingly hard to reach via traditional advertising. Newzoo estimates the current global  audience at 385 million people, including 191 million enthusiasts and 194 million occasional viewers.

It’s estimated that the global eSports economy will grow by 41% by the end of this year to $696 million and reach $1.49 billion by 2020. Keep in mind that includes more than the game itself, it includes media rights, advertising, sponsorships, merchandising and ticket sale. Like any other sport, it means reach extends well beyond the game.

The numbers speak for themselves, but also consider this: The renowned IMG Academy, an elite boarding school and training program in Florida geared for athletes in basketball, football, and other traditional sports, recently added an esports training program that includes physical, mental, and nutritional aspects. In other words, one of the most successful and prestigious sports-focused schools in the country believes so much in the future of esports that they have developed a training program around it. The outcome of generational gap is something IMG has identified and they are betting on significant changes in how we think of sports as a society.

Spending by eSports still falls decidedly short of traditional sports. Enthusiasts will spend an average of $3.64 per person following the sport this year, according to Newzoo. Compared against basketball, on which fans spend an average of $15 each, and the short-term gains aren’t there for many brands. But like all things with esports, the numbers don’t tell the whole story. One reason for the discrepancy is that esports content is largely available for free and the money spent on merchandise remains relatively small. But spending is rising and expected to reach $5.20 per fan by 2020. Another reason is that eSports are drawing a younger crowd with less disposable income – for now. And this is where thinking about the long game becomes important. Building brand affinity and share of culture means building connections that last a lifetime. The earlier you bring a population into the fold, the sooner you become essential to the deeper cultural conversation. You aren’t reacting, you’re creating.

In the end, it doesn’t matter if eSports are seen as sports. People in the industry can identify similarities and use conventional sports as an example to adapt and grow the eSports culture. Growth in target audience involvement is currently more important than acceptance of members outside the base. And for brands hoping to remain relevant, having a presence in the eSports environment is extremely important.

 

 

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AI, Advertising, and Culture

In an ever-increasingly connected world, artificial intelligence is beginning to find its way into every aspect of our lives. We are “on” 24/7and we rely more and more on our  devices, particularly our mobile devices, to help us make decisions. That rapid increase in computing power has done more than help the user. It has equipped companies with an unprecedented capacity to automate processes that previously required hours, days, and weeks of human effort. AI has allowed companies to target, adjust, and adapt at an unimaginable pace. In the same way that Siri acts as a personal assistant for its users, marketing companies are now tapping into AI to act as a personal assistant in the creation of highly effective marketing campaigns.

Currently, agencies (and their clients) use AI to sort Machine-Learning-AI-in-Finance-11-04-2016-A-1200x1200.jpg
through assets to determine and/or refine the target audience, to gather data about how to best position a brand in various contexts, and to create varied advertisements intended for a wide variety of mediums, including everything from billboards to social media. The final piece is still largely in its infancy, but will no doubt continue to grow and evolve as AI become faster and smarter. Today, the goal of AI in advertising is to optimize campaigns by placing ads in front of the right customer at the right time. As technologies evolve, advertisers will be able to limit their ads on the basis of a huge array of parameters, most of which we’re all familiar with. Targeting an individual will be based on hundreds of parameters and actions, all quantified and measure in the blink of an eye. And creative (and its placement) will adapt in near real-time. In other words, they’ll be able to micro-target at a faster pace than we can imagine.

All of that makes sense, but humans are more than individuals, we are part of broader cultural systems, which means context and cultural cues matter. Yes, each customer is unique and therefore each customer journey is unique. However, there are broader social, symbolic, and cultural forces that guide our behavior depending on the situation at hand. So, the question is, can AI account for those cultural patterns and processes?

Considering the rapid developments in machine and deep learning, these systems will become increasingly capable of teaching themselves to make more precise and effective decisions based on a broader set of inputs. Ultimately this means that for AI to be truly move beyond transactional relevance, it will need to have a more balanced approach, which is to have a robust understanding of people’s aspirations, interactions with each other, and social connections. What are they trying to get done, what are the barriers to that, how do they create a sense of belonging, etc.?

We create culture, interact with it, are affected by it, and can even be destroyed by it. Culture applies its own logic, has a memory, endures after its makers are gone, can be repurposed in supple ways, and can induce action. Because culture can do things we cannot do as individuals, like fostering collective action or making life easier by providing unspoken assumptions on which we can base our lives, AI will need to evolve to do more than react to clicks.