Publishers too are struggling to recoup their investment in esports. Riot Games head of esports Chris Greely told WIRED that Riot is “approaching breakeven” on its esports endeavors. And in an earnings document revealed during its trial against Apple last week, Epic Games said it overestimated its opportunities in esports by $154 million in 2019—the year it ran its $30 million cash-prize Fortnite World Cup.
Greeley says that esports is not some stretched-out bubble ready to burst. However, he says, “I think you’re going to see a bunch of folks who are pivoting or shifting direction or shifting strategy to continue to move forward, the way any startup industry tends to do.”
Esports organizations typically associated with tournaments are now signing more deals with content creators. (Several top teams declined to comment on this over email.) Instead of competing as part of an Apex Legends or Counter-Strike: Global Offensive roster, these gaming influencers stream on Twitch or YouTube, sometimes just chatting with fans and sometimes playing games at a high level. As part of their partnership agreements, teams help manage these gamers’ businesses, facilitate sponsorship deals, and even provide salaries.
Fielding a roster of YouTube or Twitch celebrities can help teams attract more sponsorship deals, which still make up a significant part of their bottom line. Influencers tend to have larger and more engaged audiences than individual athletes, entire teams, and even whole tournaments. A Call of Duty League tournament might get 70,000 gamers to tune in, but a top streamer like Timothy “TimTheTatMan” Betar approximates that on any given day. For brands weighing where to put their money, those kinds of metrics make the choice easy.
“It’s all about return on investment,” says Corsair CEO Andy Paul. “What we’ve seen with esports so far is that there’s not clear winners. There’s still a lot of churn.” Corsair’s marketing budget has gone up recently, and Paul says his team has been dedicating a higher percentage of it to influencers relative to esports teams. It represents a shift in Corsair’s sponsorship strategy from esports to content creation. Content creators are more charismatic, easier to identify with. “Once you get an emotional connection with somebody, you’re going to trust them when they say, ‘I’ve been checking out this microphone, and it really sounds good.’” If a streamer is on camera for eight hours using a Corsair keyboard, that’s a lot of exposure for the company. Under the stream, there is an affiliate link. At an esports tournament, meanwhile, it is more challenging for companies like Corsair to measure how many times the camera flicks over to a sponsored player’s headset.
Publishers—for whom esports is, at base, a marketing exercise—also have a lot to gain from an industry trend toward gaming celebrities. Both Fortnite publisher Epic Games and Riot, with its new shooter Valorant, are taking a more influencer-focused approach to esports. Fortnite’s 2020 Creator Cup gave viewers prizes for rooting for and watching their Twitch streamer of choice. Its Icon Series brought IRL celebrities like Travis Scott and Marshmello to compete. For Valorant, which does not yet have a franchised league, Riot Games is supporting third-party tournaments for both content creators and esports stars. The publisher is also hosting watch parties, with top streamers like Tyler “Ninja” Blevins and Michael “Shroud” Grzesiek airing tournaments on their own streams and watching along with their fans (and sometimes earning more viewers than Riot’s own channel). Riot has several times chosen top streamers over esports pros as co-streamers.
“Folks on the content-creator side are bringing audiences that might not otherwise watch Valorant,” says Greeley.
For esports athletes, the shift comes with some risks. While influencers may help esports attract more sponsorships and viewers, some teams are dropping their rosters entirely for popular games while their bench of content creators balloons. And not every pro gamer who wants to can make their own switch to streaming, the way Håkansson did a few years ago. Succeeding on Twitch or YouTube takes more than some skill headshotting opponents. You need a certain charisma to retain audiences livestreaming when there are so many other options available. “They’re simply just like different careers, even though fundamentally both are still playing video games,” says UTA’s Lau.