This is a guest contribution by Luke Cotton, Esports Specialist at Digital Fuel Marketing. If you would like to submit a contribution please contact Bill Beatty for submission details. Thank you.
Everybody has likely read that Esports is a $612m market, and that there are 134 million viewers of them worldwide. Most are probably aware that Amazon purchased leading livestreaming site Twitch for almost $1 billion and that YouTube is now trying to catch up with the launch of its dedicated gaming platform. But did you know that the first recognized Esports event saw the winner walk away with Quake programmer John Carmack’s Ferrari, or that video game publishers are now licensing out the rights to hold Esports events using their games? Today, many leading Esports players can actually make more revenue from live streaming or sticker sales than their salary and tournament winnings combined.
Did you know that up to $4.5m is wagered on CounterStrike: Global Offensive (CSGO) black markets per day, that the leading black market Dota 2 betting website has more Facebook fans than William Hill, Ladbrokes or bet365, and that League of Legends, widely recognized as the leading Esports title, sees less wagering than the relatively minor StarCraft II? And if so, do you really understand why this is the case?
Betting operators are likely to judge the potential of Esports as either new markets for their existing Sportsbook, or as Betway is, as a new product in its own right, based on their own early wagering and acquisition signs. So, understanding the Esports landscape, the intricacies of the various games, their different fans, and where to acquire customers is crucial for success. Without this understanding, bookmakers will be playing a dangerous game. They run the risk of seeing considerably different results to their competitors, who have a more complete understanding of the fundamentals, and who will therefore invest more resources to profit in the long term.
Here are some key themes to help you consider your approach in order to successfully build a customer base from Esports.
Understand that different games are different sports: Esports is an overarching concept.
The main misconception so far is that “Esports” are one and the same; they are not. Just as you segment and communicate differently with your soccer, horse racing and tennis customers, you should be doing the same with League of Legends, StarCraft II and CounterStrike. Esports enthusiasts don’t love each game equally. Just as sports fans have some sports they love, some they watch on occasion, and others they avoid, Esports fans are the same. Equally, the demographics of the people interested in each game also vary. This effects your marketing messaging and promotions: the fans differ between games, they can be accessed in different places, and have key differences in their attitudes, exposure to gambling so far, and current betting habits.
Your trading strategy and how your markets are displayed on site should also be modified accordingly. Some bookmakers ran acquisition campaigns around the recent The International, the largest Dota 2 event. Yet, in the few days post-event, none priced up any more minor matches that would have helped to retain any new customers. However, on black markets, there was a stream of fixtures that were seeing up to 40% of the total betting volumes of The International final. Bookmakers most likely thought that with other Esports markets available, they were in a position to retain customers, but they were missing a critical understanding of the mindset of a Dota bettor. Many websites currently amalgamate how fixtures are displayed, and with team names replicated across different games, this causes confusion for customers, who at first glance cannot tell which games betting is available for.
Bookmakers should also consider why they offer betting on the games that they do, i.e. why World of Tanks, but not Call of Duty? Different games have varying levels of potential for betting, both in terms of turnover and advertising possibilities. So, it’s vital that you use messaging that is appropriate for, and that resonates with the fans of each individual game.
Be aware of current Esports betting behaviour and how it affects customers’ tendencies and expectations
At this stage, the various different Esports have all seen very different levels of betting. Understanding how this effects the habits and expectations of customers will help you appreciate how they think, and therefore, how you should communicate with them and identify where the opportunities are to maximise turnover.
League of Legends, generally acknowledged as the premier world Esport, is one of the least developed in terms of wagering. It has seen only the third highest turnover for Pinnacle (reported by EGR Magazine), behind StarCraft II and Dota2, with a key reason being that no gambling advertising is permitted in by far the most significant competition, the LCS. When communicating with these customers there is a need to educate them to betting in general, rather than assuming that it is something they are doing already with a competitor.
On the other hand, the majority of CSGO and Dota 2 viewers will be aware of wagering, as huge sums are bet on black market tote pools using in-game skins. As such, CounterStrike bettors do not think in fractions or decimals, but in percentages, as this is how they are used to odds being displayed. The tote mechanism also means that those bettors are not used to betting on multiples, but will frequently back very short priced singles.
Knowledge of the various games will also assist in identifying other products your new customers may have a propensity to play, which will help determine what you can cross-sell most successfully to them. The case opening mechanic within CSGO & Dota2 mimics that of a slot machine, whilst real-time strategy or MOBA players would probably be more responsive to a more strategic game like blackjack.
Identify where the best opportunities are for acquiring new customers
There are plenty of opportunities for acquiring new customers who will be interested in betting on Esports markets; think about using these markets as an acquisition tool before cross-selling customers to other products. Whilst particular advertising outlets will vary by game, there are many common themes. Traditional channels, such as social media, provide opportunities for the precise targeting that is needed for campaigns to be successful, whilst display advertising segments can be built for particularly relevant websites or direct media buys.
Many operators are looking to Affiliates to test the waters, but this provides limited scope in the context of the overall market size, and paid search provides a greater opportunity to gain high-intent customers. One of the more exciting developments offered by Esports is the potential to open up video as a new advertising channel. Advertising on gaming focused streaming sites such as Twitch, or the new YouTube Gaming, provides a more specific audience than that previously offered by YouTube, and could make using video cost-effective as an acquisition tool, as well as for branding.
Ensure customers see you as truly understanding Esports
Ensure your creative is appealing and conveys the message that you are a bookmaker that understands Esports, and above all, avoid appearing like a company that is just looking to cash in on a hot topic. Like many Internet communities, Esports fans are very savvy; while they will embrace companies who help their industry grow, they won’t hesitate to speak out against one if they think it doesn’t understand their passion, or is just trying to take advantage of them.
If your advertising for the opening weekend of the Premier League was focused on Everton vs Watford rather than Manchester United vs Tottenham, your customers would have been confused. In the same way, they would be puzzled if you ran El Clasico creative without Ronaldo and Messi. Yet, this is what some bookmakers have done so far with their Esports pricing and promotions. The recent ESL One event was priced up by some bookmakers. However, once it reached the latter stages, some bookmakers did not offer prices on the final. Any customer looking to wager a bet on the final would have been turned away to a competitor. Always ensure you know what the important Esport matches are, who the key players are and what type of images will resonate with your audience.
There are a plethora of specific acquisition and retention promotions that can be run with great success, but offering standard accumulator bonuses is unlikely to be attractive when frequently there are only a couple of stand-out games each evening. Remember, Esports are unlike traditional sporting events where there are multiple high calibre matches played on the same day. Instead, think about running a promotion such as “Money Back if Faker gets First Blood” for a game of League of Legends involving the team, SK Telecom T1. In a market where there is little price differentiation, tailored promotions provide an opportunity to distinguish your brand.
Luke Cotton has 10 years of experience in electronic sports, including managing leading professional gaming teams and running the UK franchise of ESL, Europe’s largest Esports website. He is the Esports Specialist at Digital Fuel Marketing, a leading digital marketing agency specialising in online gaming and betting.