Newzoo, the key provider of market intelligence covering the global gaming sector, has reviewed its Esports revenue forecasts considering this year’s postponed and canceled Esports events. It is evident that almost no in-person attendance at Esports events will occur for the rest of the year, as COVID-19 continues to hinder large in-person gatherings. The drop in live audience numbers has naturally decreased the forecast for ticket sales, but there is also a splash-over effect on merchandise. After all, many fans purchase merchandise as impulse buys at physical tournaments, driven by event excitement and fanfare. Owing to the pandemic, Newzoo has revised its 2020 prediction for merchandise and tickets, deciding to reduce numbers from US$76.2 million to US$52.5 million.
It is worth noting that the Esports audience is not smaller (meaning there’s no decrease in demand) and the number of organizers is not fewer (so there’s no decrease in supply). Besides, this summer, in Europe and the U.S., viewership of League of Legends competitions, such as League of Legends European Championship (LEC) and League of Legends Championship Series (LCS), enjoyed increases between 16.7% and 30%, compared to spring’s competitions.
Nevertheless, restrictions on international play are a barrier to fully flourishing during lockdown. Many other top Esports games -including traditional interregional mainstays Dota 2 and CS:GO-struggled in the face of travel limitations.
About future perspectives, negative impact on consumer-brand online spending could hurt the growth of both sponsorship and media-rights revenues. Of course, because of this uncertainty, Newzoo will continue to monitor the Esports landscape in the context of this worldwide recession.