Esports odds and trading solutions provider RTSmunity has launched ‘Esports in the Spotlight’, an analysis that takes into account the size of the Esports betting market (divided by continents), the core Esports consumers and how to approach them, as well as makes some growth forecasts. This document has contributions from companies H2 Gambling Capital, Parimatch and STS.
SOME KEY INDICATORS
Esports are an increasing phenomenon. In 2019, they reached an audience of 500 million people, generating over US$1 billion in revenue. Now, at the end of 2020, those numbers have expanded because of the global lockdown due to COVID-19. According to research firm H2 Gambling Capital, Esports will grow its share of global betting GGR over the next five years from 1.6% (2019) to 3.2% (2024). Besides, total sum of bets placed on Esports during 2020 is expected to be US$14 billion.
In Europe, the Esports fan base is the second biggest in the world, right after Asia, with 92 million fans, growing by 7.4% YoY. Regarding betting, the European Esports market accounts for 44.5% of the global Esports betting market, with US$152 million in betting turnover. European Esports scene is dominated by League of Legends (LoL) and Counter Strike: Global Offensive, with Dota 2 close in terms of fans and popularity. From a betting perspective, the clear number 1 title is CS:GO.
About this discipline, Pavol Krasnovský, CEO, RTSmunity, explained: “Esports as a business is a very dynamic area, and the same goes for our company. Our mathematicians and developers are constantly working on new ways of analyzing Esports titles, so that we can keep on increasing our offer and coverage of events and game aspects. The viewer base of Esports and investments in this field are only a glimpse of what Esports will become in five or ten years.”
WHO ARE THE PLAYERS?
Unlike traditional sports fans, Esports fans consider them as a lifestyle. Esports fans also spend much more time on forums and chats than average sports fans do, watching video games and Esports and commenting about them. For instance, 55% of adults aged 18-25 spend more time watching video game and Esports content than traditional sports content. Besides, it is a fact that 83% of Esports fans are below the age of 26. This leaves a massive space for growth. While 72% of Esports fans are males, female numbers are increasing. So what are Esports fans looking for? The number one priority for them is betting-focused content. What is even more important, are the differences in interest between esports and sports fans. Companies must provide customers with this new content, statistics and analytics, accompanied by social elements like chat or leaderboard, and the possibility of in-game purchasing. The most common ways to approach them are by using influencers, sports starts and athletes (really connected to their communities), or by sponsoring teams, players, leagues and events.
U.S. POTENTIAL FOR ESPORTS
Outside Asia and Europe, United States is definitely a market to explore and boost in terms of this activity. While Europe and U.S. have a comparable size of Esports audience, their Esports betting GGR is in contrast. What underlines the enormous potential of U.S. Esports betting market is the fact that, according to a Newzoo research, U.S. Esports fans generate double the average revenue per single fan. It is fair to say that average revenue per fan is still way lower than in traditional sports, but it also creates an opportunity for growth. With global Esports fan base constantly rising, and with the continuous evolution of the market in terms of revenue streams, Esports betting is expected to follow this trend as well in North America.
Of course, legislation is one of the main issues to solve in this huge market. Up to now, only New Jersey, Nevada or Tennessee have already ruled legal Esports betting. Other states don’t have clear ruling on Esports betting, and they allow sports betting, for example Arkansas, Delaware, New York or Iowa. There are also states that allow sports betting, but specifically outlaw Esports betting. However, looking at Esports betting market worldwide, U.S. is presenting one the most interesting destinations. The combination of high purchasing power and strong growth of Esports fan base is held back by legislative limitations. When those are removed, it will create a new strong source of revenue for betting operators.