Liquiditeam
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Liquiditeam

Why eSports is the Accidental Trailblazer of Digital Innovation

And how sports teams can learn from them

a gaming keyboard close u p image
eSports digital business models are something to be learned from

“You are watching someone else play video games? You’ve entered new dimensions of nerdliness.”

A small wave of shame trickles down my spine as my dad shuts the door and leaves the room. I whisper whatever 2011’s version of “boomer” might have been and eat another pringle.

Despite this shame, eSports has been on an interstellar trajectory ever since. An important driver of this might be because the mechanisms of the medium invite innovation, unlike any other sport.

How, you probably aren’t asking? The sport is played digitally, watched digitally (mostly), purchases are made digitally, and the core fan demographics spend a lot of their leisure time on digital avenues.

For eSports organizations, this represents a lucrative and seamless opportunity to reach and engage with existing and new fans. For fans, this is also a unique opportunity for direct contact with their favorite gamers or teams, and potentially even contribute to decisions.

While many companies are struggling to adapt and gain a foothold into a more digital-oriented business landscape, us nerds have set the tone for the rest to follow.

Fan engagement and peer-to-peer interaction is key

Along with his inability to open a PDF, my dad also failed to realize that watching eSports was actually playing a key role in developing strong empathy and social interaction through activating mirror neurons. This was obvious to me at the time of course. *cough cough*

Sounds like desperate guilt aversion or a slow-boiling pot of BS stew but it’s actually true. Just ask Ornella Valenti from the Department of Cognitive Neurobiology at the Centre for Brain Research of the MedUni Vienna. They published a study on how our brain’s mirror neurons mimic the emotions and expressions of others. Their study had a particular focus on football fans. Here is a quick excerpt:

“Fans, who themselves play or have played a lot of football and who know how the game works, are better able to “read” a game…Studies have shown that, during the game, these football experts are better able to predict the moves. When they do this their mirror neurons are firing more than in other people who understand less about football.” In control groups, who have never, or rarely, seen a football match and have not played themselves, the mirror neurons did not fire at all or barely. Says Valenti: “Mirror neurons apparently enable us to pick up the intentions of others intuitively. And all the more, the better acquainted we are with these intentions or actions from our own experience.”

I highly recommend checking out the full study if you have some time.

Although the study is referencing football, I apply this same thesis to eSports. We watch for the same reasons and then some. Even amateur spectators can improve their League of Legends skills (perhaps only marginally) by watching professionals in tournaments or via live stream.

To be fair, it is definitely possible to watch professional sports to improve your own game, but I believe that ceiling is limited. There isn’t much I can improve about my football skills from watching Tom Brady or Julio Jones. One of those guys is a freak athlete with immense leaping ability, speed, and agility — the other is Julio Jones. My threshold for improvement is capped in my opinion.

Another important facet that eSports has instituted: the peer-to-peer fan interaction (twitch chat, forums, discord, Ventrilo, etc). This community forum filled with banter and toxic behavior may seem like the underbelly of the internet to a laymen — but it represents an important adhesive to the gaming community. Every greasy neckbeard knows that you come for the gaming but you stay for the chat.

So now that I have proven my dad wrong and can unequivocally say that watching eSports is the key to mental health and empathy — ahem— let’s talk about how eSports has become a beacon of digital business model superiority.

A perfect model of strategic digital superiority

The eSports and gaming community sits accidentally entrenched within an ecosystem of digital business models that other segments would kill to replicate — especially as a consequence of the current pandemic.

As that pandemic gripped the entire world’s ecomomy, we saw hordes of legacy consumer verticals rush to adapt their business models to survive in the new socially-distanced dystopia. According to a recent McKinsey study, we have “vaulted five years forward in consumer and business digital adoption in a matter of around eight weeks.”

Pandemic or not, markets were shifting toward digital business models — we simply got a little kick in the ass.

Enter the eSports and gaming segment — the accidental trailblazers of digital innovation. As I mentioned in my introductory monologue regarding eSports:

  • The product is delivered digitally.
  • The audience consumes the product and makes purchases almost exclusively digitally.
  • The target audience spends a lot of their leisure time on digital mediums.
  • The audience engages amongst themselves mostly digitally.

I mean, what else do you need in order to successfully market to your ideal consumer persona? It’s the gazelle sleeping, hanging out, eating/drinking, and telling their gazelle friends about their new keto diet — directly at the alligator-infested watering hole.

No offense to any of my fellow gamers but we are a deliciously decadent potential meal for marketers and advertisers because of our digitally-native tendencies.

But seriously, because the ideal audience of eSports is accustomed to interacting with their favorite brands via digital channels, those brands can experiment with different forms of premium and interactive content.

Some perspective: Outside of franchised eSports teams, various competitions have dished out close to $232 million in 2020 to top performers.

Valve understood this when they funneled 25% of all compendium (an in-game item purchase) sales to go towards prize pools of their annual tournament, The International 10. Its an infinite monetization loop as in-game sales fuel tournament winnings which then fuels more in-game sales which then... Yeah.

Valve and other gaming companies have been trailblazers in the digital attention economy by understanding that strategically embedding those digital channels with revenue-generating mana pots along the way was key. For eSports teams and athletes, a next logical step (in my humble opinion) is to create an owned ecosystem on which to generate more value to both yourself and your fans.

Enter Liquiditeam, an eSports fan engagement and tokenization startup that is doing just that.

Sports technology meets blockchain

To keep it short and sweet, we at Liquiditeam are developing token-based financing and fan engagement solutions for professional sports clubs and athletes.

One of our fearless founders Thomas Euler created a very in-depth article on fan tokenization within the sports industry — and he breaks down the way such technology can be leveraged. It is in-depth and gives a great snapshot of our approach and the business utility it provides. And while his analysis is sports-focused, the technology was almost made for eSports.

Here is a quick boilerplate of the platform, which we call the LT Fan Platform:

With LT Fan Platform, every professional sports club and athlete can now create an engaging digital home for their fanbase — and build a digital-native business model on top with ease.

The core mechanism behind the white label platform is a blockchain-based token that users can buy, earn, trade, etc. for their engagement, interaction, ideations, etc. The possibilities are realistically limited to your imagination.

  • It can be behind the scenes premium content of players, scrimmages, etc.
  • Fan ideations and proposals of team names, hero/map selection, game modes, team jersey designs
  • Fan-controlled gaming and fan all-star games
  • And in the future, we plan to add digital/physical collectibles of player cards, highlights, etc.

The platform acts as a hub on which you can build it all — as opposed to similar tokenization or digital collectible companies who might be one-trick-ponies and specialize in one or the other.

The kicker is that you own it. You are creating your own ecosystem with a direct link to your fans.

Closing thoughts

If anything I have said before the previous sales’ey paragraph stuck — you might be able to see how eSports and gaming would adopt this technology seamlessly.

While our small roster of two clients includes top football club Borussia Dortmund and NBA star Dennis Schröder — with many advanced talks with other big names — we are thrilled to see how we can make a splash within eSports.

Shameless plug to top it off: we will soon be accepting limited (not a scarcity marketing technique, we are just a small team) applications for an Early Adopter Club. The club will be open to teams and athletes to try the platform with zero software-licensing costs for the first year. Essentially, the only investment for you is the effort to operate the platform. The reason for this program is to get our solution into the hands of as many users as is possible so we can continue iterating and optimizing to make it the best solution on the market.

Stay tuned for the official post with all the information.

If you are interested to learn more, check out our website or schedule a demo. And visit the BVB-FanToken App to see the LT Fan Platform in action.

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Powering Web3 Business Models for the Creator Economy & Sports. We build innovative fan engagement and financing solutions for creators, rightsholders, and athletes.

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Ron Jaradat

Ron Jaradat

Digital Marketing Playmaker at Liquiditeam | Writes about Blockchain, the creator economy, and fantasy football.

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