Off the Sidelines and Into the Game
What eSports Can Teach Other Industries About Innovation
By Elizabeth Huebsch, Insights Strategist at Bionic, part of Accenture Song
Entire industries struggled during the pandemic as their customers retreated into their homes to avoid the risks of in-person interaction. However, for the online gaming industry, which gives people ways to socialize and be entertained from the safety of their homes, it was an opportunity for explosive expansion. In fact, it helped drive the growth of the gaming industry into a $180.3 billion dollar industry in 2021. A large portion of this growth was in eSports — where some people play online games and then others watch them do it.
As with sports in the analog world, eSports has players and teams, as well as fervent fans. The fans follow their teams’ schedules, root for both scrappy newcomers and well-known superstars, and form communities to talk about the game. While traditional sports were put on hold during the pandemic, eSports flourished, in part because events were able to continue virtually, allowing existing and new fans to gather and watch their favorite teams and players. Platforms like Twitch and Discord let fans talk and text in real time to each other, and sometimes directly to the gamers they’re watching. (If you’re having a hard time imagining how it works, think of how you’ve gotten used to using tools like Slack and Zoom to chat, screenshare, and present to colleagues remotely… It’s a lot like that, just with more cheering and on-screen action.)
ESports aficionados are extremely interactive, following their favorite gamers on various social media platforms and creating communities where they create and share content. They’re limited only by internet availability, which makes the fanbase international, multicultural, and increasingly diverse. That has created even more opportunities for gaming companies to grow — for example, by making their games more broadly representative of the audience to attract even more fans, and by creating gaming equipment for people with different abilities.
If you’re at a large company, you may be thinking, “So what? What does any of this have to do with my business?” That’s a common reaction. In fact, it was our reaction as well — until a consumer goods company approached Bionic, part of Accenture Song to help it explore the potential of creating white label products for gaming companies. New to the gaming industry ourselves, we dove into the world of eSports. After some quality couch time watching and interacting with people competing and engaging in virtual worlds, sometimes for large amounts of prize money, we realized that eSports is something no company can afford to overlook.
For one thing, the eSports market is the very definition of New to Big. Although the gaming industry existed pre-pandemic, it generated a record $180.3 billion in revenue in 2021 from millions of people worldwide — both pros and amateurs who play games, as well as those who just enjoy watching others play. In other words, this is not a brief trend or a small niche. It is a massive opportunity on the new frontier of interaction and entertainment.
ESports also shows the need for traditional enterprises to look beyond transactional relationships to the importance of relational networks in creating new markets. ESports fans cluster in hyper-loyal microcommunities for individual gamers, teams, and franchises. Gaming brands also have huge social media followings. Popular gamers are as protective of their fans, as their fans are of them. That makes influencer marketing one of the industry’s most powerful tools for growth. However, it also means that the audience doesn’t accept new offerings unquestioningly.
Every product and brand gets publicly vetted and critiqued for its impact on the community. A product that doesn’t pass muster gets harshly criticized, or at best ignored. For example, when a financial services firm embedded an ad for its brand in the scenery of one popular game, it was soundly mocked by GenZ players, who found the ad incongruous in the context of the game, and also irrelevant to their interests as young people with few assets to manage.
On the other hand, a product that wins the approval of one community is likely to spread like wildfire — not just within it, but to other communities that intersect, such as the fans of other players on the same eSports team and the highly active gaming servers on Discord.
Finally, this expanding market demonstrates the critical importance of understanding who the audience really is. Like other industries that rely heavily on sponsorships and brand partnerships for revenue, eSports is dominated by a handful of brands. In eSports, these brands are effectively lean start-ups: highly specialized, reliant on larger traditional companies to manufacture and distribute their products, and hesitant to risk their existing success by trying to scale and pursue new business models. As a result, they’ll test something new with their existing core audience — i.e. hardcore gamers — but fail to reach out to potential new segments of consumers. That leaves them vulnerable to challenges from competitors who are willing and able to use customer research capabilities to identify fringe use cases and use them as seed beds for innovative new products.
As the metaverse becomes more accessible and approachable to people of all ages, demographics, and abilities, it offers a new market and audience base for all kinds of companies to experiment with new products and services that address emerging consumer problems. Some of these companies may decide to enter the market with products that are specific to or related to gaming. Others could use it as a way to identify and test messaging on potential customer segments. The biggest risk is not the way a company decides to explore this growing entertainment market; it is deciding not to do so. An enterprise that fails to understand the potential of eSports as a platform is the modern equivalent of one in the 1950s deciding that television is a flash in the pan.
