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  • Matt Kimball

EWD: News for Week of 4/18/22-4/24/22

Topics: Partnerships, Newzoo, NBA 2K League, FTX

Partnerships


FURIA x FTX


Brazilian esports organization FURIA has reportedly signed on cryptocurrency exchange company FTX as a new sponsor. According to Esports Insider, FTX will pay approximately $3.2M dollars in a one-year deal.


The video announcement was released at 6 PM EST on April 22nd on FURIA's social channels. In the video, a women speaking in Portuguese, asked the question in relation to FURIA: "If FURIA is so inclusive, diverse, and freewheeling, which is basically what the crypto universe provides, why don't they have anything related to it?" She then said, talking about FTX's notoriety, "To give you an idea, they own their own arena in Miami now, they've already done business with Lewis Hamilton, Tom Brady, Shaquille O'Neil... so it's impossible not to recognize."


According to what FURIA said to Esports Insider, the one-year contract a first step as the organization aims to establish a ‘long term relationship’ with the sponsor. FTX, who has a 10-year naming rights deal with TSM, has already established a presence within the Brazil region in esports. Specifically, TSM FTX has invested in mobile esports teams in both Free Fire and League of Legends: Wild Rift in the region.


Kimball's Take:

  • Although there's no details as to how the FTX brand will be activated on the teams social channels, I believe FTX made a splash by partnering with an entity in FURIA that has a huge presence in South America. To get a sense of the region's love for esports, organization LOUD made it the Grand Finals of Valorant Champions Tour (VCT) Stage 1 Masters Reykjavík and yesterday's match peaked at 1,065,887 viewers. I don't have access to data that shows viewership by region, but I believe quite a bit of those viewers are in South America. I'm curious how the FTX brand will continue to increase their market size in South America and particularly in Brazil. Lastly, it's great to see a brand and organization disclose the amount of the sponsorship deal as this isn't seen much at all in the esports space.


Vitality x Secretlab


French esports organization Vitality enters a multiyear partnership with Secretlab. As part of the deal, Secretlab becomes Vitality's Official Gaming Chair partner. Additionally, Secretlab will create the "Titan Evo 2022 Team Vitality Edition chair," which will have a yellow color scheme featuring the organization’s bee logo. The 2 parties have been product-testing this new chair design and it's considered to be an upgrade from previous models. The chair will be used at Vitality’s V.Hive headquarters in Paris as well as its performance centers in Stade de France, Berlin and India.


Secretlab has been an integral part of the gaming and esports for quite a while now. The furniture maker has been involved in a number of global esports events, including Dota 2’s The International, the League of Legends World Championship, and the Valorant Champions Tour (VCT).


For Vitality, this new chair partner joins a boisterous sponsorship portfolio that includes Tezos, Adidas, Crédit Agricole, Phillips, SCUF, and Aldi.


Kimball's Take:

  • This is about as standard as you can get in a partnership. Gaming chairs are endemic in the gaming and esports industry for organizations. At least Secretlab is allowed to use Vitality's marks, logo, and color-scheme on their chair. However, I'm unsure if the newly-designed chairs will be available for purchase to the public.


Manchester City x Sony


Manchester City has partnered with Sony to build a virtual replica of the Etihad Stadium in the metaverse. This partnership came to fruition at the end of November last year, but apparently it's in the process of being built now. Sony became the “virtual fan engagement partner” of the Premier League club as part of this three-year partnership. Hawk-Eye, a subsidiary of Sony, will use its image analysis and skeletal-tracking technology to digitally recreate Etihad Stadium.


The virtual stadium will include a new fan loyalty rewards program and the ability for users to customize their avatars. Sony, according to Sport Techie, says it will use “multiple” technologies across its entire ecosystem to make Man City’s virtual world. Man City will soon become the first club in world football to reproduce their home venue in the virtual lands of the metaverse.


The reigning World Series champion Atlanta Braves are doing the same effort of creating a replica of their stadium in a virtual environment as well. However, the Braves partnered with Epic Games' Unreal Engine technology to create it.


Kimball's Take:

  • It's great to see more teams create opportunities that generate fan experiences in a digital environment. The ability for fans to watch their favorite team in an immersive metaverse setting allows fans around the world to get a sense of what it may feel like being physically in the stadium. Not only will it enhance the viewing experience and build a bigger community, it will also create a plethora of revenue generating opportunities whether it be sponsorship activations or virtual assets (merchandise, tickets, etc). Man City's launch into the metaverse also allows them to launch NFT integrated in the metaverse. This could be done by either showcasing your already-owned collectible or even creating exclusive wearable NFTs for people's avatars.


Riot Games Brazil x Santander


Riot Games has announced a five-year deal with bank Santander. The Santander brand will be featured in the Brazilian League of Legends Championship (CBLOL) and in its Academy division. According to Esports Insider, the Brazilian broadcasts of Mid-Season Invitational and League of Legends World Championship will also feature the new sponsor.


Besides having brand placement during the broadcast, the bank will also appear as the presenting partner. Santander will also be responsible for the match’s MVP prizing during the finals of the current split between Red Canids Kalunga and paiN Gaming (took place April 23rd).


Danielle Sardenberg, executive superintendent of marketing at Santander said:

The partnership with CBLOL represents a great milestone for Santander, which enters with all its might in one of the most traditional eSports championships in Brazil. We will walk side by side with gamers, both professionals and amateurs, as well as those who work to be a pro player in electronic sports. We are not here just to be just another sponsor, but also to contribute to the CBLOL Academy and, respectively, to the Brazilian eSports scenario.

Kimball's Take:

  • The bank's marketing and esports strategy seems very clear, sponsor big-name esports events and organizations in the Brazil region. The bank sponsors esports organization FURIA and the Brazilian Free Fire League (LBFF). With this new partnership, the bank now has its brand attached to two of the main competitions in the country. Apparently in 2021 a bank by the name of Itaú has conducted a lot of esports sponsorships in the region, but Santander is making an effort to steal some of its competitors shine in gaming and esports. As "Games Magazine Brazil" put it, Santander's partnership with CBLOL is part of an ambitious strategy to be recognized as "the bank of gaming in Brazil."


Other News


Newzoo Releases Esports & Streaming Market Report


Game data firm Newzoo released its “Global Esports and Live Streaming Market Report" for 2022. For starters, Newzoo projects the industry to generate nearly $1.38B in revenues by the end of thee year. To no surprise, sponsorship continues to be esports’ highest-grossing revenue stream. Revenue from brand partnerships accounts for 60% of the entire market, generating $837.3 million in 2022.


I highly encourage anyone curious about this industry to download the free version of this report. Click the link HERE to download. I'll cover 5 of the biggest insights that I thought were fairly noteworthy below:

  • Gaming and Esports Audience: The games live-streaming audience reached almost 810 million in 2021 and is expected to reach 1.41 billion by 2025, a CAGR of +16.3% from 2020 to 2025. Nongaming content is one of the drivers of massive growth, accounting for up to 21% of the content watched in 2021. More than 84% of users active in non-gaming categories are also active on gaming channels, which means that non-gaming content does not necessarily cannibalize gaming content on these platforms.

  • Diversifying revenue streams: successful esports organizations are diversifying their revenue streams. Direct-to-fan business models such as merchandising (physical or digital), loyalty programs, and educational programs are helping organizations diversify. Some esports organizations have turned to the financial market for alternative revenue streams beyond sponsorship (whether public listings or private investments). OverActive Media, Guild Esports, and Astralis are listed on various public markets. Tencent filed for an IPO in Hong Kong in February, and Savvy Gaming Group’s massive $1.5 billion acquisitions of ESL and FaceIt.

  • Annual revenue that comes from each Esports Enthusiast: 40% of Esports Enthusiasts have what Newzoo labels as high household income, which varies from region to region. For the United States, it’s $75,000 and up. The report estimates that there are 261.2 million of these passionate fans, who tune into an esport event at least once a month, and each generates $5.30. The age/gender split between males and females is 66/34% respectively. 31% of males are between 21 and 35, with the second biggest between 10-20 at 18%

  • Mobile Esports Emergence: Over the past few years, esports has expanded more and more into gaming’s biggest and most lucrative segment: mobile. Mobile esports titles dominate emerging markets like Latin America, the Middle East and Africa, Southeast Asia, and India. Brands outside the gaming sphere are testing the waters via mobile esports events.

  • Live-streaming Platforms: Twitch was the most popular games live-streaming platform in the West in 2021, seeing a +26% year-on-year increase with nearly 20 billion live gaming hours watched. YouTube Gaming was the second largest, with 4.7 billion live gaming hours watched. Twitch and YouTube Gaming is available worldwide except in China, where it is banned. The growth of mobile gaming in emerging economies across Southeast Asia and Latin America means these regions account for a huge share of viewership on YouTube Gaming.


NBA 2K League's 1st In-Person Event Took Place in Indianapolis


In-person NBA 2K League competitions began last week with bracket play of "THE TIPOFF Powered by AT&T" at The Pavilion at Pan Am. This is a brand new NBA 2K League studio where all in-person events for the league will take place.


The studio’s innovative design will feature two circular competition stages that allows for simultaneous in-person games that give the broadcast the opportunity to switch between games in real-time. Populous, a global architectural and design company specializing in sports facilities worked with the league to create this new arena. Matt Arden, head of content and media at the NBA 2K League and his team worked closely with Brian Mirakian senior principal/brand activation director at Populous and his crew to create a venue that was very innovative and never-before-seen in the industry. NBA 2K League President Brendan Donohue said:

After playing nearly all of the 2020 and 2021 seasons remotely, we are thrilled to get back to our live studio experience in the heart of downtown Indianapolis – a city overflowing with passionate basketball fans and known for putting on some of the biggest events in American sports. The NBA 2K League is proud to call Indianapolis our home for the 2022 season.

Additionally, Indiana Sports Corp is partnering with the NBA 2K League for this season. Indiana Sports Corp President Ryan Vaughn said that his team will "provide assistance in several capacities over the course of their 2022 competitions, and we look forward to welcoming this first-ever full tournament season, playoff and championship event to our city."


Lastly, the league this season is providing more opportunities for the 2 million+ people who play NBA 2K daily to compete in NBA 2K League competition. Amateur teams from around the world will have the opportunity to participate alongside NBA 2K League teams for a share of the tournament prize pool. In what is known as The Coinbase NBA2KL 3v3 BLACKTOP SERIES, including the SLAM OPEN, SWITCH OPEN and STEAL OPEN, amateur teams get the chance to compete against other NBA 2K League pro teams. The SLAM OPEN and SWITCH OPEN will include the 24 NBA 2K League teams, North American amateur teams that earned a spot through the tournaments’ qualifying events and Community Teams selected by the league and consisting of top players from the 2K community and social media influencers. The STEAL OPEN will include the 14 NBA 2K League teams that haven’t already qualified for the NBA2KL 3v3 Playoffs, and one amateur international team from each of the European and Asia-Pacific regions.


Kimball's Take:

  • I like the changes the NBA 2K League are doing as they hit the 5th anniversary of the league being created. It's been long overdue for the league to not have some integration of amateur players in their tournaments. I feel like there was a huge disconnect between what the competitive game ruleset and gameplay was showcasing on broadcast vs. what the majority of the player base is playing. By having a 3v3 blacktop-tournament series, it inspires fans of the league and those who are passionate about the game to get on everyday and try to make it to the big tournaments.

  • I don't exactly understand why the league decided to have their new studio in a market such as Indianapolis. I know Indy is a great basketball town with passionate fans, but I would assume that they'd get more fan attraction and/or attendance in bigger markets that have an esports presence such as New York, Los Angeles, or even Dallas.

Soccer Star Javier “Chicharito” Hernández Joins Complexity


Complexity has signed an agreement with LA Galaxy striker and Mexico national team’s all-time leading goal scorer, Javier “Chicharito” Hernández. He will join what is known as thee Complexity Stars division. Hernández join the likes of two-time NBA champion J.R. Smith, NFL running back Leonard Fournette and five-time UFC title winner Max Holloway.


The Complexity Stars division looks to mutually benefit both the organization and the athletes/influencers involved by cross-pollinating audiences from the sports and entertainment industries with the esports and gaming industry.


Chicharito becomes the first professional soccer/fútbol player signed to the division. He had this to say about joining the organization:

Gaming has always been a passion of mine, and by signing with Complexity Stars, I’ll be able to create content and host events to better engage with my fans off the pitch. Complexity has a rich history in gaming and esports, and after seeing their commitment to developing talent and fostering opportunities for athletes to organically grow with the space, I knew it would be a perfect fit.

According to Complexity, he represents the organizations “commitment to its growing Spanish-speaking audience, which comprises nearly 30% of its total fanbase.” The soccer/fútbol star will collaborate with Complexity’s diverse roster of talent on "unique experiences that combine the best of the real-world and virtual pitch." There will be more details in the near future regarding events, collaborations, and branded content with him and Complexity. Here's the video announcement that was posted on Complexity's YouTube channel.


Kimball's Take:

  • Hernández is another example of esports organizations adding professional athletes as content creators and bridging the gap between traditional sports and entertainment with esports. As seen by one of the Newzoo insights, diversifying revenue beyond sponsorship is paramount for organizations to be better than average. Complexity is very aware of this and is doing all the right things to be top-tier North American gaming/esports organization.

Twitch Streamer Castro Signs with CAA


FIFA Twitch streamer Edwin Castro has signed with CAA for representation in all areas of media. Castro has over 3.5 million followers on Twitch, averages 30,000 concurrent live viewers, and 1.3 million followers on Twitter. He is known for his content surrounding EA Sports' FIFA video Games.


According to the Hollywood Reporter, Castro has worked with brands such as 7-Eleven, Gillette, Electronic Arts and Turtle Beach. He was also seen in a McDonalds Super Bowl commercial earlier this year.


Among CAA’s other recent signings in the esports industry, pro gamer and esports personality Tarık Çelik joined with the agency in February and Seán William McLoughlin (goes by "Jacksepticeye") signed in October last year.


Kimball's Take:

  • Not too many details regarding the signing, but it's cool to see an agency such as CAA begin to make a presence in esports representation. I know CAA signed with 100 Thieves in the middle of 2020, but I'm unsure if they're still working together. Regardless, Castro has a huge presence on Twitch and social media and is certainly the biggest FIFA streamer in North America. He'll continue to get big endorsements and sponsorships his way under CAA's representation.


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