Honda Becomes 1st Automative Naming Rights Partner in LCS, Twitch's New Ad Revenue Model, and More!
EWD: News for Weeks of 6/13/22-6/19/22
Topics: Partnerships, Team Liquid, Honda, BLAST Premier, Twitch
Partnerships
Team Liquid x Honda
Honda expands its role as the official automaker of Team Liquid by securing their League of Legends and Academy team's naming sponsorship rights. This is the first time an automaker got official naming rights for a franchise in the League of Legends Championship Series (LCS) in North America. According to the Honda press release, the Team Liquid Honda naming rights deal also signals the evolution of Honda's esports and gaming journey as the brand reaches out to gamers at all levels to deepen its relationship with young, first-time and multicultural buyers.
Team Liquid Honda will debut the team's new name and its all-new jerseys at the 2022 LCS Summer Split, which started on June 17th. Honda became the official automotive partner and official vehicle of Team Liquid in 2019, and this new multi-year partnership extension adds other key elements such as:
New team jerseys feature the Honda logo prominently across the chest
Team Liquid Honda-branded vehicles for players and coaches, specifically the new Honda HR-V compact SUV and Civic Hatchback throughout the 2022-23 tournament season
All-new 'Honda Lounge' within the Team Liquid North America HQ
Team Liquid's League of Legends players social accounts will reflect the new Team Liquid Honda branding with new banners and inclusion in player display names on Twitter, Instagram and YouTube
Additionally, fans can show support for Team Liquid and Honda via Snapchat. Specifically, there's a Snapchat Lens where they can virtually try on the new jersey using augmented reality (AR) and share with their friends. The Lens also includes a direct link to pre-order the new jersey on the Team Liquid Honda store.
Phil Hruska, media department head at American Honda Motor Co., Inc. said:
We plan to build on the great relationship we have established with Team Liquid Honda by engaging more with young fans who are gamers themselves and work to deepen those relationships with the Honda brand.
Kimball's Take:
I like how Honda is approaching their commitment to the gaming and esports space. They mentioned how they have deep roots through both video games and sponsorship opportunities, mainly with Forza, Hearthstone Team Brawl, Twitch, and the LCS. They articulate that their goal in these partnerships recently is to interact with a broader audience of gaming fans and continue to apply the learnings from partner and fan relationships. It's clear that their play in the gaming/esports space is to grow its awareness as much as possible to a younger age demographic. By being in this industry for nearly a decade, they're differentiating themselves from other car competitors and aim to be the car brand in the forefront of gamers minds.
LEC & LLA x Santander
Santander announced a multi-year partnership agreement to become the main sponsor of the League of Legends European Championship (LEC) and Liga Latinoamérica (LLA). According to its press release, this new sponsorship brings Santander into the global ecosystem of esports, helping the bank promote innovation, diversity and digitalization.
They stated that the bank is also sponsoring the League of Legend’s Brazilian Championship (CBLOL) and that these League of Legends partnerships are 100% digital media-focused. As a partner for these leagues in Europe and in Latin America, Santander will display a variety of assets to promote the brand and raise awareness in the League of Legends communities during the esports events, including: logo placements, dedicated content segments, commercial slots during broadcast breaks, banners, drops and VIP tickets for the finals, among other things.
One other key detail they mentioned is League of Legends being one of the most successful esports worldwide, with some of the most developed professional competitions and established community of followers. In 2021, the League of Legends World Championship was one of the most watched esports events worldwide. Santander wants to build a new community and connect with younger generations to help them prosper.
Juan Manuel Cendoya, global head of Communications, Corporate Marketing and Research at Banco Santander, said:
We are excited to announce this new collaboration with a very innovative partner, with whom we are united by our attributes of innovation, diversity and digitalization. We believe that entering the world of esports will bring Santander new opportunities to engage with new generations of digital natives and help them prosper.
Kimball's Take:
Santander, just like Honda and a majority of other brands partnering with properties in the esports industry, want to garner brand awareness and connect with a digitally-savvy young gaming audience. In the press release, they mentioned that they have other global partnerships in their portfolio with F1 and football (Superliga), which complements their new League of Legends league partnerships in Europe and Latin America.
Team Vitality x Garnier Fructis
French esports organization Team Vitality partners with global beauty leader Garnier Fructis and L’Oréal group as the organization's first ever haircare partner. This collaboration spans across both 2022 and 2023, and marks L’Oréal Garnier Fructis first esports team partnership.
Garnier Fructis previous had a successful collaboration with Team Vitality about a year ago with their V for Veuch campaign, which was a sci-fi inspired video starring Team Vitality players and ambassadors such as LittleBigWhale and Victor “Fairy Peak!” Locquet on a mission to take down a mysterious monster with the help of Garnier Fructis. According to the Team Vitality press release, the partnership will see a continuation of the V for Veuch brand campaign, centering around the power of Garnier Fructis products. Check out the new campaign video.
With the new theme, ‘The Force Returns’, Team Vitality and Garnier-Fructis will work together on inspired brand activations. Fans will also have the opportunity to immerse themself in the campaign at selected events alongside Team Vitality’s players. There will also be "exclusive opportunities" for fans to receive through Team Vitality’s social channels as they work together with Garnier-Fructis. The haircare brand will have visibility across all of Team Vitality’s rosters including the likes of League of Legends, CS:GO, and VALORANT with players showcasing the brand through content and digital assets.
Stéphanie Borri, General Manager Garnier France, said:
Today, more than ever, we take pride in exploring new areas of expression to maintain the intimacy and authenticity that binds us to our target audience. As a result, it was only natural for us to take our first step into the world of esports last year and we are thrilled to be able to continue this beautiful partnership with Team Vitality! This is a great opportunity for our iconic Brand Garnier Fructis to strengthen its presence among Gen Z through the implementation of fun and offbeat activations!
Kimball's Take:
It was kind've hard for me to understand the creative videos they did with the brand last year and this year because it was in French. However, the video were very well-produced and creative as well. Vitality is sneakily good at finding a wide-range of brands to partner with them and I tend to see myself covering them quite a bit on her. They're very creative in how the brands sponsor the team and fulfill very niche categories that I've never seen in the gaming space. I believe there should be more opportunities for Haircare or hygiene-type brands to sponsor gaming organizations due to the stigma that surround gamers lack of hygiene. Love this partnership.
BLAST Premier Unveils 4 New Partners
CS:GO esports circuit BLAST Premier unveiled 4 new partners for its Spring Finals in Lisbon, Portugal last weekend: Magnum, OMEN, MOCHE, and Teleperformance. This past weekend's Spring Final was the 2nd BLAST event to take place in Lisbon – following the BLAST Pro Series, which sold out at the same venue back in December 2018. The event started on June 15th, ended on June 19th, and took place at the Altice Arena.
As part of the deals, the branding of all four partners were featured within the Arena over the course of the event. Those attending the event had the opportunity to participate in product giveaways in addition to a range of in-person activations. OMEN, Unilever-owned Magnum and lifestyle brand MOCHE returned as BLAST Premier partners, while the Spring Final will be business service provider Teleperformance’s first event with the tournament organizer. Fans in Altice Arena will be able to win product giveaways and enjoy a number of in-person activations.
Oliver Clarke, Commercial Director for BLAST, said this on the deals:
Four years ago the Portuguese esports community showcased why they’re one of the most enthusiastic and passionate fan bases in the world. We look forward to building on that experience with the help of our partners, to engage and excite the thousands of fans in the Altice Arena and the millions watching from home.”
According to Esports Insider, these partnerships follow the circuit securing a media rights deal with sports subscription service DAZN. The deal saw the Spring Final, and BLAST Premier’s remaining tournaments of the 2022 season, become available in over 100 territories. The number of Spring Final partners increases to nine with the likes of Betway, CS.MONEY and audio equipment company EPOS already confirmed as partners of the event.
Other News
Kevin Durant, Thirty Five Ventures Joins Andbox
Brooklyn Nets (NBA) superstar Kevin Durant (KD), business partner Rich Kleiman and their investment arm Thirty Five Ventures have joined New York-based esports organization Andbox as investors and creative partners. Durant will help Andbox— which owns and operates the Call of Duty League’s New York Subliners, the Overwatch League’s NYXL and the Andbox Valorant team—raise brand awareness, collaborate with gamers on online tournaments and live events and create custom merchandise and apparel, according to Forbes.
KD is an avid 2K and Call of Duty player and fanatic, so much so that he told Kleiman that 2K is as important to him as anything after playing in the NBA. Though not a gamer himself, Kleiman was impressed by the many verticals Andbox is involved in and how many opportunities it has to expand its brand. The alignment in the heart of NY made it a "no-brainer” for both of them and Thirty Five Ventures to join as business/creative partners.
According to Farzam Kamel, Andbox’s co-founder and president, There was always a natural synergy and connection in the sports business world between Thirty Five Ventures and Andbox. This allowed for easy conversations and a pretty quick move toward an agreement. The size of the investment was not disclosed, but “he has material skin in the game,” Kamel said.
According to Forbes, Andbox is excited to showcase what its esports organization is about to a much broader audience of people who love gaming as much as Durant does but don’t necessarily follow esports. That will involve everything from content series and merchandise releases to live online events and tournaments until it’s safe to have in-person events. Fans will also start to see Durant wearing Andbox apparel and co-created content that will be distributed across both properties, including Thirty Five Ventures’ Boardroom.
KD said this to say via a press release:
The passion that New York sports fans have has really hit home with me. Andbox is bringing that same energy to esports here, and that’s something Thirty Five Ventures is very excited to be a part of.
Kimball's Take:
Love this partnership between businesses in the sports landscape. More and more athletes are joining esports organizations either as content creators or investors. Anthony Davis, star athlete for the LA Lakers, most recently joined Nuke Squad which is a content team within FaZe Clan.
It's also great to have the 2 companies work together synergistically to create marketing initiatives that bring the NYC community together. The Forbes article mentioned how they'll start having frequent meetings and how bringing Durant’s name up in pitches and meetings will certainly help in expanding its list of brand partners and sponsors.
Twitch's New Livestream Ad Revenue Changes
Twitch is testing out a new Ads Incentive Program (AIP) for streamers to run a set amount of ads every hour for a pre-determined monthly payout, among other details. The recent news, however, is stirring controversy among creators and viewers.
Here's the rundown from the June 14th Twitch blog post about this:
Ads Incentive program (AIP): each month a creator gets an offer. If they stream for a specific amount of hours in that month with a specific ad-density, they’ll receive a predetermined payout. Let the Ads Manager handle the ads and at the end of the month you get paid.
Plan on opening up the program to more Twitch Partners than ever. No specifics into how many more streamers they intend to extend the offers to
Traditionally, Twitch calculated Creator earnings from ads through a fixed CPM — a flat rate for every 1,000 ad views on their channel. To increase ad payouts and ensure we can pass price increases through to Creators, they moved away from fixed CPM structure to a percentage-based revenue share model.
The percentage-based revenue share model pays creators 55% of the revenue for each ad that runs on their stream.
This change represents a 50-150% ad pay rate increase for the vast majority of Creators on Twitch (CPM values and average CPMs during 2021 to estimate rates on an equivalent revenue share model. Ad revenue depends on a variety of factors)
In August, 55% split will apply to affiliates, not just AIP users who get the higher rev share. Set Ads Manager to three minutes (or more) per hour to be qualified for new split. Affiliates who opt-in to three minutes/hour get to stream free of pre-rolls
Twitch's Revenue Generating, EXTREMELY simplified: It's clear that over the last several months Twitch has tried to find ways to improve their bottom line. The main way, or best way, for them to do this is through an ad-based revenue system. This is because their other revenue generating option, receiving a 50% split (in most cases) from $5 twitch subscriptions to creators, isn't generating nearly enough money for them to be profitable after all the operating expenses. Additionally, $5 Twitch subscriptions are a non-scalable rate while ads can sell at a rate based on CPM, which can fluctuate based on a number of factors. Thus, they've come to a solution and tried to find a fine line between:
scaling the companies revenue via ads,
making streamers run more ads while also giving them a split of revenue,
and making sure viewers don't stray away from exiting streams due to an increase in ad volume
Kimball's Take: Twitch talked about the positives, let's talk about the negatives
Although streamers are incentivized to run more ads now by getting a higher split of revenue rather than a fixed CPM rate, the new issue now is that 3 minutes of ads per hour is far too much for such an ad-aversed live streaming audience. From my perspective, the current state of Twitch is unwatchable without an adblocker. Depending on the partnered or affiliate streamer, some are running ads on a range from 1 minute-to-9 minutes per hour. This means that you can miss quite a bit of action in a live setting, unlike with cable television and traditional TV viewing.
You may think that streamers like this new ad percentage-based revenue share model, but they have, or think they will experience, diminishing viewership. TimTheTatMan, who recently switched to YouTube, had a LOT to say on the matter.
As I've mentioned, ads will never go away because that's how Twitch can stay afloat and not be a dead asset for Amazon. One easy solution to solve the missed action viewers get with ads is to introduce a playback feature just like YouTube does with their skip and rewind feature during livestreams. Alternatively, they can make ads skippable like YouTube does in their video format. I'm unsure if this would affect revenue for both parties because then nobody would watch the ads in full.
LCS 2022 Championship Will Be at United Center
League of Legends Championship Series (LCS) Summer split finals will return to Chicago, Illinois at the United Center. The 2022 LCS Championship, delivered by Grubhub, will take place on September 10-11. The United Center, home of the Chicago Bulls and Blackhawks has a capacity of 23,500. Comparatively, the Chicago Theater was the last place that North America was the host region for the World Championship and that had a 3,800 seat capacity.
To celebrate and support the growth of Chicago’s esports community, the LCS is working with the Chicago Park District, Youth Guidance and I Play Games! as official Youth Outreach Partners of the 2022 LCS Championship. According to the Riot Games press release, they will provide a unique, behind-the-scenes experience at the United Center for local students, parents and educators. They will also provide curated experiences, including activations at Fan Fest, backstage VIP tours, and access to a dedicated panel where the guests can hear firsthand from Riot employees about careers and educational pathways into esports.
Tickets for the 2022 LCS Championship will go on sale Friday, June 24 at 10:00am PT, with a special pre-sale window on Thursday, June 23 at 10:00am PT for Mastercard holders.
Kimball's Take:
Not much takeaways from this. It's great that they're working with youth nonprofit organizations and making efforts of growing the esports community at Chicago locally. There hasn't been many esports events at all in Chicago from my understanding, so generating that awareness is huge.