2019 Esports Industry Trends

While video game tournaments have been around for decades, in the past few years the Esports industry has undergone a rapid expansion, as the entertainment sector has merged with the gaming industry to create a global phenomenon, reaching an estimated 400 million individuals globally in 2018. To put this growth into perspective, established media companies, including Disney (ESPN), Turner Broadcasting, and the BBC, have begun to distribute Esports content on their flagship networks, expanding the reach of the nascent industry beyond that of online providers like YouTube and Twitch.tv. This increased exposure has expanded the opportunity for Esports organizations to benefit from increased investment and advertising revenue, allowing for further development and expansion of the industry.

Current market trends suggest that Esports fans are predominantly young, affluent males. However, as the industry continues to grow, it is expected that female audiences will generate an ever-increasing percentage of viewers. The constant denominator between male and female audiences continues to be age; for example, males aged 16 to 24 are two to three times more likely to be engaged with Esports competitions on a monthly basis as compared to any other age demographic. However, mature markets such as the United States, United Kingdom, and Germany often see engagement levels increase by up to four times amongst older age demographics. Research also shows that mature market hubs are now housing some of the top gaming industry brand names and, in doing so, are creating smaller, specialized regional Esports hubs (e.g. Los Angeles, CA and Berlin, Germany).

As the Esports and gaming industry continues to expand, brands must learn to foster a positive image that simultaneously embraces exclusivity and diversity. It is now more important than ever that brands cater their messages to appeal to the unique interests of their potentially diverse audiences. Not only are the number of participants growing, but so too are the number of audience members. Both participants and viewers represent two unique markets that brands can and should appeal to in the upcoming year.

As a result of the $900+ million in revenue in 2018 directly associated with Esports, a growing number of brands have undertaken heavy investment in the industry; it is expected that brands will spend an estimated $1.4 billion annually by 2021 on marketing and advertising within the Esports and gaming industry. As the industry continues to grow, experts predict that there will be an emergence of new franchises, a convergence of business models, and a growth in content distribution platforms.

How can we help?

Teknos Associates is uniquely positioned to identify and analyze the current and anticipated trends within the Esports and gaming industry. From our significant knowledge of how the Esports and gaming industries have developed, to our first-hand experience providing advisory services to organizations at all stages of development and growth, our team is ready to help brands capitalize on the myriad of opportunities available in the Esports and gaming industries. Our vast experience includes providing valuations, offering structural guidance, and delivering strategic analyses. To learn more, contact Teknos Associates at info@teknosassociates.com.

Teknos Associates provides valuation and advisory services for emerging growth companies and their venture capital backers. Clients rely on our financial expertise, knowledge of technology markets, and high standards to deliver relevant and timely valuation reports, opinions, and analyses.


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