How Would You Summarize The Global Esports Market?

The global esports market is growing rapidly, with new tournaments and leagues sprouting up all over the world. But how do you summarize such a rapidly growing and diverse market?

Introduction

The global esports market is expected to generate revenue of $1.79 billion in 2021, an increase of 27.7% from $1.40 billion in 2020. This includes revenues from media rights, advertising, sponsorship, merchandise and tickets, as well as game publisher fees.

The total global esports audience will reach 495.0 million people in 2021, up from439.5 million in 2020. In 2021, there will be 201 million occasional viewers and 294 million esports enthusiasts.

The Global Esports Market

The global esports market is expected to generate revenue of $1.1 billion in 2020, a year-on-year increase of 27.2%. This is largely due to the surge in investment from companies and organizations outside of the traditional esports ecosystem. In 2020, non-endemic companies are projected to account for 42% of all esports sponsorship revenue.

Market Size and Growth

The global esports market is estimated to be worth $1.1 billion in 2020, a year-on-year growth of 26.7%. Of this, $822.4 million will come from sponsorship, while $269.1 million and $101.9 million will come from media rights and game publisher fees respectively. By 2023, the market is estimated to grow to $1.8 billion.

Revenue Streams

The global esports market is expected to generate revenue of $1.1 billion in 2019, a year-on-year increase of 27.4%. This is primarily being driven by the sale of media rights, sponsorship, and advertising around esports events and content, as well as revenue from game publisher fees.

There are a number of different revenue streams associated with the esports market:

Media rights: This includes revenue generated from the sale of broadcasting rights to esports events, as well as any accompanying digital rights.

Sponsorship: Brands are increasingly looking to get involved with esports by sponsoring teams, tournaments, or individual players. This provides them with valuable exposure to the lucrative millennial demographic.

Advertising: Esports events offer a captive audience for brands looking to reach millennials and Gen Z consumers. In-game advertising is also becoming increasingly commonplace.

Game publisher fees: A proportion of the revenue generated by game publishers from the sale of esports-related products (such as in-game items) is shared with tournament organizers and other stakeholders in the ecosystem.

Key Markets

The global esports market is expected to see strong growth in the coming years, driven by North America and Asia Pacific.

North America is the largest market for esports, with a revenue of $1.1 billion in 2020. The region is expected to grow at a CAGR of 11.7% between 2020 and 2025, to reach a revenue of $2.6 billion by 2025. The strong growth in North America is being driven by the growing popularity of esports, the increasing investment in the industry, and the expansion of the professional esports scene.

Asia Pacific is the second largest market for esports, with a revenue of $693 million in 2020. The region is expected to grow at a CAGR of 18.3% between 2020 and 2025, to reach a revenue of $1.7 billion by 2025. The strong growth in Asia Pacific is being driven by the growing popularity of esports, the increasing investment in the industry, and the expansion of the professional esports scene.

The global esports market is expected to see strong growth in the coming years, driven by North America and Asia Pacific.

North America is currently the largest market for esports due to its large population and high levels of disposable income. The region is expected to continue growing at a rate of 11.7% between 2020 and 2025 due largely to increasing popularity and investment in professional gaming leagues.

Similarly, Asia Pacific--which consists of populous countries such as China and India--is predicted to experience rapid growth in its esports industries over the next five years due both to its large amount of potential viewers as well as recent infrastructural developments such as 5G networks that will facilitate online gaming competitions.

The Future of the Global Esports Market

Industry Trends

The esports market is growing rapidly, with new tournaments, games, and leagues springing up all the time. This growth is being driven by a number of factors, including the increasing popularity of esports among both spectators and participants, the declining cost of entry into the industry, and the growing availability of high-quality streaming platforms.

As the esports market continues to grow, industry insiders expect to see a number of changes and trends emerge. These include an increase in the number of women participating in esports, a shift towards mobile gaming, and the continued rise of South Korea as an esports powerhouse. Additionally, as more brands seek to get involved in esports, sponsorships are expected to become an increasingly important source of revenue for tournament organizers and teams.

Market Drivers

The growth of the global esports market is being driven by several key factors.

The first is the increasing popularity of gaming and esports-related content among young people. According to a 2018 report by the Pew Research Center, 97% of young people in the US say they play video games, and nearly half say they play competitively. This trend is being mirrored in other countries around the world.

Second, there is a growing number of professional gamers who are being signed by teams and organizations, and who are earning significant salaries and prize money from playing in tournaments. This is helping to legitimize esports as a viable profession, and is attracting more people to the industry.

Third, companies and brands are increasingly investing in esports, partnering with teams and sponsorships, and using it as a marketing platform to reach young consumers. This is resulting in more funding and resources being funneled into the industry, which is helping it to grow at a rapid pace.

Finally, there is a growing number of dedicated esports venues and arenas being built around the world, which are providing a better infrastructure for tournaments and events. This is further boosting the growth of the industry.

Market Challenges

The global esports market is expected to reach $1.1 billion by the end of 2019, with a CAGR of 26.7% over the next four years.1 While the market presents significant opportunities for investors, there are also a number of challenges that need to be considered.

The first challenge is the fragmentation of the market. The esports industry is still in its early stages of development and there is no clear leader in terms of organizing and governing bodies. This fragmentation makes it difficult for sponsors and advertisers to identify where to invest their money, and creates a barrier to entry for new companies looking to enter the market.

Another challenge is the lack of regulation around esports competitions. This lack of regulation means that there are no clear rules or guidelines around how tournaments should be run, which can lead to unfairness and controversy. This lack of regulation also makes it difficult for sponsors and advertisers to get involved in esports, as they cannot be sure that their investment will be protected.

The final challenge facing the global esports market is the fact that it is still largely male-dominated. Women make up just 22% of all gamers, and only 5% of professional gamers are women.2 This lack of gender diversity presents a number of challenges, including a lack of role models for female gamers, and a potential danger of sexual harassment and discrimination within the industry.