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Esports: How Retailers Can Score High Sales

What are esports, and can retailers provide the gear their customers are seeking?

Esports are serious events, with the possibility of serious payouts for CE retailers who know their audience. What are esports, and can retailers provide the gear their customers are seeking?

There is no denying the growing size and popularity of esports. IDC is projecting esports will generate more than $2.2 billion in revenue this year from pro tournaments, leagues, companies, betting, and influencer marketing, up from around $1.7 billion in 2019.

But what are esports? Esports are the professionalization of competitive video game playing through formal franchised leagues, major tournament circuits, and one-off special events/tournaments. While not exactly on the scale of the NFL, MLB, NBA, or NHL, the top esports team, TSM, is worth more than four Major League Soccer franchises.

How can consumer technology retailers profit from the lucrative pro gaming market? “Esports players use premium hardware for sure,” advises Lewis Ward, IDC’s gaming, esports, and VR/AR research director. “Obviously, this implies that as esports continues to grow worldwide, retailers have an opportunity to grab a piece of an expanding associated spending pie for systems and accessories and beyond.”

Professional-level gaming gear is both highly desirable and pricey, which is good news for retailers. But what will drive these premium hardware sales? The short answer: extending the belief that, with the right gear, any gamer could become a rich and famous pro.

“Esports feel more attainable to the average video game player vs. the attainability of traditional sports to the average person,” observes Matthew Ungaro, esports director, business solutions, at New York’s MSG Networks. “As a result, average gamers like to spend on top-of-the-line PCs and gaming peripherals products – headsets, keyboards, mice – as it can give you a slight edge over your competition.”

More importantly, Ungaro stresses, “all gamers, from the casual video game player to the hardcore professional esports athlete, purchase their gear from a retailer, so being able to differentiate yourself as the primary channel customers go to for the top-of-the-line gaming products can go a long way to driving business.”

Play Like a Pro

Just like any pro sport, connecting gaming hardware you also sell to “the pros” is a key marketing strategy according to industry observers.

“Retailers and manufacturers gain positive optics on their company if ‘pros’ are utilizing their equipment in a competition,” explains Emily Herbert, research associate on the North America team for Counterpoint. “Adding the word ‘pro’ now usually means there are better specs than a base model, and that often comes with a higher price tag. Highlighting why the specs are better and necessary to better gameplay will be the most effective upsell.”

Influencers Influence Sales

Like any pro sport, “influencers” also help drive interest and sales – regardless of gender. Although video gaming is usually portrayed as a testosterone-charged activity, according to Statistica 45% of games in 2021 were women, with actress Olivia Munn serving as the face of women gamers and Lori Bajorek serving as president of the National Esports Association (NSA). Steph Curry, Mark Cuban, Drake, David Beckham, The Weeknd, Ashton Kutcher, Mike Tyson, and Michael Jordan are among the many celebrities who have invested in esports.

“Some marketers have begun to lean into to market gaming products is the crossover between sports stars/musicians and gaming,” Ungaro points out. “The general message these types of campaigns push is that ‘everyone games’ and leveraging famous sports stars and musicians helps to normalize gaming as a lifestyle and makes it more digestible and understandable to the masses. Understanding the importance of the influencer in the gaming space can go a long way to connect better with customers. Leveraging gaming influencers – e.g., someone who creates gaming-focused content on YouTube, Twitch, or other platforms – is likely the number one way to market products in the gaming lifestyle space these days.”

“Influencers can be a marketing opportunity through sponsorship, a merchandising reselling opportunity and can drive sales of accessories, PC or console hardware or games in-store depending on what they are promoting or using on-stream,” agrees Piers Harding-Rolls, research director for Ampere Games. “There’s also an opportunity to do in-person events in store to drive footfall.”

In-person, in-store gaming events could include esport tournaments or creating or sponsoring local esport events. “Specific gaming- and sports-related retailers in specific regions/metro areas could start carrying esports team merch that’s local to them,” adds IDC’s Ward. “Some esports teams generate significant revenue from merch on their websites, so perhaps local retailers could get into this space and generate some cheddar.”

See also: Gaming In Retail: Trends To Watch