eSports: The Next Retail Marketing Frontier

A general rule of thumb in marketing is to advertise wherever your consumers are, which is why commercials and campaigns around sporting events can be so effective. Minute-long or 30-second spots during the Super Bowl can cost millions of dollars, but brands still line up to get a prime spot before their competitors beat them to it.

Now, instead of retailers scrambling to secure ad time during a football game, imagine brands doing the exact same with eSports.

Actually, you don’t have to imagine very hard. Fortune reported that Activision, the publisher that holds the rights to the massively popular “Call of Duty” first-person shooter video game series, isn’t content to rest on its laurels — each successive Call of Duty game averages around $1 billion in sales. Instead, Sam Cooper, senior director for Call of Duty marketing at Activision, told Fortune that because games typically take anywhere from two to five years to develop, moving into the eSports world and interacting with past, present and potential future customers is a logical step in between releases.

“ESports is part of that engagement platform,” Cooper said. “We have a fan base that plays a lot of hours. We want them to play Call of Duty year-round. Building that community and driving engagement of the game is good for the health of the franchise. That’s a big part of where eSports is going for us.”

Cooper explained that Activison’s involvement in a professional and amateur Call of Duty competitive league will grow from $1 million in total prizes to more than $3 million during the 2016 season. The publisher is also partnering with Sony to livestream eSports events directly to PlayStation 4 consoles.

If throwing so much money and employee resources at video games is starting to seem foolhardy, take a look at the numbers behind the rise of eSports — a study from games market research firm Newzoo found that 204 million people either viewed or participated in an eSport event in 2014. By the end of 2015, that number is expected to climb to 226 million. The most popular eSports game, League of Legends, finished its year-long season on Saturday (Oct. 31) with an internationally broadcasted finals in Berlin, and while viewership data has yet to be released, 2014’s event drew 27 million concurrent eSports fans.

For reference, USA Today noted that that audience is three times larger than the 2014 Daytona 500, almost double the audiences of both Game 7s of the MLB World Series and NBA Finals and 500,000 more people than watched the 2014 World Cup from the U.S.

Yes — eSports is a thing.

That’s not news to brands like Coca-Cola that are used to engaging with consumers in a competition-style media format. Digiday reported that Coca-Cola and gaming news outlet IGN have partnered to create a “SportsCenter”-inspired show dedicated to issues and stories in the eSports world. Matt Wolf, head of gaming at Coca-Cola, told Digiday that the idea is to create a one-stop outlet for the millions of eSports enthusiasts to catch up on news — and interact with the Coke brand.

“We want to create a new watering hole for the eSports community,” Wolf said. “Something they can dig into, something that can have real reporting behind it, not fluffy pieces but interesting news stories … Hopefully, we have built a [strong enough] relationship with some of these fans where we get to come to the table and they know it’s not a transactional marketing play.”

Predictably, Coca-Cola has also established ties with League of Legends developer Riot Games, and Patrick Walker, vice president of insights and analytics at EEDAR, told Fortune that if Coke can make eSports advertising work, it could open the floodgates for other brands.

“It’s important that a major mainstream brand like Coke is sponsoring the event,” Walker said. “Riot is the market leader in eSports, so other companies use Riot as a proof of concept. If the Coke sponsorship is successful, many other major brands will be more willing to commit major money to tournament sponsorship. This sponsorship is a potential tipping point in the relationship between advertisers and eSports.”

It seems that all eyes are on Coke — except for the tens of millions already watching eSports.