The Sports Events Blog by co-editor Ramy Salameh
The Covid-19 pandemic will reignite the many questions around the “risk vs. return-on-investment” when hosting major sporting events and whether destinations will be reticent to bid in the future.
Tokyo’s Olympics and Paralympics have now announced a postponement until July 2021 and the economic implications for Japan are yet to be fully realised based on this deferment.
However, could the esports industry provide some form of safety net and a major new opportunity to help balance the books of major sporting festivals of the future?
The discussion has been on the table for a few years now. So much so, that esports may well be on track to be included as a demonstration event, to run prior to and in conjunction with the 2024 Olympic Games in Paris.
With the current Formula 1 calendar in turmoil, the sport was quick to announce the launch of a new F1 Esports Virtual Grand Prix series.
Starting with the Virtual Bahrain Grand Prix on 22 March, the new initiative allows F1 fans to watch some form of racing. Yes, it’s for entertainment purposes only, rather than championship points, but who knows where this might develop?
$1bn industry
The esports industry has seen stratospheric growth for more than a decade, moving from a peripheral niche player into a mainstream activity, now sitting alongside traditional sports on some broadcaster channels.
Today, esports, gaming festivals and expos are springing up all over the world and according to the Global Esports Market Report 2020 global esports revenues will grow to $1.1bn this year.
Without doubt, amid the chaos created by the current coronavirus pandemic, the esports industry will suffer like every other sector. However, by the very nature of the huge online communities, some aspects will remain unaffected.
Indeed Covid-19 could be seen as a vehicle to get more entrants into the online sports sphere, with so many people isolated or quarantined at home. And therein lies the power of the esports industry, the ability to reach outwards, engage with huge audiences at an accelerating rate whilst growing into new territories and all predominantly in cyberspace.
So, if we really think out-of-the-box, could esports be the new kid-on-the-block to justify destination bids to host major events of the future? And could the impact of Covid-19 enhance the relationship between traditional and online sport?
My thoughts are yes absolutely, based on the sector’s innovative technology and truly global outreach to a young tech-savvy audience able to engage from any location. So, in the rare circumstance a sporting event has to be postponed or cancelled, there just might be a virtual interim solution.
It’s in the game…
For those people who do not follow, participate or see any overlap between mainstream sport and eSports, they may be surprised to know just how many major sports teams and brands already have e-gaming teams/leagues or interact through sponsorship.
Or indeed how far down the line that fusion has come; global federations, clubs and brands are all identifying the potential of esports to communicate with generation Y and Z. The average age of an esports fan is 26 with the youngest proportion (85%) of fans under the age of 35.
In 2020, $822.4m in revenues, or 75% of the total global market, will come from media rights and sponsorship, according to the Newzoo market report.
Also, the total esports audience will grow to 495 million people in 2020, a year-on-year growth of +11.7%. Brands that have investment into esports sponsorship include Pepsico, Anheuser Busch, Mastercard and Louis Vuitton.
The world of football seems to be ahead of the esports curve, largely related to EA’s FIFA franchise managing the flagship “FIFA eWorld Cup” and associated tournaments, an investment into the sector stretching back to 2004.
Nowadays, the likes of Manchester City, West Ham, FC Schalke, FC Copenhagen and PSV Eindhoven are amongst many clubs with their own e-teams competing in leagues and competitions.
Key element for event bids?
How might Covid-19 initiate new conversations within the sports tourism world? Whilst nothing can replace the “live” spectacle of a major sporting festival like an Olympic Games, the postponement of Tokyo 2020 and the complex issues that has now raised, fuels the need for a closer relationship with the esports industry.
Thus, the esports sector may hold several key advantages; firstly, this style of competition can be managed remotely, whilst still attracting huge online audiences worldwide.
Secondly, if the event is postponed, it provides the host nation and federation a new interactive online platform to provide fans with a continuing narrative and engagement with the event; such as watching virtual competitions, exactly as Formula 1 is doing right now.
Thirdly, and of critical importance, it can provide an outlet for sponsors and stakeholders to maintain awareness and engagement through the online channels and virtual competitions.
The potential for events to add a specific esport dimension, could become a requirement for major sports festival bids, especially if the legacy can continue to bring esports fans to their region.
What may sound far-fetched, may already exist in some form and provide a blueprint for other destinations.
It was reported by siliconcanals.com that Eindhoven in the Netherlands is the world’s first city to get an “active esports arena” for real virtual experiences with participants using their body as a controller – the clearest example of the crossover between esports and traditional sports.
Destinations are waking up to the esports/gaming revolution and all the opportunities it holds.
The unprecedented upheaval caused by Covid-19, is already questioning how we will work in the future, how we will engage with each other and how to cope if we experience something similar.
Tokyo 2020 highlights the fragility and risk as a host destination, but esports and gaming may well provide an interim solution, it is at least food for thought.
Watch this virtual space…
Main image: 2020 F1 Bahrain Virtual Grand Prix (Formula 1/YouTube)