November 26, 2020

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ESI Digital Summer presents: Regional Esports Market Report – North America

In anticipation of ESI Digital Summer (#ESIDIGITAL), presented by Kinguin LOUNGE, Esports Insider spoke with...

In anticipation of ESI Digital Summer (#ESIDIGITAL), presented by Kinguin LOUNGE, Esports Insider spoke with many of our esteemed panelists, partners, and presenters attending the conference to share their perspectives of the unique regional esports scenes represented during the digital conference.

Digital Summer is the second digital event in line this year for ESI and will be the biggest esports industry event of the year. Join us August 17-21th for five consecutive days of content, wherein each day will focus on a different and important regional market for the esports industry. 

To make reading up on the global perspectives from industry veterans and developing brands easy – we’ve broken up the conversations into regional entries, following the itinerary of ESI Digital Summer.

Each entry also features a shortlist of regional opportunities and challenges – gleaned from our conversations – and employment data powered by Hitmarker. These are not meant to be exhaustive, rather to provide context for each region from the perspectives of some of the industry’ finest.

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Regional Esports Market Report – North America

The Opportunities

  • Accessible capital and brand awareness
  • Built-in worldwide audiences
  • Rapidly developing collegiate ecosystem

The Challenges

  • Good on paper, but often underperforms
  • Few gaming and esports hubs among vast deserts of opportunity
  • Disparity of audiences, gamers, and infrastructure

Employment Data – Powered by Hitmarker

  • 50.18 percent of total global market share of newly-posted jobs in July

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Introductions

Esports Insider held conversations with Tricia Sugita, CEO of FlyQuest, based out of Los Angeles, California, USA, and Christie St. Martin, CEO of Gamers.Vote, based out of New York City, USA; representing opposite coasts of the States and different initiatives operating within the North American esports market.

FlyQuest is an esports organisation with a vision of being more than just an esports organisation. “Showcase Greatness” is the mantra surrounding FlyQuest’s operations within the space. Alongside its environmental awareness, fights for equality, and personal development initiatives, the organisation fields a League of Legends team competing in the LCS.

Gamers.Vote is a nonpartisan, non-profit organization that encourages and supports the act of participation. Leading a coalition of various organisations as a unifying brand to make voting a priority. Featuring partner activities such as individual streams, brand integrations, esports tournaments, team activations, all targeted to activate the gamers and esports audiences.

Representing very different organisations operating within different areas of the market, while sharing social movement initiatives – Sugita with over a decade of experience in esports, from a competitor to streamer to onscreen personality up to the C-Suite with her business acumen in operations. St. Martin comes from over a decade of robust social media, marketing, and product-launching background through a variety of industries.

They both offered insightful and varied perspectives on the North American esports landscape and our conversations will hopefully inform those who would like to learn more about the various opportunities and challenges in the region.

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Overview

Many panellists spoken during this series expressed Europe and North America as a benchmark, serving at least in popular opinion as the tier-one of esports organisations and businesses. Many panellists from Europe shared their opinions of various facets of their operations that would be easier if they were geographically located in the states.

Many of these concerns had to do with having clients and customer bases in North America, timezones complicate communication, as most likely all globally-minded esports businesses would agree. Richard Huggan, Managing Director of Hitmarker, shared that because of the time differences between North American and Europe, the radio silence that happens when the Hitmarker team is offline but North Americans are still awake isn’t ideal for his company.

The perceived size of the North American market does lead many out-of-region companies to feel that they must bend over backwards to access the attention of a market significantly saturated with plenty of local companies. The perceived-consumer power of the North American market precedes the region and likely is a result of the North American dominance of global media coming from Hollywood.

However, the reality is that it is not the land of esports milk and honey, while there is much more access to the all-important capital, the competition is fierce and capital is no guarantee of success, as many organisations have discovered. While many outside look up to the region’s high valuations, high-quality productions, and hype machines – many within the region rarely see past its borders to what others are doing abroad.

With such enormous landmasses contained by Canada, the United States, and Mexico, the differences between the areas with esports-haves and have-nots are vast. Similar to Europe, tech hub cities also foster thriving gaming hubs. And while a range of clubs and cities are represented in the various esports leagues, many North American cities might not enjoy any global, regional, or even local acknowledgement for their efforts.

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The Opportunities

Accessible capital and brand awareness

Jonas Gundersen, COO of Ninjas in Pyjamas, spoke about his previous work experience in the U.S. and stated that the speed in which organisations can scale is not possible in Europe. Access to capital, large markets, and the ever-increasing brand awareness of the space makes it much easier to grow and move into large regional markets in the US.

UK-based Huggan longingly shared that the company had plans to make the rounds to many US-hosted conventions this year that have been thwarted by the pandemic. He expressed that trips to the US can be preventatively expensive for many outside of the region, which is less of an issue for organisations that can take advantage of domestic travel prices.

Built-in worldwide audiences

St. Martin shared that many of the world’s globally-popular brands and esports publishers have their global headquarters in North America, capturing the attention of global fans toward the region with everything they do. Given that many popular esports coverage sites are in English, messaging is easy to share to a swath of audiences. Sugita also agreed that the North American esports scene benefits greatly from Riot Games’ locality.

St. Martin continued, “The US has tremendous potential from a consumer (and) integration perspective. The sheer number of interested brands and programs allow for almost unlimited opportunities for engagement.” Although this potential has taken a hit due to lockdowns, she acknowledged, the ability to introduce brands to the esports audience through a live event was a game-changer.

The benefit of having these publishers in their own backyard is not lost on many esports companies. There are dozens of events, tournaments, leagues, and activities that are region-specific and often global flagship events. Los Angeles is the esports hub that it is thanks to its perfect storm overlap of entertainment, technology, and gaming industries, not easily replicable in other locales. 

Rapidly-developing collegiate ecosystem

St. Martin shared, “In the US, we have a robust high school and collegiate competitive programs and the opportunity to engage (in) esports is second to none. Schools, brands, and fans know how to operate and connect in the space. Esports can and will benefit greatly from similarity designed school-based programs.”

While many players in the space have thrown their hats in the ring and the jury is still out which model will take the day, there is a looming fear that the National Collegiate Athletic Association could strike at any moment to flex its stranglehold on the traditional collegiate sports space. Despite these concerns, the academic and collegiate scene of North America is rapidly-developing with the introduction of many leagues, programs, scholarships and organisations – all which could lead to untold opportunities in the near future.

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The Challenges

Good on paper, but often underperforms

Sugita shared, “North America has historically underperformed in most esports, whether it’s Starcraft, Dota, League, CS, etc. I say underperformed because on paper it looks like we should be doing much better given our resources and public perception. We get memed because we look like an A but ultimately end up performing like a C in international competition.” While the region in popular perception is a mecca of esports and opportunity it often falls short of what it is expected to produce in terms of competition.

She continued, “The level of competition is fierce. And before everyone starts memeing NA, I’m talking about on the organizational (sic) level as a whole.” With every organisation swinging for the fences on everything they do and huge investments not under everyone’s belt, the playing field is vastly different at an organisational level.

“The other LCS orgs have a considerable amount more in terms of resources and reach, with multiple titles and all sorts of influencers, streamers, even studios. So to compete with the ‘big teams’ for fans is our biggest and most important challenge at the moment.” Sugita finished, echoing the sentiment that while the competition is fierce in the scene, it’s just as fierce in the region’s industry.

Few gaming and esports hubs among vast deserts of opportunity

As referenced below in the employment data figures, there are clear abundances of opportunity in the gaming and esports space and thus famines tied to locality. This also rings true for organisations trying to target an audience, leaving non-gamers and esports fans feeling left out of the fun when most of the action takes place in select cities, leaving entire swaths of the population untouched by esports and by association brand opportunities.

Huggan shared that to fly to California for a convention or event is a huge commitment and investment for many non-North American companies, sometimes underappreciated by those within the region. The same sentiment is shared among others that live on the wrong coast or area for esports events, the action and attention isn’t at all evenly distributed.

Disparity of audiences, gamers, and infrastructure

While many gamers in the U.S. are divided by console or PC, the disparity goes far deeper than that. Polarised by the current state of the continent, the region has been obsessed with picking sides. Making this an especially difficult environment for non-native brands to approach. There’s the still long-standing argument still present over whether esports are sports and the general gamer opinion of what is good and what isn’t, making the scene a minefield to enter for outside brands.

St. Martin offered that beginning with school integration and activity, the space could use the attention as a starting point for progress. “Brands can serve as they do with traditional sports and really amplify the efforts at the high school/college level. Esports programs starting in high school and encouraging students to consider unique passion led opportunities into collegiate programs can open future doors beyond competitive play.”

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Employment Data – Powered by Hitmarker

During Esport Insider’s conversation with Hitmarker’s Managing Director, Richard Huggan (featured in the Europe-focused entry of this series), he shared regional data from the premier English-language esports and gaming job site. You’ll find these insights in each respective entry of the series.

Employment Data powered by Hitmarker -North American

North America dominates the listed job opportunities category of the site, numbering 1,699 new listings – 50.18 percent of the total global number – but slicing the data thinner by state, reveals the disproportionate reality of esports opportunities in the region.

At the time of our conversation, just shy of 1,300 of those listings are hiring out of California and yet only 293 of them are specific to esports roles. This helps illustrate the stark contrast of gaming and esports oases and deserts in the region, for just how big it is, there certainly are areas with haves and areas with have-nots.

Canada’s own 293 job listings on the board offer only 17 percent of North America’s total regional jobs.

The top five companies hiring in the region, according to Hitmarker’s data from March 1st to July 31st, are: Electronic Arts, Riot Games, Blizzard Entertainment, Ubisoft, PlayStation.

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Final Thoughts

As many of the panellists from outside the European and North American regions shared the perceptions that the regions are tier-1 in terms of esports and gaming landscapes. The audience potential of the North American market isn’t an understatement, combined with the brands-based out of the region and the capital available, it isn’t hard to see why North America is such an attractive market – however, as the saying goes, “Heavy lies the crown.”

With great access to resources comes with great responsibility – and competition. With such high valuations and thus stakes, capitalism has its mark in the North American esports industry, undoubtedly. Organisations fit into this model may have a difficult time operating outside of the region, but the reputation that precedes them may make it worthwhile for them to expand into different regions.

But on the other hand, given all the attention the region gets from all over the world, it may not be that necessary for organisations to spread their resources into other areas. The jury is out whether the money poured into the North American esports industry will see proportionate returns considering lesser valued regions perform just as well, if not better, on the competition side of things.

However, there are organisations that attract attention and use their audience for good, shares Sugita about FlyQuest. From a recent podcast episode with Esports Insider’s Adam Fitch, Sugita wanted to be clear with FlyQuest’s platform, “We want to win. Of course, our goal is to make Worlds. That will never change, what we are will never change. What we are is a competitive esports team.”

She continued, “But, why we do the things we do, I think that is what FlyQuest (has) clearly defined. Why we do our #GoGreen initiative, why we compete in the way we do (sic), We are creating TreeQuest and SeaQuest and doing these campaigns. Because at the end of the day, we believe that greatness exists within everyone and we want to help them find and showcase it.”

St. Martin’s Gamers.Vote has a similar goal, as an agnostic bi-partisan non-profit organisation. The defined goals are to promote democracy to its audience of gamers, to establish its empowering coalition of organisations under a unifying brand to bring its message to the masses of gamers to act. Nothing to do with winning or losing, but focussing on enabling change to the things that matter.

Be sure to catch Sugita and St. Martin speak during ESI Digital Summer during the North America programming on Friday, August 21st.

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