How do esports venues make money? How much of an impact do esports events have on host cities? I sat down with Arena Consultancy’s Ben Akroyd to discuss everything to do with esports venues ranging from the location selection criteria to the various benefits, if any, of a venue hosting an esports tournament.
How Many Esports Arenas Are There?
There are probably less than 10 dedicated esports arenas globally.
“However, there are many more venues that, while not exclusively esports focused, are available for such events,” Arena Consultancy’s Ben Akroyd reveals. “Of course, whether or not these venues that promote themselves as being esports-ready actually know how to host esports tournaments is another question entirely. On the flip side, there are some phenomenal esports-ready locations that struggle to promote themselves and can be hard to find for both event planners and consumers. This is when a firm such as Arena Consultancy can often prove to be invaluable.”
What Are the Best Esports Arenas?
Judging which esports arena is the best really comes down to what you want to get out of it. “If you’re talking to someone who’s attending their first esports tournament at an arena, they’ll likely assume that’s the best one due to situational bias,” Akroyd explains. “However, if you ask a tournament organiser which esports arena’s the best, they’ll provide a completely different answer based on their own experience of delivering various esports events all over the country or even the world.”
Who Owns Esports Arenas?
Esports arenas are typically owned by video games publishers and the private sector. “We’re seeing more and more dedicated esports arenas being built in recent years,” shares Akroyd. “This is primarily due to publisher led tournaments insisting teams have their own homestead or home venue, where they can compete such as with the Overwatch League, and parties in the private sector investing funds into developing mixed use venues.”
One such example of an arena created by the private sector is the Sofi Arena in the US which has esports-ready facilities and also function as an NFL stadium. Another is the Northern Lights Arena Europe (NLAE,) a 3,000 seater arena being built in Dundee Scotland. It also boasts esports facilities and is partly funded by Dundee City Council.
What’s the Esports Venue Selection Criteria?
“Examples of esports venue selection criteria include broadcast time zones, facilities, technical infrastructure, location of player accommodation in relation to the venue, price, and venue availability,” explains Akroyd. “Selection criteria for esports venues is multi-faceted though and the key factors for venue selection will vary from project to project.”
How Do Esports Venues Make Money?
Esports venues primarily make money from the third-party tenancy.
“There may be scope for ticketing revenue if the venue has exclusive arrangements with ticket suppliers,” Akroyd elaborates. “However, most venues focus on the longer-term opportunities such as increased brand awareness due to being a venue that can host esports tournaments and the associated revenue from additional third-parties looking for locations to host esports tournaments.”
Are Esports Arenas Profitable?
Esports arenas can be profitable but, as will all business ventures, it depends. Akroyd explains.
“It really depends if the venues have mixed use facilities rather than focusing purely on esports tournaments. I always say that it’s important not to be too dependent on one sector for income when it comes to this sort of thing. Venues that can host a variety of different events have greater revenue opportunities.”
Who Hosts Global Esports Games?
Global esports games are hosted by both games publishers and tournament organisers developing their own IP with the blessing of the publisher of the game or games they’re featuring. “Blast are an independent organisation who run CS:GO tournaments with the blessing of Valve (the publisher of CS:GO),” explains Akroyd. “Conversely, the publisher EA may run their own FIFA 23 tournaments and similarly Epic Games can put on their own Fortnite World Cup. It really depends on the game and the publisher’s appetite for esports and allowing third-parties to use their IP.”
How Much Does an Esports Host Get Paid?
How much an esports host gets paid depends greatly on the duration of the tenancy says Akroyd.
“Revenue can be substantial given the tenancy requirements. It really depends on the tenancy duration which can vary from a couple of days to several and on weekdays to also weekends. For example, some tournament organisers need a full tenancy for a Friday to Sunday live day experience.”
What Impact Does Esports Have on Host Cities?
Hosting an esports event can benefit a host city both financially and in regards to reputation.
“Like a popular sporting event, a major esports festival can attract tens of thousands of people who travel to the host city via road, rail, and plane and stay in hotels close to the venue,” Akroyd reveals. “All of this equates to a significant and positive economic impact on the host city with some reports suggesting that esports fans add 40 times the cost of their event ticket to the local economy.
“The impact on the city’s brand reputation can also be significant. Being associated with esports can help drive the local digital economy which in turn can lead to an uptake in related technology and esports courses being taught and the development of the local talent pool as has been seen in Atlanta and London.”
What Impact Does Esports Have on Society?
Esports is having an impact on society though the situation isn’t as black and white as most would think.
“Some would say that time spent in front of a screen for recreational purposes is wasted time and that younger people should be encourage to spend time outdoors,” Akroyd admits. “However, in my opinion as a parent, time playing and watching games simply needs to be balanced just as it would with any other recreational activity.
“From a professional standpoint, esports is now being recognised and respected to the same degree as more traditional sports and being a pro esports player is now a commercially viable career path that many gamers aspire to follow.
Which Country Is Leading in Esports?
No one country is “leading in esports” as a growing number of tournament organisers continue to look for fresh territories to consider for their live finals.
“Different markets are emerging due to a variety of factors,” Akroyd elaborates. “Two examples of up-and-coming esports countries are Peru and Brazil. Lima, Peru has just hosted a DOTA 2 major which has put them on the global esports map while Brazil, has a high large number of (amateur) CS:GO players which led ESL (a tournament organiser) to host the Rio ESL One (CS:GO) tournament event there in 2019.”
What Are the Benefits of Sponsoring an Esport Event?
Sponsoring an esports event gives brands an opportunity to reach a wide audience as part of a tournament’s live streaming broadcast.
“Many esports tournament organisers typically look for three tiers of sponsors; a broadcast platform that can offer them as large of a viewership as possible, endemic (games industry associated) sponsors to appear on the stream as a commercial partner, and non-endemic (sitting outside of the industry) brands looking to reach ‘Gen Z’.”
What Are the Benefits of Esports Marketing?
Esports marketing gives brands an opportunity to reach audiences that normally aren’t exposed to traditional media. Some brands may elect to sponsor an entire esports tournament while others may strategically market within the video game itself.
“For example, Intel are the naming rights sponsors of the Intel Extreme Masters (IEM) that is a CS:GO tournament delivered by ESL while the Fortnite video game hosted an in-game digital Ariana Grande musical experience which was seen by both participating players (over 10.7 million) and those watching broadcasts of the event.”
Ben Akroyd is an award-winning event director with over 25 years of experience in the esports and gaming space. He’s organised events for major brands such as SEGA, Ubisoft, Red Bull Gaming, and numerous others in Mexico and all across North America and Europe. Ben prides himself on his industry knowledge and close relationships with numerous national venues from the SEC and Queen Elizabeth Olympic Park to ExCeL London and Twickenham Stadium.
Work with Ben when planning your next esports event by sending an email to hello@arenaconsultancy.com or calling +44 7899 962 423 today.