Since I was born (I think) there’s a common sentence inside the marketing and comms business: gaming is bigger than movies. I bet you heard that at least one time in your life, but it’s really hard to assume that as an unquestionable truth. Games like Call of Duty do make a lot of money and produce larger revenues than the big movie studios, but has the gaming industry reached its full potential? Thing is: with the help of esports it might.
I know, I know. Games and esports are different things. But when it comes to huge companies it’s still easier to explain esports as a gaming competition. We can discuss those differences (with which I agree) in the future, but today I would like to discuss the real size of esports in Latin America–or to be more specific, in Brazil.
In recent years, huge brands like Coke, Mastercard and Dell have spent a lot of money in this industry. Do we live already in a business era starred by esports or this is still a brand new market when compared to movies and TV series? Will this market be as big as the phrase I have heard since I was a boy or will this always be only a promise, a potential never fully reached?
To better understand this potential, I met with Tiago Xisto, CEO at Vivo Keyd, one of the most popular teams in Brazil’s esports scenario. Before jumping in the gaming industry, Xisto was involved with marketing and advertising at Wundermann and other agencies in the city of Sao Paulo.
How do you see the evolution of esports in the Brazilian market in recent years? Sure, we have brands that invest big money in it, but we can see a lot of companies saying that the return is still not as expected. What do you think?
Investments have been growing year over year. And now we live in a moment of non-endemic brands looking for opportunities in this ecosystem. Sponsorships are a type of media that needs to be very well planned and executed. Exposing the brand in a uniform is no longer enough. Marketing managers are looking through esports for a way to reach their KPI’s and communicate with a highly engaged audience.
Talking about streaming and championships’s broadcasting. What stage do you think the esports market in Brazil is at? Is it mature enough today to invest and be positioned as one of the greatest in the world?
We have large publishers in Brazil that invest massively in production and transmission of championships. We can mention Riot Games and Garena, which in addition to digital broadcasting on platforms like Youtube and Twitch, are also retransmitted on cable. And it is worth mentioning that the biggest live streams on Youtube Brazil are from gaming championships. The attendance of these tournaments is immense and much larger than many traditional sports. The key thing here is the brand to always be well advised and do good research about the audience and about the game to find out the best way to be out there. Whether it is through a club, an influencer or championship. There is room for all strategies.
What about these new companies betting in the streaming world? Facebook invests a lot in it, YouTube is in a partnership with Blizzard, and Twitch is growing quickly, but we always see new players coming. Do you think there is room for everyone or will there be a domain of these great names?
In addition to the ones you mentioned, there is also the Asian giant Nimo TV from Huya, which received investment from Tencent, and also Booyah from Garena itself, which recently started its operation in Brazil. For me Facebook‘s strategy was not the best in Brazil. Their gaming division was unable to sustain itself in the medium term. A breach of contract with several influencers has already been reported and that is weakening their reach power.
This is just an example, cause I think there is a lack of long-term planning and deep strategies for creating communities on the platforms. For a long time Twitch sailed alone in this market but was unable to establish itself as a great reference, giving scope for other players to grow in Brazil.
So, what does an ideal platform for the consumer looks like? And how can this platform monetize with this public used to consuming on the Internet for free?
First: be clear and transparent with content creators. Have incentive programs so that medium and small streamers can become professional through the platform. Engage communities. Being close and paying attention to the news in the market (launching games, fairs and events) and being able to monetize on top of that. Build strong commercials departments that can decode the language of these communities for a brand, creating products and projects to monetize this audience.
Today, entertainment goes through a streaming revolution. Do you think games will have something similar or will it always be different?
I see expansion. In the near future we will have championships on public TV, purely and simply for the audience that these tournaments have. It is the future of entertainment and I speak of a market much larger than that of music and that of Hollywood, which is not yet being explored in its real potential.