Operators need to get smart with esports

We’re coming to the business end of the season in one of the world’s biggest sporting events with the Champion Series playoffs seeing hundreds of thousands watching every match online. So it might surprise you to learn that only a handful of bookmakers are offering odds on it.

The sport in question, of course, is the League of Legends, the granddaddy of esports, and its Legends Champion Series is proving there is still a real disconnect between the two worlds. Online gambling and esports fit together beautifully in theory, with many fans already wagering on the game through ‘skin betting’ sites. But in practice the fit is less cosy.

Betway is arguably leading the charge with a microsite full of esports content and pitched squarely at this new breed of millennial customer. Its esports betting section sits in a separate tab, between Vegas and Casino, and features blog content and markets on most of the major games: Dota 2, LoL, Starcraft 2, CS:GO and World of Tanks.

Sky Bet’s Betgenius-powered offering is comprehensive but others are still just dipping their toes into the water. The market is presented in a broadly similar manner to other sports, including bet365, Ladbrokes and Betfair who all have a broad range of betting opportunities but very little else to draw in the millions of esports fans.

Brute force approach

At the moment the approach feels quite blunt, with operators not yet adjusting to this very different demographic. And in a competitive environment where there is an increasingly brutal fight over the core betting audience, it bears repeating what an opportunity these engaged esports fans represent for a sector that always needs fresh blood.

League of Legends World Championships in October drew concurrent online streaming audiences of 4.2 million. That’s not 4.2 million vaguely watching a TV broadcast, that’s 4.2 million people actively engaged with a show streamed over their computer with instant access to your product.

Typical audiences for weekly games or in other esports events are far lower, but the key attributes remain solid. And you only need to take a glance at something like https://csgolounge.com/ to see how active the grey betting market already is on some of these events. But how does the “traditional” online gambling industry get involved?

The temptation is for operators to plough time and resources into creating content designed for esports viewers, such as blogs, podcasts, webcasts and live streaming. That latter is a key proposition for at least one supplier to the industry, but with availability so widespread on the internet you have to question the value for betting operators here.

Presentation will be crucial though, not just in terms of site design but also in how the odds are displayed and how the betting markets are offered. Perhaps also a lesson can be taken from Sky Bet’s rapid ascent, with media partnerships and co-branding likely a strong route to capture the attention of the esports crowd. Operators don’t need to own the space, they simply need to be authentic and visible.

Carving a niche

But there are also opportunities to create niches within gambling, perhaps through smaller sponsored leagues or unique events. One interesting route along these lines is the recent launch of the Global Poker League, a poker tournament series presented very much on esports lines. Backed by serial egaming entrepreneur Alex Dreyfus it launched this week with a series of live-streamed matches.

Dreyfus sees sports betting at the heart of the GPL offering and BetStars is already offering odds on the matches, as you would expect with so many Team PokerStars Pros involved. But this synergy of betting and esports could be a strong test ground for other operators wanting to test the boundaries of what they can do in the space.

With such a rapidly emerging industry there is an opportunity to innovate around presentation and how betting is presented to a millennial audience on a small scale before the whole thing blows up. With Eilers Research noting in a recent presentation that in 2015 there were 265 million viewers watching 241 billion minutes of content the opportunity is as obvious as it’s massive.

Skin betting is already estimated to be around $5bn in annual turnover, although revenues are harder to come by. But traditional betting is where the action is going to be. Total turnover on esports betting in 2015 was $300m according to Eilers Research, but is predicted to rise to $10bn by 2018. That’s a game nobody can afford not to play in.