Sportswear Brands Still Competing in Asian Esports

COVID-19 has had a big impact on global esports revenues. Newzoo predicted in July 2020 that revenues for the esports industry worldwide would increase by 1.7% this year, compared to growth of 23.3% year-on-year in 2019. Sales of esports merchandise and tickets—Newzoo tracks the two revenue streams as one segment of the total industry—will take a big hit, according to the researcher’s latest forecast, declining 27.2% this year versus last. This is due primarily to a steep drop in ticket sales that naturally follows the cancellation of live tournaments.

At the same time, however, viewership has spiked during the crisis. Not only have existing gamers and fans had more time to spend on the activity, but many consumers looking for alternatives to live sports during their COVID-caused hiatus checked out esports for the first time. Hours watched on Twitch—the main U.S.-based esports streaming platform, commanding more than two-thirds of total hours watched—rose 70.3% to 4.9 billion in Q2 of this year versus Q1, according to Fnatic Insights: Esport COVID Update. And the number of average viewers increased by the same percentage, to 2.3 million. Twitch competitors YouTube Gaming and Facebook Gaming saw big bumps as well. These growth rates came on top of already solid increases before the pandemic.

Asia is the biggest esports market, generating nearly 50% of all global esports revenue in 2019, according to Niko Partners. The region accounts for 54% of global esports players (a total of 595 million) and boasts 510 million esports fans. During the COVID crisis, Niko estimates, Asian viewership of esports streams increased by 75% to 100%, while 50% to 75% of Asian gamers spent more time playing. The top Chinese streaming platforms for gaming include HUYA, Douyu, and Bilibili, the last a YouTube-like gaming content channel.

It’s not a surprise, then, that Asia has been an active territory for esports merchandise deals and drops of late. Several of the news items that have come to light related to esports merchandise in the past two months have focused on Asia and involve the biggest global sportswear/footwear brands, all of which had been increasing their participation in esports before the pandemic started. For example:

• Puma paired with Gen.G for a limited-edition range of jerseys for the League of Legends 2020 World Championship, to be worn by Gen.G’s League of Legends Champions Korea (LCK) team. The jersey features artwork by American artist and fashion designer Heron Preston. This is the first collaboration between Gen.G and Puma, which announced in June that they would partner for new merchandise, collaborations, and experiences. This first round of merchandise will not be available for purchase, although jerseys are being offered as prizes in a social media contest tied to the Championship.

• Nike dropped its latest collection with the League of Legends Pro League (LPL) in China, also in conjunction with the World Championship. It created a collection to be worn by the four teams that will represent LPL China in the tournament, including Top Esports, Suning, JD Gaming, and LGD. Nike and LPL announced their merchandise partnership in February 2019. Last year, Nike supplied merchandise for three other LPL teams—Invictus Gaming, Fun Plus Phoenix, and RNG—for the Worlds, and it outfitted all of its teams for the 2020 season. The brand also just dropped a “Good Game” collection for the LPL, which includes a sweater, two hoodies, a t-shirt, and five pairs of shoes. Separately, Nike paired with T1 Entertainment and Sports, a Korean esports organization that operates teams across several gaming platforms, in a deal announced in January of this year.

• Team SMG of Singapore announced a one-year deal with Under Armour to outfit all of its players in Malaysia and Singapore and offer lifestyle apparel. It has two teams based in Malaysia that compete in contests centered on the mobile titles Mobile Legends: Bang Bang and PUBG Mobile and a team based in Singapore focused on Riot Games’ Valorant. Under Armour also has had a licensing deal since 2018 with Tencent in China, producing merchandise for the King Pro League, which is focused on Honor of Kings.

Other global sportswear brands are similarly involved in the Asian esports market. They range from Kappa, which earlier this year released its first team jerseys for Royal Never Give Up, a Chinese organization, and its Dota 2 team, to Adidas, which first moved into the esports market in China through a December 2018 deal with Lyon EDG, a FIFA Online 4 team.

Esports organizations’ agreements with these apparel and footwear giants fit with the collective plans of the Chinese esports industry and its major organizations and teams, many of which are hoping to expand beyond Asia and position themselves as global brands.

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