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Fnatic x Nielsen Sports & Entertainment - The ROI of Esports

Published: 27 Jan 2022

All You Need to know about our new whitepaper with Nielsen Sports & Entertainment

Today, we’re revealing our latest whitepaper - The ROI in Esports - which we worked on in collaboration with Nielsen Sports & Entertainment, a world leading source of sports analytics and measurement that provide fan insights, media valuation and digital and social analysis to sport and esports properties.

------ Read the full report

But understanding the ROI in esports can be difficult to grasp. So, to outline exactly what this means for us, our partners and our investors, we’ve pulled together a Q&A to answer all of your pressing questions.

Why did you decide to collaborate with Nielsen Sports?

Nielsen Sports is an industry leader in sports measurement and analytics. They work with the biggest sports and esports brands in the world, rights holders and games publishers to teams and organisations. They help these organisations and brands better understand their businesses by evaluating and measuring their communities and fandom, sponsors and partners and digital and social channels.

Nielsen Sports is also renowned for its industry leading research and insights that helps those in traditional sports and esports industries optimize their commercial sponsorships and partnerships. This is exactly why we collaborated with them for this whitepaper - to fully understand whether partners are getting positive returns on their investment with us.

What is ROI?

ROI simply means Return on Investment. It is a widely utilised financial metric that many businesses use to understand how much return you can make from a particular investment. It's particularly important for brands who invest in sponsorship or partnerships with rights holders in sport and esports, as they want to ensure they are getting value for their investment.

That’s where Nielsen steps in. They have a methodology - which is recognised as a global measurement standard amongst the industry, built on robust and credible data analysis - to assess ROI. They uncover the true value of sponsorship activations by holistically evaluating the value generated through multiple touchpoints and engagements. This value is then divided by the partnership fee to generate a ROI factor.

Why is ROI important to Fnatic?

If you’re a fan of the black and orange, you’ll know that we’ve brokered some pretty big partnerships with the likes of ASOS, Crypto.com, BMW, Gucci and L’Oreal. To partner with Fnatic, companies need to make a financial investment into our organisation and these brands want to ensure they are getting great value for their investment. So, understanding the ROI of investing in Fnatic - as well as esports properties more generally - is valuable to us and everyone in the industry.

"This study proves what we at Fnatic already knew; that esports is pushing the boundaries of what partnerships entail for major brands, enabling all involved to generate mutual brand growth with leading ROI that continues to increase year-on-year. Esports is the vehicle of today and tomorrow that is helping brands connect meaningfully to Gen Z and millennials in a dialect they understand to build their affinity with these generations.”

George Mead, Partnerships Director at Fnatic

I’ve seen so many articles about the value of esports. What makes this different?

There is a lot of material online about the valuations in esports and it's certainly a contentious subject amongst the esports industry. So we specifically focused on one aspect of esports valuation - ROI of esports partners and sponsors - to ensure we concentrated on an area that is relevant to us and which we already have a very good understanding of. It’s also why we decided to collaborate on the piece of research with an industry leader such as Nielsen Sports, that have been doing this type of research and analysis for decades.

Who is the whitepaper targeted at?

The whitepaper is designed to ensure brands and sponsors are better equipped to understand the potential investment returns from engaging with top-tier esports organisations and tournaments. It also allows teams such as Fnatic to showcase their partnership potential to businesses.

Did you find out anything cool about esports and its fans?

The whitepaper revealed some interesting industry statistics about the industry and its fans such as:

  • Esports’ audience base is growing at between 10-20% per year and is driven by Gen-Z and Millennials that are digitally native, connected and engaged.
  • 73% of Gen-Z and millennials report using some level of ad-blockers, making them hard to reach
  • Esports is an always on proposition, driven by content that goes beyond just tournaments. We’ve seen demand for sponsored live streaming audiences across platforms like Twitch increase upwards of 98% since 2021

What were the top findings related to ROI in esports?

There’s a lot of interesting data in the report, with the study analysing the ROI of sponsors in esports against four key areas: media exposure and reach, activation and engagement, brand impact and business impact.

If you’re interested in reading it all, you can download the full report using the link below. However, some of the most interesting insights include:

Media Exposure:

  • The average Return on Media Investment (ROMI) for sponsoring Fnatic was higher (4.5x) than sponsoring high profile traditional sports events and teams.
  • The use of digital tools in esports can drive brand awareness comparable or better than in traditional sports. Esports offers significant benefits for brand awareness and exposure.

Brand Impact:

  • Sponsors generate positive sentiment amongst esports fans, with countries surveyed reporting between 51-58% positive fan sentiment.

Activation and engagement:

  • Leading LEC esports teams are growing their follower base at c.11% - 17.4% per year
  • On video content platforms such as YouTube, Fnatic (0.73%) outperformed most traditional rights-holders in the sport industry in terms of engagement, including F1 (0.38%) and Premier League teams (0.32%).

Business Impact:

  • Leading teams in the League of Legends European Championships (LEC) had more than doubled their ROI for their sponsors from 2019 (2.1x) to the present day (4.5x), as a result of the maturing ecosystem, growing audience and improvement of the esports product itself.

And did the whitepaper analyse any of Fnatic’s brand partnerships in depth?

It did. As part of the research, we provided Nielsen with unique insights into our partnership with  BMW. BMW has a long and successful history in sports sponsorship but wanted to expand into esports because it would allow them to connect with a new generation of people who do not consume media in traditional ways.

The partnership impact in numbers revealed that:

  • There was a 36% increase in BMW brand preference following the partnership
  • There was a 23% increase in top of mind Fnatic partner awareness
  • That the partnership achieved a total of 1.14M engagements relating to BMW branded content across all Fnatic social media platforms
  • That BMW branded content on YouTube in 2020 generated 4.95M views in total.

How will Fnatic and the esports industry benefit from the study?

This whitepaper provides both Fnatic and the wider esports industry with a benchmark for ROI in esports partnerships. It allows us to approach conversations with potential partners with facts, evidence and examples of how they can generate a good return on any investments they make and showcase why esports can be such a positive investment for them.

“Esports is evolving. The best esports properties are now 24/7 multi-platform content businesses offering an unrivalled number of opportunities for sponsors to engage with a typically youthful audience that can have higher and more positive engagement rates than traditional sports properties. Esports organisations such as Fnatic that have a strong and organic brand, which affiliate themselves with the biggest esports game titles and offer content opportunities through streamers and content creators, can truly deliver a positive ROI to sponsors.

Phelan Hill, Head of Strategy and Consulting at Nielsen Sports and Entertainment