Brands look for name association with esports organizations

By Kevin Hitt

Esports’ arrival on the scene of the mainstream entertainment space this past year was largely due to its adaptability to the effects of the COVID-19 pandemic. While traditional sports and other events were being shut down, canceled or postponed, esports filled in for gaps in production on cable channels such as ESPN and Fox Sports. And now — after witnessing the electric growth of the gaming industry and subsequently esports — brands and investors are looking to make their mark in the industry by negotiating naming-rights deals with esports organizations.

 

While naming-rights deals in traditional sports can include teams — such as Michigan State, whose men’s basketball team now goes by “MSU Spartans Presented by Rocket Mortgage” — there is other inventory available, such as stadiums, arenas and other facilities. For most organizations in esports, team-name branding is the most valuable inventory it has.

TSM FTX, formerly TSM, made waves not just across esports but the entire entertainment and esports spaces in June when it signed a 10-year, $210 million deal with FTX, a cryptocurrency exchange company.

“We know that esports is a digital-first product,” said Andy Dinh, founder and CEO of TSM FTX. “It’s a very exciting time for esports at the top levels.”

Esports organizations such as TSM FTX are making naming-rights deals that are of a depth and scope comparable to that of professional sports teams.

According to Dinh, at any given hour in a day, there are 25,000 fans either watching TSM FTX compete or stream content. He says they have the numbers to support the deal in place with FTX.

“If you go to a football or basketball game, you’ll see a crowd of anywhere between roughly 30,000 and 70,000 people that can see all the branding and advertising,” said Dinh.

Crunching those numbers, TSM FTX reaches approximately 600,000 people a day across all of its social media platforms in all countries. The NBA’s Miami Heat, which signed a naming-rights deal earlier this year with FTX to call its home FTX Arena, had a total of 805,264 people come through the gates for their 41 home games during the 2018-19 season (before COVID-19).

However, the reach of branded NBA arenas goes far beyond physical attendees, as the brands are exposed to millions through regionally, nationally and internationally televised games. FTX is paying $135 million over 19 years for the deal with the Heat.

The TSM FTX naming-rights deal is by far the biggest, but not the only one of its kind. Esports organizations NRG Esports, which counts Shaquille O’Neal, Alex Rodriguez and Jimmy Rollins among its ownership group, recently partnered with insurance company The General to rename its Rocket League team The General NRG. JDG Gaming, the esports offshoot of the Chinese e-commerce company Jing Dong, signed a deal with Intel in June, and is now known as JDG Intel Esports Club.

As esports continues to capture the most profitable demographic (18- to 34-year-olds), brands are going to want to be front and center, especially with the industry proving that it can weather challenges such as a global pandemic.

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