Even though gaming has grown to become one of the most popular forms of entertainment in the last decade, many esports organizations, especially in India, still struggle to make profits. Even though esports viewership numbers have surpassed those of traditional sports in many countries, the average esports fan is known to spend far less money than a traditional sports fan. This is largely because the average esports fan is far younger and has less disposable income. Most esports athletes, gamers and fans remain unaware of how esports organizations make money and just how much they make.
Every business functions with the motive to make a profit one day, and so do we at Orangutan. As an esports organization, it is important to maintain multiple sources of revenue. To rely on prize pools solely cannot be enough as the profits can be minimal and unpredictable. So, what are the top 3 ways an esports organization can generate revenue? Let’s find out!
Number 3: Brand merchandise
Every esports organization that has a growing fanbase should seriously consider starting their own merchandise line, as that is the thing that brings their fans together as a community. Whether it is at a LAN, or a meet and greet, when your fans wear your merchandise, it is always a sign of a successful organization. Selling branded merchandise is also a great way to generate revenue through your shop. Selling fan jerseys, player signed jerseys, limited edition drops of caps, bottles, and other merchandise is a great way that esports organizations can generate a passive flow of revenue. You can even increase your product range by selling multiple kinds of jerseys, whether it is your home or away kit, a regular fan jersey, jerseys of each player that your organization hosts so that fans of that particular player can purchase them, and of course, signed jerseys which can be valued at a much higher price, depending on the numbers your player brings to the table.
Organizations like 100 thieves have severely capitalized on their own clothing line and have made their shop the primary focus of their website as well. In India, organizations like Soul have also done well with their merch line.
Number 2: Brand deals
Brand deals are another great way for esports organizations to generate revenue. These deals are not like traditional sponsorships that last for nearly a year. These deals can be for a much shorter period of time. For example: Orangutan has a deal with Hefty Games, which is a curated NFT platform for gamers where we have not labeled the deal as a sponsorship, because of the difference in deliverables.
Brand deals also need not be restricted to an esports organization, but can also be with certain players of the organization as well. However, through these individual player deals also an esports organization does make revenue as there is generally an organizational fee that is charged since the particular player signing the deal is a part of the organization.
Number 1: Jersey Sponsorships
The primary source of revenue for any esports organization is through sponsorships and brand partnerships. Just like any team, esports organizations also have their own jerseys which their players wear to represent the organization. These jerseys have spots which can be occupied by brands who wish to publicize their name to the audience.
At Orangutan, three spots on our jerseys have been taken by our friends over at Rooter and Cybeart, who are on the shoulders as our co-powered partners, and Fanclash on our sleeves who are our official partners. If taken into consideration, partnering with even a few brands can result in generating crores of rupees (INR) if the organization can back the amount they ask for with numbers, deliverables, and a healthy brand relation.
However, if your esports organization may be at a starting level, you do not need to feel demotivated and assume that you may not be able to bag a sponsor. All you need to do is either lower the amount that you quote for a particular spot, or even consider a non-monetary barter deal till your brand builds its value, which is when you can go out there and earn the amount per-spot which you feel your jersey deserves.
While you may be just starting off your journey as an esports organization, or could be an already established one, these pointers can certainly help you. If yes, then make sure to check out our blog on, “How to create an esports community?