Traditional sports have an esports problem


Professional sports leagues like the NFL and the NBA are about to face a major challenge called “the march of time.”

Young Americans, or “millennials,” (the generation that was born from the mid-1980s through the early 2000s) are split in terms of their loyalty to traditional sports and competitive video gaming, according to an LEK Consulting survey. While 18 percent are undecided, 40 percent of millennials prefer esports compared to 42 percent who still favor old-fashioned athletics. A variety of factors can explain this parity (such as the rise of smartphones, the free-to-play business model, or Twitch), but whatever the reasons, LEK points out that established sports leagues officially have a millennial problem.

“Though they represent a large and increasingly integral segment of the U.S. sports fan base, millennials bring to the table a unique challenge,” LEK managing directors Alex Evans and Gil Moran write in the survey. “Unlike their Baby Boomer and Gen X predecessors, millennials follow a much broader range of both traditional and alternative sports as adults, and despite having less time on their hands, have a far greater selection of viewing alternatives.”

LEK is measuring interest in sports and esports, but this doesn’t suddenly mean that competitive gaming is as large as the NFL. Pro gaming events will generate $696 million worldwide this year, according to an estimate from industry-intelligence firm Newzoo. That’s a fraction of the billions that the NFL, the NBA, and the MLB make, but esports revenues could catch up quickly as the Millennial generation overtakes older demographic segments as the biggest spenders over the next two decades.

“In terms of both composition and dollars spent, individuals 35 and older continue to dominate the country’s consumer base,” Evans and Moran explain. “However, at a combined 45 percent, millennials — ages 17-34 — and their Generation Z peers — age 16 and under — are quickly closing the gap. Millennials alone now represent over a quarter of all domestic consumers, and they are the country’s leading life-stage demographic.”

So young Americans are growing in importance as they begin to earn and spend more. That makes sense, so what’s stopping NFL commissioner Roger Goodell from using some of its savings to go after the next generation of fans? Well, millennials and Gen Z might have viewing habits that are incompatible with the current business model for traditional sports.

“Coming of age during the rise of the handheld, these individuals have established media preferences that stand in sharp contrast to their Boomer and Gen X counterparts,” reads Evans and Moran’s report. “Unlike those age 65-plus whose daily TV allotment continues to rise, millennials are rapidly tuning out.”

People 65-and-older are averaging 450 minutes of TV viewing per day, according to tracking firm Nielsen. Viewership for 18-to-24-year-old people is down 4.7 percent year-over-year to less than 300 minutes. Among 25-to-34-year-olds, viewership is down 2.8 percent to an average of 250 minutes.

Young people are seemingly putting that extra time into smarphones and computers instead. Among millennial esports fans, 26 percent said they spent way more time viewing competitive gaming over the last 12 months. Another 26 percent of esports enthusiasts spent a little more time watching their favorite pro gaming events.

“Consequently, some 61 percent of esports followers spent less time in front of the tube over the past 12 months,” reads the report. “And 45 percent cut back on traditional sports viewing. And another 35 percent attended fewer sports events due to increased esports engagement.”

At a certain point, this comes down to a new form of media better serving an upcoming generation of consumers. Esports leagues are all online. Most matches stream for free on sites like Twitch. They are available on the web or through smartphone apps. Competitive gaming is easily accessible, and it lives where Millennials are already spending their time.

So if Goodell has a plan to counter that, it may have to rethink its content strategy that currently places a premium on exclusive television rights that make it difficult to watch games online or on a phone without paying a significant fee.

“Particularly as Millennials become increasingly dominant within the marketplace, sports industry leaders like leagues, broadcast partners, other stakeholders must sharpen their game,” Evans and Moran write. “[That includes] offering programming that caters to the needs of these highly mobile, less engaged viewers.”

The post Traditional sports have an esports problem appeared first on Android News.

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