Riot Games Oceania’s latest agency appointment suggests that the Oceanic Pro League is here for good.
Across the Pacific Ocean, the North American LCS enters its final playoff tournament before the league enters franchising.
The numbers are considerably bigger over in Santa Monica – Riot are asking teams for a $US10 million buy-in, and while revenue sharing will certainly help to offset that initial fee, it’s clear that the NA LCS is now at a point where Riot can choose to be much more judicious about who they choose to partner with.
What about in Australia? Well, we’re not quite there yet. Only this year did all eight OPL teams move into team houses, and the cost of relocation and housing was still absorbed in part by Riot Oceania as part of their move to a live studio broadcast.
Riot’s relationship with esports was born from a desire to meet player demand for high-level competition, and the mantra of ‘player value first’ guided the global establishment of League of Legends esports across the world in the face of financial loss.
And yes, regardless of whether you want to attach more self-seeking motives to Riot’s shameless declaration that esports is “a significant investment that [they’re] not making money from”, the fact stands that it isn’t a profitable venture for many developers – at least for now.
World of Tanks devs Wargaming are just one of many other companies willing to allow their esports departments to go into the red, either out of some altruistic love for their player base or, more realistically, the belief that esports will become a future cash cow.
Yet, the path to monetisation (and, ultimately, profitability) isn’t the same for every company. Valve have capitalised on the success of their tournaments by creating exclusive in-game content gated behind battle passes and compendiums, while stickers and themed skins anchor Counter-Strike: Global Offensive’s esports monetisation. Riot and Blizzard have struck sponsorship deals, but the financials around their esports ventures are anything but transparent.
So it might not come as a surprise that Riot Oceania have appointed TLA Worldwide as their exclusive sponsorship sales agency. Formerly Elite Sports Properties, TLA are a global sports marketing agency that have dipped their toes into just about every major sports league around the world, and they’ll be connecting sponsors with the OPL on Riot’s behalf.
Riot Oceania aren’t the first owners of a major esports league to employ a sponsorship agency to find them sources of revenue. Showdown (Twitch’s exclusive distributor of owned media in Australia and New Zealand) and Seven West Media (who recently launched screenPLAY, a new esports platform) have been connected to McDonald’s and St George Bank thanks to the efforts of sports marketing agency The Gemba Group.
The OPL has danced with big league sponsors before – apart from the very esportsy Logitech and Red Bull, Domino’s and Uber have entered partnerships with Riot in the past. And unless Riot find a way to move cash from their viewers’ pockets into their coffers a la Valve, sponsors will likely be their major source of esports revenue moving forward.
Endemic sponsors will always be there. You don’t need to do a lot of work to sell a core gamer a Logitech mouse or a four-pack of Red Bull. The challenge lies in the non-endemic sponsors – brands that sit on the fringe, like PwC and Streets. Esports fans are fickle. There are only so many brand activations they can tolerate before a clever partnership becomes annoying marketing. It is this question that Riot will have to navigate if the OPL is to see long-term success.
Riot see the OPL as a competitor to the AFL or any other major sports league in the Oceanic region. If the sleek analyst desks, sideline interviews and prized tipping contests didn’t tip you off, the aggressive sponsorship deals should. They’ve convinced us that League of Legends and the OPL are here to stay. For their sake, let’s hope they’re right.