Trends and Threats in the Esports Betting Industry

Trends and Threats in the Esports Betting Industry

The events of 2020 sent the world into a frenzy affecting all types of industries. The past year has been especially weird for the gambling industry, with the impact COVID-19 had on sports betting.

Let’s dive into the trends and threats that emerged in relation to the way esports unfolded in 2020.

With sports events being cancelled across the globe, and in order to dampen the effects, the betting industry turned to esports as a savior. The unusual circumstances created an opportunity for esports to reach a new audience that it might not otherwise reach. Ultimately, it turned out esports might be more than an emergency solution, and the numbers started backing it up. A recent survey reported that more than 22% of the gamblers that never bet on esports are willing to do so in the next three months, and 30% of the esports bettors only started within one month. It’s no wonder that the esports betting turnover is projected to surge past 14$ billion, showing impressive growth – values are doubled from 7$ billion in 2019. The recent growth will also help propel the global esports market to reach more than $3 billion by 2025.

Putting esports in the spotlight during the pandemic accelerated the development of the esports product. For betting companies, the long-standing question of “should we get involved in esports” was quickly replaced with how to do it best, because everybody is already doing it.  B2B co-operations around esports boomed. To replace traditional sports and increase the betting volume, sportsbooks needed more competitive gaming events in their portfolio, and data providers focused on ensuring wider coverage. As a reference, the esports betting program had over 50 000 events in July 2020, a multiple times increase from the 3000 events available a year earlier in July 2019. Exposure and cross-selling traditional sports bettors led to video game titles representing physical sports experiencing record growths and betting activity.

Bearing the slogan “It’s all about sports”, the team shared some more insights.“The interest in FIFA and NBA 2K events exploded back in April. As search traffic is our main traffic channel, we emphasize on SEO. What we saw was esports related keywords’ volume raising early in the pandemic. From obscure and niche games, FIFA and NBA 2K  started to attract as many visitors as the ones like Counter-Strike Global Offensive, Dota 2 and League of Legends. There was even a time where FIFA 20 Champions League events were one of the most visited pages on the site.” said Yordan Spasov, project manager at Oddspedia.  Asked about which Oddspedia esports features have become user favorites,  Yordan replied:  “Our users are enjoying the extensive esports odds comparison that Oddspedia offers. They are able to get a lot of value by taking the best lines since there are some serious discrepancies in the odds offered on esports events. The geolocation feature delivers personalized content and helps them find only relevant betting sites based on their location. We saw Oddspedia’s Widgets being in high demand for esports, as publishers enhanced their digital content with esports real-time data via our ready-to-use solution.“

Even with major sports back on the schedule, and bounce to traditional betting, the boom of esports betting is expected to continue as projections account for a 10% increase for 2021.  Some trends to eSports betting will carry on in the future. Popularity can only go up due to many factors such as: Social distancing is a driving factor contributing to higher engagement.; viewership numbers from streaming platforms pile up; content creators are producing at a higher rate; sponsorships and investments are coming in hot. Betting operators are constantly improving their products to cater to their audience and build brand loyalty – more betting markets are being offered, the limits are higher, inplay solution itself went from 50% uptime to 90%, esports coverage now includes some of the lower tier competitions and less popular esports titles as well.

And although the tremendous effect the pandemic had on esports betting-wise, it exposed some critical threats as well. The biggest threat by far is integrity.  Esports always had issues with integrity, but nowadays it’s more serious than ever. Match-fixing is rampant, even more than most people expect. The lack of proper anti-fraud and cheating mechanisms can also seriously hinder the growth of the esports betting market. Unless action is taken, and there are overseeing committees, regulations, and consequences in place, this will not stop.

But how to ensure the integrity of esports? It may take some effort and collaboration from all kinds of stakeholders to research issues and different cases – from betting companies, data providers, esports organizations, integrity commissions, event organizers to the game publishers. A recent deal between Activision Blizzard and Sportradar is a good example as it instituted a comprehensive integrity program for their Overwatch and Call of Duty leagues, similar to deals in recent years by major traditional sports leagues.

Another concern regarding esports betting growth includes the general public’s lack of esports knowledge when betting. Most esports titles like Dota 2, League of Legends are very complex, hard to comprehend for people on the outside. Betting markets, besides match outcome, are not easy to understand if one does not have a deeper knowledge of the game.  While almost anyone can understand props like Messi to score in the first half or Lebron to have over 30 points for the game, the number of people that can make sense of Team’s Carry to have more than 100 creeps by minute 10 is limited. Hence why traditional bettors went to fill in their needs on the closest thing they know (FIFA & NBA 2K) during the lockdown.

But let’s not forget that eSports is a generational thing, being born in the digital era, which means that the generation of gamers is now kicking in. Of course, the majority of people aged over 35 are into traditional sports. This changes with Millenials (25-35) who are equally interested in both. Generation Z (18-25) however are growing up exposed to competitive gaming and Twitch streaming. They watch frequently and are more engaged in esports than traditional sports, and may recite the results of Dota2 “The International” over the past few years instead of football’s England Premier League. Not to mention you don’t need stats to see that teenagers nowadays are all about esports. Moreover, esports viewers (specifically, enthusiasts) have increased value due to the fact they are more likely to maintain full-time employment than the overall online population (67% vs 53%) and have high household incomes (43% vs. 30%). Those demographics, consisting of a younger generation of consumers, are swinging the trend heavily into a positive outcome for the betting industry. 

Esports is one of the hottest betting verticals and the massive figures they’ve started to generate, including $15 billion in betting turnover this year alone, is a testament to that. Further developing the esports betting product, working within a regulated framework and preserving the integrity may see eSports become one of the most popular sports globally in just a few years time.