eSports has been a touchy subject over the past two years. What looked like a bright future post the 2020 era is now a cash-burning sector as per many orgs. Though video games have been selling more titles year on year, not every one of them is active in the esports scene. Veteran Titles like Counter-Strike have seen a rapid decrease in the number of tournaments being held yearly. Overwatch even closed its official franchise league recently despite releasing Overwatch 2 just a few years back. Once upon a time, being called a franchise team attracted big-name sponsors. But now, these sponsors don’t even make up for 30% of team costs. Let’s break down and analyze how teams can make money off of esports.
Prize money = Basic Money For Any eSports Org
The biggest attraction to any org that’s aiming to make a profit is obviously raking in prize money on a regular basis. Winning just a single trophy in a season accounts for nothing these days. Instead, being consistently in the prize position throughout the year is what any esports team dreams of. In most top-tier orgs, prize money isn’t as important as they rely on other sources of revenue to keep funding their roster. The same cannot be said for tier 2 and tier 3 teams. For them, every cash prize allows them to push for more tournaments and consistently make money by winning. This isn’t as easy as it sounds, but without winning, the basic source of revenue will always come into question.
Jersey Sponsors Can Make Org Owners Millionaires.
Featuring a company ad on any elite esports jersey is one of the most consistent ways of making money. Companies like AMD and Intel are some of the biggest names to drop above $100 million a year in just esports ads. Apart from that, other brands like Logitech, Sony, Razer, etc., are regular sponsors in many major tournaments. Teams get a fixed amount of money every month from their sponsor depending on the org’s value. Some orgs hire top streamers and content creators just to attract more sponsors and big names on their jerseys. Valorant orgs actively hire content creators to increase their overall reach. This attracts more sponsors to feature their products through these big-name streamers. Tarik and Curry are content creators and are the perfect examples of streamers signed by orgs to attract better sponsors.
Merchandise Sales
Just like in any major real-life sports, teams make huge money by selling their team jerseys. The same applies to eSports. Teams invest heavily in exclusive hoodies, jerseys, bags, keychains, etc., to keep their business alive. Often, orgs drop “exclusive” merch that is limited in number and leads to massive hype. Merch stock for big teams often clears out within minutes of launch. Winning any major tournament in an esports event leads to a drastic increase in merch sales. Again, signing big-name content creators like Shroud, Ninja, Tarik, and so on allows orgs to collaborate with these big names and make more money selling their exclusive “collab” merch.
