Essay Example on E-Sports: Capitalizing on Global Opportunities for Smart Phones

Introduction

In the wake of increased global dynamism and trends in technological development, most corporates and start-ups are capitalizing on electronic sports. With over 45% of the World population having smart phones (Statista, 2019), and over 58% having access to the internet, it opens a wide range of opportunities in e-sport. Companies across the globe are coming up with a variety of e-sports, with the main focus being ones that can be accessed via smart phones. Many start-ups have developed video game applications that can be accessed through operating systems such as Windows, Android and Linux, macOS, and iOS, among others.

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The available evidence shows that the main investors in the e-sports are start-ups, an indication that this is an opportunity that is highly gaining momentum with corporates not taking high risk in it. In the year 2018, for instance, out of the over $4.57 US Dollars invested in e-sports, over 56% of the investment came from start-ups. The industry has grown by more than 103% from 2014 to 2018 an indication of a high area of interest in the modern World. While the investment in the e-sports has been steadily increasing, the number of fans has been as well on the high rise. As pointed out in the opportunity-based theory of entrepreneurship by Drucker (1985, P. 93), modern entrepreneurs will be keen to identify increase in opportunities such as the spread of technology advancements, increase in internet penetration and increase in the number of smartphone users as well as other demographic trends and take advantage of these trends.

The new entrants in the e-sport industry are mainly focusing on the expected growth in demand and changes in the global market of techno-based interactions and entertainment (Shirobakina, 2016). This is exactly what Drucker (1985, P. 107) perceives entrepreneurship where opportunities are based on past changes, emerging trends and forecasts of future trends. Some companies such as The Wavedash in California are highly focused on investing e-sports while improving on their platforms based on emerging opportunities. The company has recently improved on spectator participation and multiplayer games as a way of changing from the normal e-sport interactions.

Activision Blizzard, a leading e-sport company has extensively focused on new market trends in coming up with gaming platforms and how to maximize their penetration into the market. The company started with the console-focused gaming platform, and after the computer network expanded, they started a PC-focused segment. Recently, the company launched a mobile-focused segment, and the investors cited the continued growth of mobile technology as their main driver towards the mobile-based platform. The company has a market capitalization of over $45 billion and continues to take advantage of new opportunities in the industry, including the recent adoption of the city-based franchise model that integrates e-sport with the traditional sport.

Electronic Arts (EA) that runs popular e-sport games such as Madden and FIFA continues to extensively capitalize on the growing e-sport market. The company has diversified to other e-sport related ventures such as advertising and sponsorship rights, which has seen the company increase its profit margins by far. According to Hamari and Sjoblom (2017), while some of the corporates and start-ups in the e-sport industry may seem to have dominated the market, the growth in demand surpasses the currently available platforms in that people's interests and preferences keep on changing. So they would require different platforms, and varieties.

Strategies used to Overcome Weaknesses and Utilize Strengths

The e-sport market, however, has its unique weaknesses and strengths which every investor interested in the field would wish to critically analyze and put into consideration. There are numerous strengths in e-sports, such as the growing market and viewership of e-sports and the increase in sponsors. These strengths are mainly tied to the increased internet penetration across the globe, technological advancements and growth in global access to smartphones, computers and other technological devices.

To utilize these strengths, there are several strategies that ought to be taken into consideration. One is extensive market research. One has to highly carry out market research on the quality of products offered by other players and how well the customer needs are met in the e-sport avenue (Pawlowski, Nalbantis & Coates, 2018). Through research and a proper market survey, investors will understand the key areas of focus and how to obtain the best out of e-sport.

Innovation is another strategy that entrepreneurs in e-sport should focus on. By being innovative, it means that one has to bring in new ways of doing things in the field to capture the growing market. According to Denegri-Knott and Molesworth (2010), digital consumer products and services such as e-sport require extensive product innovation and adoption of new changes since most of the consumers are aware of the emerging trends which shape their expectations.

Other strategies that are cited to highly influence the utilization strengths in e-sports include a target of the right audience, extensive promotion and marketing, use of a consumer-centred design framework as well as choice of the right streaming platforms. Diversifying also can enable an e-sport entrepreneur to utilize the strengths in this opportunity. The entrepreneurs ought to find out other avenues that can be integrated with e-sport to capture more market. These avenues include video ads, sponsorships and other forms of advertisements.

Venturing into e-sports market also has its weaknesses which any entrepreneur considering the opportunity should keenly interrogate and come up with strategies to contain them. One of the weaknesses is the lack of specified audience and mainstreams to singularly assess the fans. This means that the content is likely to fall into the hands of the untargeted audience, and this would affect the effectiveness of the e-sport. New entrants, as well as the existing corporates in the sector, ought to explore measures through which they can gain control of the audience. This would require extensive investment in technology as well as the partnership with other sectors such as social media platforms.

Lack of appropriate and adequate infrastructure is another weakness in the e-sport sector. While the market has been extensively growing, there is inadequate infrastructure to cater to other prospects of the industry, such as training and promoting professionalism. Partnership with other players in the market is a major strategy that can enable the entrepreneurs in this sector to overcome this weakness. Through partnerships, the entrepreneur will find better ways to identify the ways to promote their services with the available limited infrastructure.

Conclusion

E-sport is a young industry that is yet to be regulated according to the emerging issues in the modern World, such as cheating, impersonation, and data security. This has led to many fans fearing for misuse of their data by e-sport companies while players fear to lose their remunerations due to poor regulation of the industry. To overcome such weaknesses, one will require convincing the audience of privacy of their data. This should be a market strategy for a new entrant in the sector by indicating how the data from the audience is treated with the utmost privacy.

References

Denegri-Knott, J., & Molesworth, M. (2010). Concepts and practices of digital virtual consumption. Consumption, Markets and Culture, 13(2), 109-132. DOI: 10.1080/10253860903562130

Drucker, P.F. (1985).Innovation and Entrepreneurship. New York: Harper & Row Publishers

Hamari, J., & Sjoblom, M. (2017). What is esports and why do people watch it? Internet research, 27(2).Macey, J., & Hamari, J. (2018). Investigating relationships between video gaming, spectating esports, and gambling. Computers in Human Behavior, 80, 344-353.

Newzoo. (2019) Global esports market report. https://newzoo.com/solutions/standard/market-forecasts/global-esports-marketreport/.

Pawlowski, T., Nalbantis, G., & Coates, D. (2018). Perceived game uncertainty, suspense and the demand for sport. Economic Inquiry, 56(1), 173-192.

Shirobakina, E. A. (2016). Cyber sport: from just a hobby to a professional sport. Fizicheskoye vospitaniye i sportivnaya trenirovka, 3(17), 60-63.

Statista. (2016). Revenue of the largest computer and video game publishers worldwide in 2015 (in billion euros) Retrieved from http://www.statista.com/statistics/273838/revenue-ofthe-largest-video-game-publishers-worldwide/

Statista. (2019). Value of the global video games market 2012-2021. https://www.statista.com/statistics/246888/value-of-the-globalvideo-game-market/