Mentioned in this article Games: Overwatch

A longer version of this article can be found in The Esports Observer’s Esports Marketing Management 2019 report. Get your copy here.

The success of any live broadcast property, regardless of industry, depends on the ability to measure and understand your audience. Despite the much-publicized investment and growth of esports, the industry still remains highly fractured when it comes to competition regulation, regional market share, and most importantly, verifying viewership and engagement. The latter is due to the difficulty of measuring the livestreaming market which, regardless of platform, results in most game publishers and tournament organizers self-reporting their audience numbers.

Nielsen dove into esports in 2017 with a dedicated division, and is now delivering comprehensive sponsorship valuation measurement for multiple top-tier esports competitions. Each of these partnerships is designed to help game-publishers deliver audience metrics more in line with what mainstream brands are used to seeing in traditional sports, and which can be standardized across the esports industry.

“From our standpoint, thinking about traditional television viewership, average audience is really the key metric that we look at [from] a TV ratings standpoint, as well as using [it] to incorporate into valuations in that space,” said Nicole Pike, head of esports at Nielsen. “We were looking at how we can get to the equivalent, or as close as possible to the equivalent, without Nielsen actively measuring esports content in the same way we do television, as of right now at least.”

Nielsen defines “average minute audience” (AMA) as “the average number of individuals or (homes or target group) viewing a TV channel, which is calculated per minute during a specified period of time over the program duration.”

Esports has traditionally relied on a completely separate set of statistics than TV, including unique viewers, peak concurrent viewers, or total hours watched. While the latter holds some value for rights holders, each of these raises their own problems in terms of reliability and verification.

A number of independent esports tournament organizers, such as ESL and FACEIT, have begun releasing metrics similar to AMA. However, since these numbers are self-reported and not used routinely, there is a risk of selective publication or differences in methodology. For Nielsen, this creates a business case to align esports stakeholders (including competing companies) to foster consistency in audience metrics.

Why AMA is Crucial to the Overwatch League’s Success

Activision Blizzard’s flagship esports property, the Overwatch League (OWL), is an attempt to introduce the standard structure of professional North American sports into competitive gaming, and all of the marketing real estate and brand support that comes with that. Some of these concepts, which at this point are largely exclusive to the OWL, include territorial (or “franchise”) rights for teams, a planned home and away game schedule, and exclusive control over the Overwatch IP at all esports events.

In its first two years of play, the OWL has signed fortune 500 company-owned brands including Coca-Cola, Intel, and State Farm, signed broadcast deals with Disney family broadcasters (including ESPN and ABC), and introduced 20 unique franchise teams—each of which paid at least $20M USD in reported buy-in fees. Considering the total investment from all league partners, as well as Activision Blizzard itself, the success or failure of the OWL will have a lasting effect on the esports industry as a whole.

“At the end of the day, sponsors are investing in esports to have exposure to an audience. In that case, viewership is very important because that’s the exposure they’re getting,” said Kasra Jafroodi, esports strategy and analytics lead at Blizzard Entertainment. “The two main questions we want to answer at all times: how many people are watching on average, and how many people are watching in total?”

Jafroodi explained that, for both questions, Blizzard is relying heavily on the platforms the league is showing on, which includes multiple broadcast partners across North America, Europe, and China. “Blizzard doesn’t have a way to measure how many people are watching us on Twitch, or on the Chinese platforms,” he said. “Everywhere we air, we have a direct partnership with that platform to receive numbers that are not necessarily the public-facing numbers, but numbers that we know are true and real.”

Overwatch League 2019 Regular Season Numbers:

OWL’s 2019 regular season ended with a global AMA of 313k, up 18% YoY.

The USA AMA for the season was 95k AMA, up 34% YoY.

The 18-34 US AMA for the season was 55k AMA, up 11% YoY.

“We work with companies like Nielsen to ensure that, when we equate our overall viewership numbers, we’re following the same standards as anyone else in the traditional sports space.”

Although Activision Blizzard’s esports partnership with Nielsen was only announced in April of 2018, the companies had been in active collaboration since late 2017. “Activision Blizzard was really the first company that came to us proactively and said that they were looking to [..] compare viewership of their events to traditional sports events, as they were talking to advertisers, sponsors, and brand marketers,” said Pike.

Jafroodi noted that there was an education required for both companies. Although Activision Blizzard had been running esports tournament properties for years, its established tournament IPs, including the Heroes of the Storm Global Series, StarCraft II World Championship Series, and Hearthstone tournament circuit had not accrued close to the amount of sponsorship revenue that OWL had promised. The publisher had to understand how traditional properties are measured, and how brands measure ROI on their other investments that aren’t gaming or digital-focused.

“At the same time, Nielsen had to understand how to measure value in something that didn’t come from linear broadcast, and how to measure an audience that was much younger, much more valuable,” he said.

One of the key services that Nielsen provides for the OWL is the brand impact, where it essentially runs research to understand how fans of the league are reacting to brand partners. As detailed in Nielsen’s Esports Playbook for 2019, the first season of the league positively impacted fans’ awareness of OWL sponsors, and how strongly fans prefer these brands to their competitors.

Examples of OWL brand logo placement. Top left: Caster Desk Signage. Top right: Video Boards & LED Screen. Lower left: Full-Screen Graphics/Digital Billboards. Lower right: Video Vignettes/Stitched Commercials. Credit: Blizzard Entertainment.

“We saw in the first year of OWL that the favorability for their brand partners, on average, was consistent with what we see for traditional sports – naming rights, tier-one sponsorships, where the name of the brand is integrated directly into the league name, or the official beer of, car of, those sorts of sponsorships,” said Pike.

“You can do logo slaps and just put a brand’s images up there, but truly treating it as a partnership and making sure fans understand how the brand is adding to their experience and to the property is really important.”

While the OWL is run in a similar way to traditional sports leagues, it is still encumbered by a lot of the same issues when it comes to producing meaningful audience metrics. For starters, this is a digital-first sports property, where the linear TV is secondary. According to Pike, there’s a lot more granularity when Nielsen can look at the OWL audience on TV, on a particular channel.

“We can see demographics, we can see what they were watching before and after,” she said. “There’s just a lot more deep analytics that can be done through what Nielsen captures with our TV rating product. Of course, when you have the same content aired on multiple channels it becomes complicated.”

These complications chiefly surround the long programming time of esports events, which for a regular-season day of the OWL equates to a 20+ hour broadcast. In theory, matches are supposed to begin at specific times, but in practice, that’s not always the case, which creates a challenge in aligning online viewership data with TV footage that jumps in mid-stream or mid-matchday.

“The math for AMA is minutes watched divided by minutes broadcast, and the good thing is no matter what platform content is shown on, whether it’s linear, Twitch, or Chinese platform, that minutes watched number is something everyone has and everyone provides,” said Jafroodi.

To read the full version of this article, download The Esports Observer’s Esports Marketing Management 2019 report. Find out who is in the market, which data sets they own, and how they use it. Several case studies teach you how to measure your marketing campaign and the effective use of data.