Sponsorships and You!

There’s been a lot of talk on Twitter recently, especially in the Smash community, regarding the role of sponsors/organizations. I feel like there needs to be a bit of clarity in the language of the discussion, so I wanted to create a resource to do just that.

Why Should You Care?

Quick background–I have experience from multiple sides on this issue. I worked as a team manager for a group of players seeking sponsorship, and helped successfully negotiate a contract with an organization for that team. I then helped negotiate their release from contract when that became necessary I have also worked as an employee for an LCS team, Team 8 as a salaried employee. I was a part of the staff Skype groups that discussed how revenue came in, what the organization valued, and what they expected from players. Essentially, I know a little bit about what I’m saying here.

What is a Sponsor?

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This word gets thrown around alot by smashers on twitter. Ally was just sponsored by Cloud9, Mr. R is still looking for a sponsor–the list goes on. However, I think this is one of the fundamental problems with the misunderstanding at play. Ally was not sponsored, he signed with an esports organization. This is a key distinction.

Sponsors are companies that are essentially using a player or team as a marketing resource. The Pepsi logo on a NASCAR driver’s jersey, the All State logo on a field goal net–these are ways that sponsors interact with teams and players. They pay the team or player for the right to display their logo to capture a different demographic or expand their brain share in the population. Sponsors will have their athletes attend parties, utilize social media, and interact with fans at promotional events. The goal of all of this is to just get more eyeballs on their brand.

With this definition of “sponsor” we are no longer talking about Cloud9, TSM, or Team Liquid. In esports, we’re instead talking about Razr, Logitech, and Nvidia–companies who can use esports athletes to increase their brand share amongst their target demographic. If Mr. R was truly looking for a sponsor, he’d actually just be trying to get Red Bull to write him a check to wear a Red Bull hat to every event. They would sign a contract where Mr. R would have to tweet about Red Bull, go to a few Red Bull fan events, and have the Red Bull logo on his gear. That is the extent of a sponsor relationship.

So What’s an Organization?

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Basketball players, tennis pros, and NASCAR drivers have lots of sponsors. Because of the mass appeal of their sport and their personal brand, they can demand the attention of companies all by themselves. Esports has not reached that point yet. Nairo does not have enough mass-market appeal to appear in an ad for Oreos. You or I might go buy some Nairo Oreos, but the average kid on YouTube has no idea who this handsome dude in the glasses is, or why he’s so excited about these Oreos. Smash 4 as a game does not yet have enough eyeballs for even the top competitors to be worth investing marketing dollars in by themselves–no esport does.

This is where Organizations come in. An esports organization is pulling in revenue and eyeballs from multiple sources every day. On Friday, people are seeing TSM play League of Legends. On Sunday, TSM is in winners finals of a Smash Major. Some day of the week their Vainglory team is playing. All throughout the week people are watching, discussing, and tweeting about TSM as a brand. While Zero by himself may not have an overwhelming number of eyes on him at any given moment, combined with the LoL, CS:GO, and Vainglory teams there is a ton of brand equity in sponsoring TSM.

Logitech is willing to hand Reginald a big fat check because he has a large number of resources at his disposal that can promote Logitech. Bjergsen can stream while wearing Logitech headphones, Zero can be at the Logitech booth at PAX playing friendlies, the CS:GO team can do a video on Logitech’s YouTube. By being part of an organization, Zero’s value is multiplied because he is now a part of what attracts sponsors to a major esports brand. Esports orgs/teams are essentially the mechanism that connects players with sponsors that would otherwise ignore them.

And Your Point Is?

Partially my point is clarity. Let the teams go look for sponsors, and let esports athletes get signed by organizations. However, recognizing this distinction will be EXTREMELY useful to free agent players and teams.

Remember, esports orgs make very little money from your prize purses. The reason they want you to win is because of the brand equity that winning brings. More fans will follow a player on Twitter that recently won a major. Top players get more air time on stream because they play in more matches. Your attractiveness to an organization is directly proportional to the number of eyeballs that you bring to the table. No organization is going to pay you a lot of money just because you’re very good at smash. They actually make very little money because you’re very good at smash–it’s how they can use your skills at smash to get more twitter followers and sign bigger sponsors.

The good news here is for the players that don’t consistently win majors. If you can bring in eyeballs another way, you are still valuable to an organization. I would imagine Panda Global is pretty satisfied with their relationship with Esam despite his lack of major wins. He is very active on social media, has a strong Twitch following, and regularly produces YouTube content. Not only is he providing himself with additional income sources, but Panda Global can go to a sponsor and say “our Smash 4 players are high profile members of the community, just look at these Esam numbers!”. That is just as valuable to Nissan as if Esam won Evo.

Remember this point when you enter into negotiations with a team. Take a look at the other players on their roster across every game. How do your Twitter followers, Twitch subscribers, and tournament record compare? This will show you how valuable you’ll be to that organization, and just how much power you have in the negotiation.

Don’t Fight the Man

At the end of the day, sponsors and orgs are businesses. Their goal is to make money. This doesn’t make them evil, it just means they have responsibilities to their employees and shareholders to continue making profitable investments. They are not a charity–you do not deserve to be sponsored, you have to earn your place with an organization by making them money.

Ultimately, this setup is far better for the players for one simple reason–esports organizations actually want to win. Right now there is not enough money in esports for any of the major orgs to be in this solely for the money. Shaq and Rick Fox didn’t get into esports just to make a few more millions–they found another realm of competition that they wanted to dominate! Most organizations were founded either by former players, or fans of esports. They are willing to make some moves that sacrifice the biggest payout in order to support their players. I truly believe that NRG wants to help Nairo become the face of Smash 4. However, they wouldn’t have signed him if the move weren’t also going to be profitable.

So, if you’re looking to get signed by an organization, take action!  Create content, get active on social media, be visible on tournament streams. Be the player who can go to a team and say “look at all these eyeballs! If you want these eyeballs looking at you, Ima need a jersey and a check.”

 

 

 

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