Why brands like Spotify & Louis Vuitton advertise through League of Legends

This year’s League of Legends World Championship is almost at a close, and it’s been the most sponsored edition of the legendary event to date.

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The popular MOBA title seems to be going from strength to strength each year, with rising viewership, ever-growing commercial success, outside recognition from traditional sports, and a more robust competitive ecosystem.

With brands such as Bose, Spotify, Mercedes-Benz, and Cisco getting involved in 2020, as well as a landmark broadcast deal for Chinese viewers, it’s fair to say that Riot Games’ flagship title is leading the pack when it comes to commercial partnerships.

Dexerto spoke with Naz Aletaha, head of global esports partnerships and business development for Riot Games, to find out exactly why major brands are dying to get involved with League of Legends esports.

“It’s definitely evolved over the years,” Aletaha said of how such deals begin. “In the last two or three years is where we’ve really seen an inpouring of inquiries, attention, and understanding. Understanding is the most important piece. Esports has been pretty big for quite some time, we started in 2011 and each year the sport, fandom, and viewership has continued to grow.

“In the early years, there wasn’t a solid understanding in the marketplace on what esports was and really what the value proposition was for brands to get involved. There were probably some questions brands had around the longevity of esports, whether it was a sport or not.”

• Read More: Day 1 of LoL Worlds 2020 smashes viewership record for Play-in stage

Broadening the pool

What are the factors behind such a change in heart for prominent, household companies? We still see some sports fans ridiculing the concept of competitive video games when they get their time to shine on networks such as ESPN, so it’s clear that the industry has a way to go before the general population is acclimatized. That’s changing rapidly on the business front, however.

“The market has a pretty good baseline understanding of what esports is now, the viewership and engagement that we see are really starting to rival what’s seen in traditional sports, and the audience is incredibly engaged,” she explained. “This demographic is getting harder and harder to reach through traditional forms of marketing.”

On the surface, it may seem fair to attribute the rise in viewership — which likely is in part down to the global health situation, with sports being sidelined for much of the year — to the mainstream acceptance, but Aletaha thinks there’s more to it.

“The fact that we’re so global and we’ve set up an ecosystem where partners and brands can get involved at various levels opens up so much opportunity,” she said. “We have 12 regional leagues across the world and then we have these massive global events that bring attention from every corner of the world, that’s very attractive to brands.”

League of Legends has an official competitive structure that sees major leagues taking place in major countries and regions; Brazil, China, Europe, Korea, Latin America, North America, and plenty more are all involved. This translates well when they’re all brought together in what’s deemed a “global” event, and Riot Games ensure that these fan bases are served properly.

“For our global events, because we are catering to a global audience, we broadcast Worlds in over 15 languages,” said Aletaha. “That level of customization and localization allows us to accommodate brands that are interested in certain markets through specific language feeds. China is a very good example of this. You see our global partners in the Mandarin feed but you also see specific Chinese partners that are very relevant for that local market.”

The legitimacy of the All-Star Event and MSI

In League of Legends’ suite of global competitions are three annual events. There’s the Mid-Season Invitational, an All-Star Event, and, of course, the World Championship. The latter is, as you’d expect, the crown jewel of the game’s esports calendar — but does it prop up the other tournaments?

“Worlds, if you plotted our events on a pyramid, is the pinnacle,” she explained. “That’s what every team in our ecosystem is working towards throughout the entire season. You could liken it to our Super Bowl or our World Cup.”

Despite Worlds undoubtedly being the summit of competition, Aletaha thinks each of the three global initiatives has their own merits and each contributes towards the commercial interest in League of Legends esports.

“All three of our global events have their own unique value and themes,” she told Dexerto. “Each event has its own identity. All-Star is a fun celebration of the season, it’s meant to celebrate the pros and their performance, and be something that fans can engage with. MSI is meant to be a midpoint check-in on who is the best. You’ve watched a split in each of the regional leagues so now let’s have those winners face-off to determine who’s the best at the halfway point.

“If you’re a partner of the three global events, it gives you the opportunity to always be on. Through the first split you’re working up to MSI, then there’s Worlds, then we finish the year with All-Stars.”

• Read More: Are LCS teams failing? LoL Worlds 2020 review ft. Amazing & Munchables

This year’s World Championship has a nice mix of gaming brands and companies that operate outside of League of Legends’ expected periphery. That’s not by design, as Aletaha explains, but instead is a testament to the variety of partners that they’ve managed to secure. There’s not a quota to meet in terms of diversity of companies, instead, it’s about who can help them to improve the experience for fans.

“Our goal with any partnership, whether it’s with an endemic or non-endemic brand, is that that brand wants to come in and do right by our audience,” she said. “That’s the most important box that we look to check. You can see endemics like Alienware and Secretlab have such a deep understanding of the audience and the community, that makes them incredibly able and willing to do things for and with our fans that we really like to see.

“The same thing can go with Mastercard and what they do for their community, and Mercedes-Benz and Spotify too. We don’t look to achieve a certain mix [of endemic and non-endemic brands], we try to look through the same lens across any partner that we bring into the fold.”

It’s more about the value proposition of a prospective partner. How do they add to the experience, whether that be the broadcast, shoulder content, social media, or in a venue? Riot Games always keep the product in mind, and how it will be received by their spectators.

“Any partnership has to be a win-win-win,” said Aletaha. “It’s not just a two-way win for Riot Games and our partner, it has to be a win for our whole ecosystem. That’s the goal. I don’t think you achieve that goal if it’s a pure transaction where a sponsor pays you dollars and you display their logo. It has to be more than that.

“We really look to create a robust campaign with each of our partners that, of course, includes advertising elements, but that advertising should reinforce what they’re doing for the community. That’s what’s going to make the brand successful and continue to drive [partnership] renewals. All of this needs to accrue to our fans and their experience with League of Legends esports.”

Content is (still) king

This year’s World Championship has been supplemented with content from almost all of their partners. From Spotify producing and housing podcasts, to Cisco writing blogs about their involvement, to Mastercard enabling Riot Games to produce video series, it’s clear that there’s a focus on content — now more than ever.

Aletaha insists that this isn’t just a sign of the limitations brought about this year, but it definitely helps to be able to work with partners in such a way considering the difficulties.

“The fact we’re a digital sport and our audience is digitally-savvy absolutely helps given the constraints that has been presented,” she explained. “The live event experience is really important and compelling for brands, but when you also focus on the digital side you’re going to be able to engage with exponentially more fans. The content play is what we’d do regardless.”

Perhaps the most groundbreaking advancement made in terms of advertisement capabilities for League of Legends was the integration of in-game banners. Announced in May 2020 with Mastercard and Alienware up to bat first, partners were now able to have their brands shown right next to the action during live matches.

This innovation is just the tip of the iceberg when considering the potential scale of such technology, but it’s already a success for Riot Games.

“It really adds to a well-rounded package,” she told Dexerto. “It’s important for partners to really be woven through the various touchpoints that we can offer. Any single asset or placement is valuable on its own, but it’s the sum of the parts that creates a cohesive, holistic connection to the sport and reinforce their activation and engagement.

“Sponsors are absolutely loving it and it starts to bring us to parity what traditional sports offer. You’re used to seeing brands next to a pitch or a court, we’re now able to do that in our physical arenas and also leverage our virtual real estate as well.”

One pertinent question that arises when you consider the potential impact of in-game ads is surrounding their value. Just how much dollar value do they provide to partners, and how is value even measured? An approximation of watch time multiplied by a set figure is likely the formula, and Riot Games enlisted some help to nail down a price tag.

“We worked with Nielsen, who use a quality index score to evaluate banners,” said Aletaha. “They use a methodology to evaluate the rest of our inventory, and inventory for sports in general. We worked really closely with them on this, including when we developed the product itself because we needed to make sure we were optimizing for viewability, clarity, placements, and angles to make sure they’re effective for our partners.”

We’d be remiss to ignore the landmark deal closed by Riot Games and Bilibili. In December 2019, it was reported that the Chinese video platform had purchased the rights to broadcast Worlds in Chinese for 800 million yuan (roughly £90 million) over three years. Confirmed in August this year, though the monetary value was never officially disclosed, this transaction is the largest media rights deal to date.

• Read More: How much are CDL broadcast rights worth compared to OWL & LCS?

In many traditional sports, media rights deals are the largest piece of the pie but that hasn’t translated into esports yet, somewhat down to the prominence of streaming platforms such as Twitch and YouTube, but this purchase, in particular, demonstrates that the tides may well be changing.

“There absolutely will be growth in media rights revenues going forward,” she said. “The Bilibili deal is a landmark deal and a testament to the demand for the content with our fans. I think that demand is going to continue to go up.

“You see the viewership numbers year-over-year — the play-ins at Worlds this year broke all of our records — and we’re seeing a massive demand for content. We hope to service that viewership by putting on an incredible production.”