Riot Games wants to really grow the competitive eSports market of League of Legends. They're attempting to leverage several important facets to make the electronic sport more profitable for the teams and organizations involved and they've already secured one method in nearly doubling the prize pools.
Over on the League of Legends eSports website there's a lengthy article explaining where the competitive market for League of Legends started and where it's headed. They explain that there are three key things that they are looking to grow in order to make the future of eSports profitable for League of Legends. This includes growing the fandom, securing the economics and increasing the financial stability of the market.
The stability and economics kind of tie-in together.. While advertising and sponsorship deals are still a rarity, and something that Riot Games is still working towards, a more immediate solution comes in the form of in-game microtransaction and DLC sales.
Some eSports management organizations had mentioned previously that profits and revenue aren't quite sustainable in the market yet when it comes to marketing deals, sponsorships, and advertising. To compensate for this, Riot is introducing a 25% revenue share from Championship skins and ward for tournaments. This way, no matter what the sponsorship pool looks like, top teams will earn based on a cut of the revenue generated from League of Legends' in-game sales, similar to the method Valve uses for eSports prize pools for Dota 2 tournaments.
Championship skin revenue isn't the only revenue being used toward tournament play. Riot will also utilize Challenger Skins, Team Championship Skins and new cash-shop items to help proliferate and grow the earnings share for eSports.
Riot mentions in the post that they're still trying to work out inking deals with major sponsors and advertisers, but in the meantime they can greatly increase championship earnings with the in-game revenue share model. According to the post, had they applied this method to last year's prize pools, it would have doubled the amount of pool earnings for League of Legends teams.
The company plans on rolling out team-oriented merchandise so fans of their favorite teams can purchase shirts and other goods to help bolster the market value of the eSports division. Riot is currently working at establishing merchandising for the teams, and it's something they want to get up and out as soon as possible.
Riot is also working with other regions and leagues that are struggling to get established. The more established each league is the bigger League of Legends will become as a competitive eSports venture. There are 13 leagues from around the world, but only a select few are well established. Riot is looking into helping these other regions out in order to make it a viable career choice for gamers, managers, and team organizers.
It sounds like Riot is being very proactive in helping the eSports market grow. One thing they need to be careful of is not to turn off the fans who helped make the game what it is. Some eSports organizations have been trying to tap into the casual audience by moving away from the more hardcore gamers, and that's the best way to kill off a brand before it even gets established. Riot appears to be going about League of Legends' eSports growth in a slow and steady manner. Nevertheless, adding the DLC revenue share to the pot is definitely going to make a lot of teams a lot more profitable over the competitive season.
