The Madison Square Garden Company (MSG), owners of the world famous sporting venue as well as the New York Knicks and Rangers, is the latest traditional sports and entertainment company to invest big in esports. MSG has acquired a controlling stake in North American esports team Counter Logic Gaming (CLG), which fields professional teams across League of Legends, Counter Strike: Global Offensive, Overwatch, Super Smash Bros. and H1Z1.
With this partnership, MSG significantly expands its presence into the fast-growing world of competitive gaming, offering the esports brand full access to its sports business, including marketing partnerships, media rights, event operations, ticketing, merchandise and fan engagement. MSG has already hosted two sell-out esports events in August 2015 and October 2016.
Jordan Solomon, executive vice president of MSG Sports, told AListDaily that witnessing the October 2016 LCS World Semifinals at Madison Square Garden first-hand played a major factor in the company’s commitment to esports.
“The fans are rabid and enthusiastic, and these are incredible events,” Solomon said. “As an organization, we’re always looking to put on and host iconic events at our venues and the esports tournaments and competitions are some of the more compelling up-and-coming events.”
MSG also owns the New York-based venues Radio City Music Hall and the Beacon Theatre, The Forum in Inglewood, California, The Chicago Theatre and the Wang Theatre in Boston. “We have looked for the last couple of years for how to get involved in this growing industry and saw esports events as a natural entry point into the industry,” Solomon said.
ESL and Riot Games have both used The Theater at Madison Square Garden for events, while Activision Blizzard used The Forum for last year’s Call of Duty XP. “With CLG, we saw team ownership as an attractive opportunity in a world where more esports leagues are going towards a franchise model,” Solomon added. “We see this franchise model as an opportunity where we can build off of our expertise,” Solomon explained. “But we don’t have expertise in selecting players and coaches and building out the infrastructure of a successful esports team. Partnering with CLG is perfect because that’s where they’ve been extremely successful.”
In addition to the Knicks and Rangers, MSG owns the New York Liberty (WNBA), along with two development league teams—the Westchester Knicks (NBAGL) and the Hartford Wolf Pack (AHL). Esports opens up a brand new and younger audience to MSG. According to research firm Newzoo, 285 million people worldwide watched esports events last year, and the majority of this audience are the millennial and Gen Z viewers sponsors are clamoring for.
“We don’t see a ton of overlap between traditional sports fans and esports fans,” Solomon said. “A lot of the folks coming to esports are people we have never interacted with in the past. It’s a different demographic, and that’s exciting because it’s a new way to introduce our venues, customer experience and brands to them. That’s why we’re always looking for the next set of live experiences.”
— Counter Logic Gaming (@clgaming) July 31, 2017
When it comes to brands and sponsors, Solomon sees esports as an unbounded opportunity. “We want to help connect both endemic and non-endemic—including our more traditional marketing partners—to the esports space,” Solomon said. “We have numerous partners across all of the traditional industries we’ve worked with for decades. They’ve come to us asking how they can get into the esports space.”
In addition to the CLG teams, MSG will also be involved in the debut of the NBA 2K ELeague next year through the Knicks. “We see all of these video games as entry points for our traditional marketing partners,” Solomon said.
He added that one of the current issues that still surrounds esports is that many traditional brands aren’t sure what they’re going to get when partnering with a young and inexperienced esports organization. That has lead to trepidation on esports teams being able to deliver on a brand’s marketing goals.
“We’ll help bring these deals to life,” Solomon said. “We have plenty of experience partnering with brands and connection with millennials across our events and teams. We’ve seen a lot of inbound interest around that notion since the CLG announcement.”
While games like Super Smash Bros. and Overwatch have attracted a more mainstream audience, NBA 2K has the potential to connect with an even broader audience.
“The 2K esports endeavor is really compelling for both existing NBA basketball fans and esports fans,” Solomon said. “It’s a way to engage with that audience on platforms that they’re playing on day-to-day—platforms they’re most familiar and comfortable with. The data in traditional sports would suggest there’s some shifting of viewership away from traditional channels to online streaming and following through social media. The NBA 2K ELeague and esports will help to satisfy that natural transition for millennials.”
Blizzard Entertainment recently told AListDaily that the new Overwatch League will open up regional and local sponsorship opportunities, as well as hometown fan bases.
“Our aspiration is for MSG to be a strong brand in New York and for CLG to be a New York esports organization,” Solomon said. “The initial reaction to CLG on social media from people who live in New York City has been that they want them to be their local team. We intend to invest meaningful time and energy to build out fandom and awareness here in New York City.”