Esports – US Market Report
The US, as somewhat of an originator of the Esports phenomenon, is one of the most important Esports and gaming markets in the world. While currently it’s not the fastest-growing market, it is home to a majority of Esports game developers and hardware companies. Plenty of high-profile events also take place in the US.
However, the structure of the market is very interesting and has changed a lot in this decade. Let’s shed some light on the new demographic and the overall figures.
America is home to 160 million gamers, or roughly about half the total population. In other words, 61 percent of the US online population (294 million) play games. Of that number, some 105.5 million are paying gamers (Newzoo), who on average spend $224 yearly each. All this adds up to the United States as the second largest gaming market in the world. The largest market? China, of course, but only barely. The US gaming market generates about $25 billion in revenue (Newzoo.com), while the Chinese market is worth $27.5 billion. The US market is projected to grow by 6 percent over the previous year’s $23.6 billion.
Others, like PricewaterhouseCoopers put forward a more conservative estimate of $15 bn. in 2015 with a projected growth to $19.6 bn. in 2019. Some are more optimistic still: The Entertainment Software Associations claims that the US computer and video game industry generated $30.4 bn. in revenue in 2016. (http://www.theesa.com/article/u-s-video-game-industry-generates-30-4-billion-revenue-2016/). These differences are likely due to different methodologies and scope, but the growth projections are similar – from 5 to 7 percent, indicating a healthy and a mature market.
Half the gaming revenue comes from the console market. The other half is shared between PC and mobile gaming, with mobile gaming slowly edging out PC gaming.
About 40 to 45 percent of total video game demographics are women (IDSA/ESA), depending on the year surveyed. A downward trend has recently been observed, reversing the 2014 trend where 48 percent of all gamers were women. This could be due to lower interest of women for certain kinds of games, lower popularity of tablets and other casual gaming devices, or due to their dislike of competitive Esports that has gained ground recently. Again though, it’s possible that what we’re seeing is a random, short-term dip. The proportion of female gamers is higher among mobile gamers, where they make up 48 percent of the total gaming population. The gender ratios are not equally distributed among genres. The proportion of women is highest in social and puzzle games, and lowest in racing games and tactical shooters.
The most populous gaming population is the 21-35 age bracket in both genders. 47 percent of US gamers are between 18 and 49 years old. Male gamers are younger than female gamers: the average for men is 35, while it’s 44 for women. Women are more likely to be casual players than men. 41 percent of women game regularly. The figure is 59 percent for men. Gaming is a social experience for many players. More than a half reported that they play with other people, most often friends and family. Curiously, as much as half of all US households own a video game console (source:The ESA). Half of all US gamers watch some kind of game walkthroughs or ‘let’s play’ videos on Twitch or Youtube, for example.
When it comes to Esports, as opposed to gaming in general, the US still holds the crown as the largest Esports market with staggering growth rates in excess of 40 percent. The overall 2016 Esports market value is $175 million, according to Newzoo data. That is just shy of 40 percent of total worldwide Esports revenue, which hit $463 million last year. It is predicted that Esports market revenue will amount to $257 million in 2017. Their data does not include Esports betting and fantasy revenue. However, Esports betting is largely illegal in the US, so these figures can be considered largely accurate.
Online gaming is not as pervasive among casual gamers. It is those players who game frequently that like to play online. Half of such players play multiplayer games at least once a week. According to the ESA, 50 percent of all frequent gamers are well aware of Esports. Social media and videos are the most popular ways of following Esports (45 and 43 percent). Streams are the least popular, but not by a large margin (38 percent). Streams are generally more difficult to access, and they also require – by design – following the event live, which can be difficult if the events take place in different time zones, or last for a long time. Both are often the case.
The total Esports audience in the US reached 42 million in 2016, half of which are Esports enthusiasts, who watch Esports content multiple times a month. The other half tune in once a month to catch up on their favorite games and Esports teams. 72 percent are male and half are millennials. The demographics of Esports audience is therefore much younger and male-skewed than that of gamers in general. 48 percent of Esports audience belong to the 21-35 age bracket. This very young market has great potential for promotion and the creation of lifelong customers.
VR is the next hottest thing in the industry. It was a popular new development in the Intel Extreme Masters in Katowice, where VR headsets could be used to spectate events. 58 percent of frequent gamers intend to play video games on VR. Along with spectating, though, VR is of great interest for gamers. However, there are currently no Esports VR games on the market, and it is quite difficult to imagine this to change in the next couple of years.
Of course, while currently the US has the lead in the Esports market, East Asian markets are expected to catch up and perhaps grow faster than the developed US and European markets. 51 percent of all Esports enthusiasts hail from the Asia-Pacific region, and it is not difficult to imagine the great potential that would come with increased spending of the group.
However, as of now, the US remains the most important Esports market with large average spending per customer, great gaming penetration and a very young and receptive demographics. The growth even in the US is still very strong, as well as the increases in viewership and audience figures. Its demographics is better than that of the Western Europe, and there is still plenty of room for growth. While it is inevitable that huge emerging markets like China will soon overtake the US in the Esports domain, as it did in total gaming revenue, the intellectual capital and large spending will mean the US will remain the most significant player for a long, long time to come.