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Achieving sustainable growth in the midst of esports market correction

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Oliver Niner is the head of sales for PandaScore and he has analysed how the industry did in 2022. He believes that the best will be yet to come this year.

Over the last few years, a lot of talk about esports has focused on the idea that there would be a moment of critical masses: when esports would explode and become what everyone had predicted. As of the time of the communication, esports was a hot topic because it is at the forefront modern entertainment, combining sports, games, pop culture, and other things.

The esports industry will undergo a correction in 2023. The esports industry is no longer a place of easy money and hype.

The changes also have an impact on esports gambling. It’s notable that the discussion hasn’t been dominated by a big-bang theory of growth, with lots of hype and little substance. Gambling is a generally recession-proof business, but esports bets will measure and determine the true essence of growth this year.

Grow the pie sustainably

We’re confident in esports gambling for 2023. This will be achieved through steady and sustainable growth, which has been a PandaScore staple. Operators and suppliers should not rely on the tournaments for growth, but instead offer a robust, comprehensive product.

Oliver Niner is the head of Sales at Pandascore

Operators who signed up for PandaScore by 2022 saw an increase of 33 percent in their overall turnover. The composition of the main market and the side markets hasn’t changed much, but total turnovers have increased. Total turnover in Winner and Main Markets for all of our clients grew 61% compared with 2021.

The side markets bets also increased by 54%, while maintaining a similar percentage of the overall turnover. This shows that new players who only play on main markets are not going to leave behind these markets or products such as player props.

The year 2023, for small operators to Tier-1s will see a constant increase in turnover with the iteration of quality products based on feedback from customers. There are many indicators that the esports industry will grow this year.

The Esports Calendar is stabilizing

Consistency for teams, tournaments and calendars has been difficult to achieve through this initial wave of professionalisation and capital investment in esports. As teams and tournaments came and went, so did the calendar. This led to the franchising of esports (for the better or worse), and more organized competitions that return throughout the year.

Operators can now guarantee more content to bettors by ensuring that there are games in the calendar.

Since a few seasons, the top-tier competitions are more consistent. Now we see that consistency in tournaments of lower tiers filling up any gaps from your A-tier or S-tier.

Counter-Strike now has a competition outside of top-flight for professional teams that can compete for a long time in an environment with global appeal. Central Europe Finals, which will take place in Malta from 16-19 February 2019, is a test of CS:GO’s popularity with betting companies.

Valorant is a betting and esports product that continues to grow. Riot Games competitions are clearly the most popular, but last year we saw an increase in regional and local tournaments. Bettors embraced this trend with enthusiasm. The overall volume of bets on competitions in B, C, and D tiers tripled from 2021-2022, while margins remained at almost 10%.

This will also create a consistent schedule for the top-flight tournaments, and we hope that League of Legends can enjoy the same longevity.

Diversification and Regulation

With good reason, everyone is watching the US market with great interest. Many operators have been the first in market to offer sports betting since PASPA was repealed and state-by-state regulation began.

It is not the same for esports. This is largely due to the inconsistent way it’s legislated, and the different parameters which can either help or hurt the performance of a vertical. Esports legislation that is tailored to the competition calendar and how it’s structured, will be more rewarding than a general sport regulation.

Esports, instead of being a sudden flood, will be more like a constant stream that builds momentum with time, given the correct regulatory conditions.

We also expect to see a diversity in the way data will be provided to users and operators.

Esports is no longer a bargain. Tier 1 operators will be looking to esports specialists with tailored products that cater for audience needs, rather than generic trading instruments as part of sportsbook’s long tail.

The Esports Audience is Still Growing

In spite of market corrections, esports viewing audiences are still increasing, which indicates that customer numbers do not seem to be shrinking. In 2023, sustainable growth will be achieved through partnerships that are based on research, development, and robust products.

We want our operators’ businesses to flourish. PandaScore shares revenue with its partners. We’re not interested in cashing out on asset value now. Instead, we want to invest in the growth of this vertical over the long term. The success of our customers and the vertical in esports is what we care about.

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