Luxury Brands Chase the Esports Opportunity in China

In addition to a millions-strong community of gamers and tech companies both domestic and international, a handful of luxury brands are entering China’s booming esports sector. It’s perhaps no surprise why, owing to the rise of esports in the market — the number of gamers reached 540 million in the first half of 2020, and the industry generated $10.3 billion in revenues — and the fact that China remains virtually the only bright spot for luxury in 2020. Louis Vuitton has been in the lead with its trophy cases for League of Legends championship events, and also created capsule collections and virtual skins for players of the hugely popular game, while other brands such as Dior have tapped the ACG (Anime, Comic and Games) community. Now, the digitally savvy Burberry is the latest to join in the fray through its newly announced partnership with Tencent Games on its multiplayer online game Honor of Kings. According to Burberry, the partnership looks to leverage the increasing importance of interactive digital content in inspiring luxury consumers, noting that “games offer another opportunity for consumers to connect with Burberry’s products online.” While specific details were not released, the company added that the collaboration will center on virtual products, calling it part of “Burberry’s digital agenda.” Burberry’s collaboration with Honor of Kings comes after a year in which the brand has increased its digital and interactive marketing efforts in China, which included the opening of a “social retail store” in Shenzhen with Tencent in July and the release of three mobile games, B Surf in July and B Bounce and Ratberry in late 2019. The CCI take is that we will likely see a significant rise in the number of luxury brands jumping on the esports bandwagon in the next one to two years. The fast-growing number of gamers in China, and the buzz generated by luxury automakers such as Ducati , Maserati , and Rolls-Royce and other premium brands such as MAC Cosmetics (which launched a lipstick collaboration with Honor of Kings that quickly sold out) or Canada Goose means the risk is relatively low. While it remains to be seen whether esports collaborations have any real revenue-generating upside, as a marketing vehicle they remain a relatively safe bet.

Luxury Brands Chase the Esports Opportunity in China

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Published November 10, 2020

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Luxury Brands Chase the Esports Opportunity in China