Eliott Cheeseman, esports attorney with Hall Webber LLP, discusses the challenges — and opportunities — for esports organizations as they negotiate or reevaluate deals during the pandemic.
The COVID-19 pandemic has far-reaching effects on the world, and the esports industry is not immune. While the lack of in-person events has hampered sponsorship activations, lockdowns have yielded an explosive growth for livestreams and other esports activations.
In addition to the virus itself, uncertainty has plagued industries and individuals, causing many to feel lost or left behind. There is good news, however — agility can not only help your organization to survive these unprecedented times but to thrive.
NGame Esports sat down with esports attorney Eliott Cheeseman to explore the many ways that esports organizations can be proactive during these uncertain times.
NGame: With the pandemic creating uncertainty in traditional sports, do you expect more sponsorship dollars allocated to esports in 2021?
Eliott Cheeseman: I would assume there are a lot of brands out there that traditionally activated in the traditional sports space that are now looking at the esports space. With traditional sports on hold or [previously] on hold, brands started to look for other ways to engage with their community and consumers.
The logical step would be to throw some money at esports because it’s kind of the same space. It aligns with their brand the way a traditional sport might, but the audience is a little different— it’s a little younger. With traditional sports being on the shelf or the uncertainty of their scheduling, brands have had their eyes opened to the possibility of engaging with consumers through esports and streamers and influencers.
NGame: As esports teams review new sponsorships opportunities for 2021, what should be included in the agreement to navigate during these pandemic times?
Eliott Cheeseman: Make sure that you’re not still using your standard agreement during the pandemic — you need to have something specialized or reviewed and edited, given the circumstances we’re in right now.
Make sure you have [agreements] reviewed by a lawyer. Think about all the possible outcomes, consequences, or issues that may arise during the pandemic for any given activation and make sure that the key terms and keys issues are identified in the contract explicitly with a number of contingencies put in place.
When the pandemic hit in the esports and the business world, a lot of “force majeure” clauses were invoked or attempted to be used by either party of the contract. Any agreement that you enter into won’t be affected by a force majeure clause the same way because both parties are entering with the agreement know that they’re in the middle of the pandemic, and things might unfold differently.
NGame: How can esports teams review and update current sponsorship deals as the pandemic may have impacted their ability to execute obligations?
Eliott Cheeseman: Make sure that you have explicitly outlined the ins and outs of the activation, sponsorship opportunity, or event, i.e., how many activations or influencers or whatever your KPI is for any given sponsorship deal. Ensure that parties are aware that that there is the possibility of things not unfolding the way they are outlined in the agreement and that the parties are okay with whatever alternatives that the parties have come up with.
NGame: Until we are past the pandemic, do you anticipate esports teams attaining one-off deals or long term deals (2 years or more)?
Eliott Cheeseman: I would have to imagine that there are going to be a lot of short term deals in the next little while if any new deals are being entered into.
At the same time, it’s possible that the pandemic has just sped up some sponsors and marketing companies getting involved. 100 Thieves, for example, is a media and content company first, so the pandemic has only brought bigger audiences to the podcast and videos they produce.
Other esports organizations focused solely on the competitive side of esports might be looking at a bunch of smaller, short-term deals during the pandemic given the uncertainty of reach and execution of virtual competitive events.
Even though there aren’t any live events, it would be wise for parties to continue their relationships – don’t burn any bridges. You just have to think of other ways to engage the community and build your brand awareness. That means being as flexible and helpful as possible to any sponsors that marketing companies that you’re currently in deals with.
The content in this article is provided for general information purposes only and does not constitute legal advice, professional advice or an opinion of any kind. Please consult directly with an attorney before making any decision about your business.
written by HB Duran