SWOT Analysis eSports industry

Strengths

 Very big fan base - large demand (around 400million occasional viewers in 2018 according to
www.statista.com
 Holds a strong position in the gaming market. Market research agency Ovum has predicted
that the value of the global esports market will reach $1.9 billion in 2022. This represents a
compound annual growth rate (CAGR) of 20.7%, up from an estimated $733 million in 2017
according to https://britishesports.org.
 Team play involved - character building, teamwork skills.

Weaknesses

 Some violence involved, popular games such as Fortnite, Call Of Duty etc.
 High production costs.

Opportunities

 Job opportunities, the gaming industry in the UK provides 47,000 jobs making it a very
valuable asset in the eyes of the government.
 Ability to easily communicate with foreign video game users enables the UK eSports industry
to also appeal to foreign gamers. Esports operates in 35 countries globally. More then 300
million registered gamers worldwide play EA games regularly.

Threats

 Risk of addiction, 2 billion people play video games globally with up to 10% of gamers having
compulsive addiction issues according www.therecoveryvillage.com.
 Risk of confusing the real-world vs the virtual world. Over 80% of children between 9 to 17
own a gaming console.
 Large competition.
 COVID-19. National lockdown/quarantine may affect the business.

PESTLE Analysis eSports industry

Political

 Wage legislation. Staff wages must comply with the national minimum wage of
£8.90, as of the current rates from 25 November 2020.
 Health and safety legislations. The business must cooperate with the current COVID-
19 guidelines to ensure that the premises are kept safe. The business must also
follow standard health and safety procedures.
 Taxation. The business must pay taxes such as a standard income tax rate, therefore affecting
the business gross income.

Economical

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  Inflation. May affect the business as prices of necessary good could increase and customers
will no longer be interested in paying such high prices for event tickets and promotional
merchandise.
 Recession. Could result in prices dropping leading to lower revenue. Could also result
in increased unemployment rate meaning a decrease in customers who are able to
pay the fees required for booking an escape room (unemployment rate in UK is
increasing and is currently at 4.9%).
 Change in disposable income. If disposable income is low, customers may no longer
be able to pay the necessary fees required for visiting an eSports event. If disposable
income is high, then more customers will be interested in booking tickets and purchasing the
promotional goods.

Social

 Change in taste and trends. The business must constantly be updating the escape
rooms to meet the new tastes and trends in order to interest more customers.
 Too expensive for larger families. Larger groups may be put off visiting an eSports event
as it could be too costly for a large amount of people.

Technological

 Older generation unfamiliar with using online technology. As the company is mainly
managed on the website and online platforms are fundamental to the eSports games, teams
and tournaments, older customers may be put off this option as they are likely to be
unfamiliar with using the internet.
 Social media is becoming increasingly popular. This is an ideal method of
communicating with potential customers.

Legal

 Copyright law (when using themes based on films/games). The business must ensure
that the using of themes based on films and games is done in a safe and legal way
and that any copyright laws are followed.
 Employment law. This business must guarantee that employee`s rights are carefully
met and workers are given a minimum wage.

Environmental factors

 Hazardous weather. Not only can extreme weather cause damage to the company
premises, but it could also lead to a loss of revenue from the business interruption,
resulting in a financial deficit long after the extreme weather has ended. An
important strategy to avoid this is to ensure that the business is prepared for any
disruption caused by extreme weather.
 Workplace efficiency. If staff do not carry out the correct tasks which enable the
business to operate then the company will lose out from customer satisfaction and
lower reliability affecting the business reputation.

Marketing Mix (7 P`s)

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 Price
Product
Process
People
Place
Promotion
Physical environment

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