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Tapping E-Sports in China

With 400 million highly engaged fans, China is the world’s largest market for e-sports, but government regulations are complicating fashion’s efforts to seize the opportunity.
Duan Yushuang in action hosting the 2021 League of Legends World Championship from Iceland. Courtesy.
Duan Yushuang, also known as Candice Duan (left), is hosting the 2021 League of Legends World Championship in Iceland. Courtesy.

At a recent Prada event in Shanghai, Duan Yushuang blended in with the beautiful crowd. It would have been easy to mistake the smiling young woman carrying a Cleo bag for one of the fashion influencers milling around the venue — but one of them she is not.

Though Duan does have over 5 million followers on Weibo, her audience is distinct from that of fashion KOLs (key opinion leaders, as influencers are known locally) who can boast similarly high follower numbers on Chinese social media platforms. As an e-sports broadcaster who simply takes an interest in fashion, Duan is a gaming celebrity in her own right and a valuable conduit for brands like Prada, Dior and Versace as they try to tap into China’s colossal e-sports opportunity.

As the host of the League of Legends Professional League (LPL), she is the face of an industry that was worth 147 billion yuan ($23 billion) in China last year, according to consultancy iResearch. The country is already the world’s largest e-sports market, with 400 million professional video gaming fans, according to the state-run newspaper People’s Daily.

Duan — who also goes by the English name Candice — is currently in Iceland, hosting the League of Legends World Championships, which runs through to Nov. 6. The tournament was initially meant to be held in Shanghai, but was moved last minute as travel restrictions made it difficult for competitors and affiliated staff to travel there.

The role she occupies bridging e-sports and fashion is to extoll the virtues of the former as an area of interest for the latter and to make herself as visible as possible when she wears the products of brand partners. Broadcasts of the championships that Duan is currently hosting will be viewed billions of times in China.

“I think the audience for e-sports isn’t as narrow as many brands might assume. It’s not just [nerdy] boys; there are a lot of girls, and a lot of those girls are also very knowledgeable about the [top] players [who are seen as] idols. Personally, I still don’t think many luxury brands know much about the e-sports industry,” Duan said.

The marketing proposition is attractive in theory: E-sports fans are likely to represent an untapped reservoir of first-time customers for many luxury brands as fans aren’t currently among their most loyal or frequent buyers. It represents a small existing customer base for a few luxury players but one that could grow significantly if users can be persuaded to spend more on either physical or virtual goods.

Despite the unparalleled scale of China’s e-sports community and some commonalities with its counterparts abroad, it must be approached as a unique subculture with its own codes and tendencies, which feed into a consumer profile that fashion brands need to study carefully if they are to convert increased brand awareness into revenues. The learning curve doesn’t end there, as China’s e-sports market is also going through a period of uncertainty, presenting brands with a unique set of challenges and risks.

Brands Sense an Opportunity

A number of fashion brands, including the aforementioned luxury players, have already dipped their toes into the e-sports pond, whether in China or globally.

Louis Vuitton’s collaboration with the League of Legends World Championships in 2019 was a multi-faceted affair that not only saw artistic director of women’s collections, Nicolas Ghesquière, design unique champion ‘skins’ for use in game, but also a real-world capsule collection. Louis Vuitton also created a one-of-a-kind trophy travel case to hold the Summoner’s Cup, awarded that year to Chinese team FunPlus Phoenix.

Gucci, meanwhile, has teamed up with several e-sports platforms to create a slew of virtual clothing and accessories for avatars, including Tennis Clash, The Sims, Genies, Roblox, Pokémon Go and Animal Crossing, along with its own Gucci Arcade, a section of the brand’s app that features Gucci-themed games, which the brand debuted in 2019.

Since 2020, Dior has collaborated with Chinese e-sports superstar JackeyLove, real name Yu Wenbo, as a “friend of the brand” (the brand’s own parlance), by inviting him to collaborate on an Air Dior capsule collection of ready-to-wear and accessories. The brand later extended this collaboration to sponsoring the rest of JackeyLove’s team, Top Esports, outfitting its players in classic men’s suits for the award’s ceremony of one tournament, for example.

The LPL's Top Esports team wears Dior suits as part of a sponsorship arrangement. Courtesy.

In a statement to BoF outlining its e-sports strategy of focusing on working with top players, Dior said that “in-depth cooperation with famous e-sports players can help attract young people to pay more and more time and attention [to brands]”… and that “star players become the bridge connecting events, clubs and the brand.”

“I think all kinds of luxury brands can cooperate with League of Legends. Maybe I can’t afford to buy a Louis Vuitton [product] in real life, but if I can buy Louis Vuitton skins in my video game, if [I am wearing] Prada, Louis Vuitton or Dior [in the game], that could make me feel more confident, happier with my game,” Duan said, adding that she doesn’t believe most brands have fully grasped the extent of the e-sports opportunity.

The China Gaming Industry Report estimates more than 46 percent of gamers in China are women, though the professional ranks are dominated by male players, many of whom sport the soft, boyish appeal that has driven China’s xiaoxianrou (little fresh meat) celebrity phenomenon for years, making them natural idols in the eyes of young female fans.

Though it seems like a straightforward enough proposition for brands to pursue once they better understand their new audience, 2021 has thrown up some significant complications to e-sports opportunity.

Government Restrictions Cast Doubt

In September, the National Press and Publication Administration, China’s top watchdog for gaming and other forms of online media, implemented a new rule, limiting gaming for players under 18 to one hour per day on Fridays, Saturdays and Sundays.

Though the majority of China’s gaming population is aged between 20 and 30, according to a report from mobile analytics provider, Mobvista, many of China’s most famous e-sports superstars were scouted for professional teams in their mid-teens, a practice that will be nearly impossible under new regulations, and which many believe threatens the country’s future as a professional gaming powerhouse.

According to Michael Norris, senior analyst at Shanghai-based market research firm AgencyChina, uncertainty about the future of e-sports in China due to the new regulatory environment combined with comments in state-owned media that video games are akin to “spiritual opium” makes China-based activations in this area risky.

Worldwide, brand engagement with the metaverse is going full steam ahead, but in terms of brand participation in e-sports here, the foot has been taken off the gas.

“Worldwide, brand engagement with the metaverse is going full steam ahead, but in terms of brand participation in e-sports here, the foot has been taken off the gas,” he said.

It’s not just limitations placed on youth gaming making life difficult for brands in bed with China’s e-sports industry. Nike became the exclusive apparel sponsor of China’s LPL in a four-year deal signed in 2019, but following controversy about the brand’s stance against using cotton sourced from China’s Xinjiang region due to allegations of forced labour in March, Nike logos were obscured on LPL broadcasts (it’s unclear whether this was by government decree or a pre-emptive move from the league to avoid regulatory trouble). Nike did not respond to BoF’s requests for comment, but according to recent local media reports, the brand remains a strategic partner of the LPL.

Since China is currently a marketing minefield in terms of both risks associated with celebrity brand ambassadors and slights (perceived or otherwise) against Chinese consumers, it would be understandable if brands take a safer path or pause major e-sports activations until there is more clarity on recent regulatory implications.

This said, the future may not be as dim for the sector as some have predicted. As Norris points out, an official ban on gaming may not work to dint their popularity among young people, even giving them the added cachet of “forbidden fruit”, making e-sports activations an edgier choice for brands willing to take the risk.

Though children will be cut off from gaming accounts linked to their own ID after playing one hour, three nights a week, there will likely be ways to thwart the restriction, for example, by playing games linked to a parents’ IDs, or making use of virtual private network (VPN) apps, to circumvent the regulations.

Moreover, despite the limits on underage gaming, there are signs that China remains otherwise officially supportive of e-sports, Duan suggests. The world’s first 7,000-seat stadium dedicated entirely to competitive video games has opened in the southern city of Chongqing. Playing e-sports was also officially recognised as a profession by China’s government in February and the 2022 Asian Games, to be hosted in the eastern Chinese city of Hangzhou, will feature eight e-sports titles as medal events, including League of Legends, Dota 2, and FIFA.

This said, for Norris, the uncertainty and potential risks mean that he advises most brands to play it safe in the immediate term.

“It’s time to take a breather,” he said. “The uncertainty is too great and the relationship — both the Chinese state’s relationship with gaming and the brands’ relationship with gaming — is too complicated.”

JackeyLove worked with Dior on an Air Dior campaign. Courtesy.

Some brands, however, seem unperturbed by the uncertainty, with a spokesperson for Dior saying the brand is actively looking into new opportunities in the area, following the success of its early forays with JackeyLove and Top Esports. High-end Swiss watchmaker, Roger Dubuis, which has already launched two limited edition LPL models of its Excalibur Spider timepiece, similarly says it is looking to continue its relationship with Chinese e-sports.

All things considered, the high stakes of the current battle for market share in fashion’s largest market makes every competitive advantage count. In what is also the world’s youngest luxury market, tapping into youth-focused sports and sub-cultures will remain extremely important to the future fortunes of most brands.

“Forbidding children from playing computer games won’t stop them being passionate about games,” Duan points out, adding that many people (herself included) only begin engaging in e-sports and gaming at college, when they are over 18 but have a significant amount of leisure time.

“It’s a popular social activity,” Duan said. “[And these] 20- to 30-year-old players, they have the ability to buy luxury brands.”



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The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.
The State of Fashion: Technology
© 2022 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions and Privacy policy.
The State of Fashion: Technology