Fortnite World Cup $30M Prize Pool = Does it Make Business Sense!?!?
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Fortnite World Cup $30M Prize Pool = Does it Make Business Sense!?!?

November 4, 2019

okay so in this clip we’re gonna talk
about whether it makes sense for Fortnite to spend thirty million
dollars on the Fortnite World Cup and doesn’t make any business sense at all
so before we do don’t forget whatever channel you’re coming from don’t forget
to follow us hit a little subscribe and click the bell button if you’re on
YouTube or whatever channel you’re on if you enjoy clips on entrepreneurship
business gaming stuff and more. So let’s talk about this the Fortnite World Cup
that’s actually coming up so people have to think about this right does it make
sense for a gaming company spend thirty million dollars on this World Cup that’s
been unproven you know we talked about the Soccer World Cup everybody knows
about that well here’s the thing think about the Soccer World Cup
why can they spend so much money I think the prize pool for the the winning team
I think they went like thirty five forty five million dollars or something like
that we’re gonna get all this money from and so think about this first
the International which is a valve they basically sponsored the DOTA too and
they spend a hundred million dollars on the prize pools but where they get the
money from valve might put at 1.6 million dollars but a lot of the revenue
they have coming in from their customers their gamers they actually end up
dumping it back in maybe investing let’s say 20 to 25 percent of those revenues
I’m putting it into the tournament with fortnight they’re actually doing it’s
not just 30 million dollars for the the World Cup they’re actually doing
something very similar it’s a 100 million dollar prize pool so how does
that make any sense well okay I just mentioned let’s let’s say Epic Games
they might put up 1.6 million dollars or whatever it is exactly and then from
there though that a kata portion the revenues goes towards that to them it’s
it’s a marketing expense if you think about it this way if we look at my
screen real quick let’s take a look at YouTube real quick so on YouTube I’m
looking at one of the most popular fortnight gamers from gamers in the
world t Phu he’s got 11 million subscribers ok he’s got a ton of
subscribers on Instagram and he’s got a tonne subscribers on Twitch as well so
he is he’s omni-channel I talk about omni-channel
all the time on the marketing school podcast and look at his last video 20
hours ago 1.3 million views and then 1 million views 1 day ago 2 million views
the title was just I’m heated this is two days ago it’s I am heated ok 2
million views and the one before that 1.5 million views that’s four days ago
now Google themselves Google which owns YouTube Google when a larger search
engines in the world or the largest search engine in the world
they said this they said gaming has the highest retention okay by far and watch
time is also the highest as well so people are very engaged and people are
watching for a very long time so the incentives around the search engines and
also YouTube it makes complete sense they want people staying on their
platform longer so people can watch ads for longer okay now the if you look at
fortnight or Epic Games they want more people they want more awareness around
what they’re doing okay so if you got guys like T foo around the world you got
you know people like ninja where they have million subscribers we’re talking
hundreds of millions billions of views okay
even with advertising I mean it’s it’s it’s that’s a really good deal because
not only that twitch is gonna be streaming as YouTube’s gonna be
streaming it everyone’s gonna be talking about this on Twitter okay so the the
lifetime the retention around the this product itself fortnight it extends out
right so it’s worth it because epic is doing billions a year I I think I least
over a billion in revenue so it makes sense for them to have a play like this
cuz it’s because thirty million dollars hundred million dollars especially when
the large majority of that is not they’re not putting up that money to
just using revenue to fund that it’s yes it is their money its but its revenue
they’re using to fund that it’s a drop in the bucket when you think about you
know Gary Vee saying that Superbowl ads are the best deal out there you might
spend 3 to 4 million 5 million dollars on a Superbowl ad but the attentions
worth it because so many eyeballs are on it so again we’re saying billions of
views are getting on top of this and it’s worth it so the other thing I want
to bring your attention to here is if we look at my screen IMG media they’re
gonna be distributing this across the board if you’re on if you’re on a plane
for example this is gonna be distributed to I believe 13 Airlines and then if you
look at my screen over here IMG helps distribute for the NFL the Open
Championship the NHL Major League Soccer NASCAR Olympics and then also what else
we got your Premier League okay software if you’re a fan of Manchester United or
meant just Manchester City they got this too so lots of distribution lots of
eyeballs you got the influencers that are gonna
continue playing longer because they’re involved with this World Cup right so
they’re talking about it they’re gonna be more invested to stay around
especially if they want a couple of million bucks because the the fortnight
World Cup if your solos champion you went three million bucks
if your duals champion you went three million bucks and also they have some
other price pools too and then they’re gonna have these these contests where
each week you can mean the the winner might might take home 1 million dollars
or the prize pool is 1 million dollars so you have a lot of different options
here but it’s keeping the game fresh and it’s keeping more people like more
people gonna talk about right because you’ve got celebrities playing the games
too so in this world do you think about incentives everywhere YouTube okay they
want more people staying on the platform watching longer okay Gaming will
accomplish that so that’s why they’re supporting gaming now fortnight they
just want more eyeballs on it and then you got the influencers and they’re how
do you keep the influencers on there longer you get you you award them you
give them an incentive stay on you give them money right you get they want Fame
and they want money now what I want to show you too is I’m using a tool here
called tube sift if we look at my screen I just searched for fortnight World Cup
and I’m only looking for videos that have over a hundred thousand views in
the last thirty days okay so right here you can see okay
this one has 1.2 million views phase sway destroys undefeated one on one God
okay great that’s 1.2 million views 874 thousand views seven hundred forty five
thousand views five hundred forty-four thousand views this is only me typing a
fortnight World Cup imagine all the other people that are just they don’t
even have a for tonight World Cup in their headline so again I’m talking
probably a billion is a thousand million I think it’s probably over a billion
views that to think this thing’s gonna generate and that is well worth the
money if you think about from an advertising perspective still well worth
the money to get billions of eyeballs on this thing there’s a lot of literature
around this you know fortnight 100 million dollar prize pool what’s
happening right now to this is coming from a press perspective when you look
at what valve has done every single year the constant beating their own record
right so they’re saying oh it’s going to be we’re gonna have the the largest
prize pool and eSports or gaming history hundred million dollars right and then
fortnight comes out with this are like yeah we’re gonna do a 100 million dollar
price a prize pool everyone ends up talking about right so what happens is
you get a press effect – so you got IMG distributing you got the influencers
talked about it and then the press is also talking about it
so it’s creamy this feeding frenzy around this World Cup you got a valve an
epic trying to outdo each other so as soon as I think fortnight announced 100
million dollars prize pool then valve comes back and says okay let’s add one
five million dollars or whatever it is exactly so they try to outdo them so
what’s gonna happen is people gonna try to continue to one-up each other and
this is good for the gaming industry as well because there’s more money coming
into ecosystem right you got people investing in eSports team 100 days just
raised thirty five million dollars for their Series B to continue to grow so
it’s just gonna get bigger and bigger I still think it’s very nascent right now
but it does make business sense to put thirty million or 100 million into these
World Cups because you’re paying for attention at the end of the day and if
your funding it with revenue the way you’ve structured that deal it’s a
pretty good deal at the end of the day so before you go let me know what you
think in the comments does it actually make sense for these companies to spend
so much money on these on these types of these types of World Cups or these prize
pools right I kind of gave you my reasons but you can agree or disagree
with me and also don’t forget to check out the next video okay it’s gonna help
us it’s gonna help you it’s gonna be beautiful and don’t forget to rate
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and we’ll see you tomorrow

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