 eSports, a show devoted to all things eSports. I'm your host, Catherine North. Today, we're talking about connecting brands with eSports. With me is John Corthinos. Welcome, John. Thanks, Catherine. It's great to be here. Thanks for having me. All right. So, John, what led you to eSports? So, it's a great question. So, for the last 25 years, I was at ViacomCBS. I ran their ad sales division here in Chicago and just saw a lot of different brands activating the space. So, for those of you that aren't familiar with ViacomCBS and what that means, it's everything from Comedy Central to MTV to Spike Television, which is now Paramount Television, Nickelodeon, CMT TV Land, all those different brands. So, I was working with Fortune 1000 advertisers and helping them find marketing solutions across all those different networks, whether it was through linear television, digital, social, mobile, you name it, influencers, experiential, everything. And over the course of time, probably the last two or three years, I just saw a huge shift in the audience where there are too many brands that are still doing a lot of the traditional things, which are just television. It's very easy. People think that it's safe, which it is. But the audience shift is seismic in the younger demographics and the world is changing. And I thought to myself, look, when the merger happened between Viacom and CBS, I said, look, I might want to explore something a little bit different because there's this whole new wave and new movement. I want to be a part of it. So that's exactly what I did. And it might search for my plan B. It quickly became my plan A. So I left, I voluntarily left back in May and started my own eSports company called Inverted eSports. So we are, we connect brands with the space through custom activations, everything from consulting as well as doing everything from soup to nuts. So if you're looking to activate, we certainly have the experience and the know how to do that and working with a lot of brands. So what opportunity do you see in gaming and eSports that made you want to pivot out of your career with Viacom CBS? Yeah, so so I touched on it a little bit with with television ratings going down. A lot of people who are not in this space don't follow those trends and you can see the trends unfolding, right? So when you see, so this is a great slide that that really captured my attention. So back in 2010, which is when we index this, you can see this is they're indexing something called what we call putts, which is persons using television. And what that is is all these different demographics and the decline over through mid 2019. So you can see the use of television, the people that are using television are severely declining, especially between the those bottom three are the two to 34 year old audience. They're going somewhere. They're just not watching television. So we dissected where those where those folks are. And if you go to the next slide, we found that 42% of them are either playing video games or watching others play video games. That's a pretty dramatic shift. So if any of you have kids or you have nieces, nephews, or you might be in this group as well, the Gen Z's and the millennials. So this chart says 13 to 34 year olds. That's massive. When you compare that to television, it's 9%. Okay, that's, that's enormous. They don't really grow up with television. They're not growing up with television. It's a complete seismic shift. So when you look at the marketing dollars, which on the next slide, we'll take it through and these are slides that we use in a deck when we present to clients or agency folks. So if you take 9% of the Gen Z and millennial media diet, $59.4 billion is spent trying to reach them. When you compare that and contrast it with the Gen Z and millennial media diet of gaming, which is either watching or playing, only $1.5 billion is spent going after them, presents a massive opportunity. That's why I left. That's why you created the company I did and started talking to some of these brands and hopefully shift their mindset into getting out of the traditional way of doing things. So going back to that, that time when you left Viacom CBS, how did you, were you a gamer? Is that what led you to eSports or was it something else? So thanks, that's a great question. So I've been a gamer since I was a little kid. My parents yelled at me to get off that thing. I'm going to date myself. I started with Atari. I moved quickly into it in television and every iteration from Clico vision all the way through the sagas and the Nintendo's all the way through. So it's always been in my background. It's a great time suck for me if I wanted to just get away and do something. So I've always had an eye on it and an interest in it. So it was really easy for me to pivot into it and find a passion. It's a strong passion point for me. So I had a pulse on it long before this movement ended up happening, but I love the current movement. I think it's great. I'm finally in my sweet spot exactly, to put it mildly. Absolutely. So how do you help advertisers embrace the space, especially those who aren't familiar with it or don't normally engage the audience? Yeah, so it's tough. It's really tough to do that because look, a lot of the people that are in the space are controlling hundreds of millions of dollars. So the crafts, the Kellogg's, the General Mills, all these different places and they have their very set in their ways and television is working for them. And you're trying to convince them to go spend money in a different way. I will tell you that COVID plays a big role in this right now. You would think that it's just a boon of windfall of money just coming into the space. And that's simply not true. The popularity of esports and gaming certainly has fueled the headlines and put it on the map and increase the awareness of it. But there's a reality in there where folks are in charge of all this money. If you walk out your door, if they walk out their door and they look to the left down their street, someone's probably on furlough to the right, someone's probably being let go. There's a lot of risk version in this business. So it's really hard for them to all of a sudden say, Hey, we're going to take a chunk of this money and move it into esports. And let's test and learn, as opposed to saying, let's keep doing what we continue to do. And that's the tried and true and television and everything else, yet they're not reaching the next generation of their consumers, which is really concerning. So it's my job to ease into them. We do 101 decks and say, This is what's going on in the world. How can we help? And we start small, we can we've done budgets that are $50,000 up to $1 million. And you can go well beyond that as well. But it's and obviously, we're limited to what we can do because a lot of these events that are that would take place in venues and things across the country and around the world have been excuse me have been stopped just because of COVID. So it's it's this crazy intersection. We generally there's a lot of hand holding, there's a lot of convincing, but nothing gets them more excited or more paranoid, I should say, when their competition is there. And there's more and more of that. It's interesting to that some are the smaller brands, the more nimble brands are willing to take these risks versus some of the bigger brands, which is I think indicative of just the way big politics work at major corporations, not all of them, but some of them. Yeah, so I love this a lot of people. This is a great slide in mind our deck that really gets people thinking so this slide. So this is Nielson and we did the average viewership on a minute by minute basis for all the different traditional sports leagues. Well, when you look at 18 to 34 year olds and the NFL, by the way, that's just a regular season game. When you come when you put in and compare the eSports to all of this stuff, League of Legends is the third highest and most popular among this demographic. Moving down a little bit further, the seventh one is Overwatch. And then there's another version of League of Legends. That's for the amateur players. So three out of the top nine are the biggest eSports in 18 or the biggest sports among 18 to 34 year olds. A lot of people their eyes pop up like, holy cow, I had no idea it was bigger than the NHL and golf and everything else. So it's a great slide. Now, that was a year ago. I would be I would love to replicate that slide because the Overwatch League just ended and their ratings were through the roof and League of Legends is going on. Currently, you know, it's just massive. So I would love to compare that in today's world. You know, it would be also interesting to compare NBA 2K and NASCAR and some of those those games that have been shown or, you know, during COVID, you know, because because there's been so much viewership during COVID that there wasn't last year. Yeah. And what's interesting too about the NBA 2K, I remember going on ESPN 2 during the pandemic, early on in the pandemic and I was flipping around just looking for something to watch and all of a sudden I was watching an NBA 2K game and it really hit me. I'm like, oh my God, this is on broadcast table and it's really fun. Those don't necessarily rate. It's really interesting when you put stuff on television. It doesn't rate as high as the traditional media that these kids are growing up with, which is obviously Twitch and YouTube gaming and everything else that's around there. So it's interesting. You'll see that on television and folks are age will say, oh my God, I can't believe that. Now I get it. But when you look at the ratings, it's not moving a needle. When you look at the Twitch streams and everything else, that's where the real gem is and where you can monetize. So what's inverted value proposition for brands and how do you differentiate yourself? Yeah, so nobody this is, I hope this doesn't get broadcasted to many people because I don't want to give away our secret, but I'm coming at it from a I think a unique angle. That's the feedback that we're coming at it from. No one's going after media budgets. They're all going for sponsorship budgets. To me, sponsorship budgets are, hey, business is doing great. We have so much extra money. Let's do some sponsorships. Unless you're Molson cores or Anheuser Bush and you're like, hey, I want to go sponsor that stadium, right? And there's, but most companies are going to say we need to get eyeballs and drive awareness to our product, drive favorability, drive intent, drive whatever they're going to drive conversion. So what I'm doing is saying I need you guys from a media perspective to take this seriously because the audience isn't there. So I focus on the audience rather than the bells and the whistles of eSports in general saying, hey, if you just shifted a million dollars out of your hundred million dollar budget, hellogs making that up, let's go test and learn and let's see what that does. And if it does pop and you find it worthy, then it's great. The other thing I love about it too is when I used to work at Viacom, the Kids' Choice Awards at Nickelodeon was something I sold. So is the Video Music Awards on MTV. Well, it was really nice to sell those. Those are massive properties, but you're always working within a box, right? So how can we work it? So whatever I gave to anybody, whatever I presented, worked within their KPIs and we had to fit that into the actual the scope of the experiential program. In eSports and gaming, you can go and say, we can do almost anything. So our value proposition to answer your question, it's a long way of getting there, is we start with brands KPIs or Key Performance Indicators and then we work agnostically across the entire ecosystem to try to find the best solutions for them. So we work with everybody, but we don't perpetuate any team, player, influencer, venue, leagues specific agenda. We're really trying to solve for X, your X for KPI, and we're going to go do that depending on what you're trying to accomplish and where you are in the funnel. So would you differentiate between an endemic brand and a non-endemic brand when you do that? It's harder for the endemic brands because they know what they're like, not necessarily, but it's more fun to do it with the non-endemic brands because they're discovering the space where the endemic brands know kind of what to do and where their sweet spot is. The non-endemic brands are much more fun. We're working with a feminine health, feminine hygiene product right now. We're working with a baby product. I mean, that's what I love. Like let's try to figure that out and how does that fit into the space and it takes you in many different directions. So I hope I'm answering your question. I think it's more fun to do it with the non-endemic. Yeah, it sounds like it would be. So can you share some more examples of the different ways brands can activate in gaming and esports? Who's doing it right and have you seen some misses? Yeah, for sure. So here are the brand opportunities that I put together for some for your audience. So obviously there's opportunities on jerseys and you can be a part of all that stuff. It's pretty static. Some people love that. Other people are like it just feels a little NASCAR. But that's something that people can get involved with. Cloud9 is one of the biggest organizations in the world. They teamed up with BMW. A number of different teams, actually five total teams. They gave them free cars in exchange for content creation and all sorts of different things. The other one, those are Herman Miller chairs at Complexity Gaming in Frisco, Texas. That's the Dallas Cowboys Organization, Esports Organization. Those chairs are $1,600 a piece. I think you can get them for $1,250 if they're refurbished. But those are all outfitted in their training facilities. So those are really super high-end stuff. State Farm did something that's really traditional. They did something called the Analyst Desk for League of Legends. That's Totino's on the left-hand side. Matthew Haag, or Haag, excuse me, is the owner of 100 Thieves. They do some, and I'll get to that in a second here, but that's just a brand integration. Tyler Blevins, that's Ninja. He's probably the biggest name in the space. He did a big deal with Puma. The bottom left there, Doritos. You could do unpack promotions, which a lot of folks do. Kellogg's is really big on that too. So the new Call of Duty game is coming out next week. If you buy Mountain Dew or Doritos or Pringles or whatever the case may be, you can go to their website and log in a code and get double experience points. You can get skins within games. You can get all sorts of different merchandise within the game. The League of Legends partnered up with Buffalo Wild Wings. This is more in your legal world. There's a patent out there for being the official bar for esports, which I think is really cool. Don't discount all these high-end brands either. That's the League of Legends trophy. It comes in a Louis Vuitton case. Yes, they are involved in the space. In the middle, on the right-hand side, that's MasterCard in-game in League of Legends. They are really involved in League of Legends, which, by the way, is the biggest game on the planet. Then my favorite is the bottom right, E3 last year. Molson cores came out with their CanTrollers. After you finished your Miller Lite, you could bluetooth that to your Xbox or your PS4, and you can actually play games with it. It's more of a gimmick, but it does work. In addition, these are all ones that work. In addition, if you can go to the next slide, my absolute favorite, which just came out, that's Stevenage on the left-hand side. You're viewers and you probably have never heard of it. In fact, if you were a huge English soccer fan, the only thing you would know about the Stevenage Soccer Club is that they are the absolute worst team in the entire League. But Burger King, because they don't have the budgets of McDonald's, this is an example where I think it's just amazing and a good stretch of dollars. So they have to compete with McDonald's. They don't have the McDonald's budget, but what they did was they went to Stevenage and they said, we want to sponsor you, and we want to put our logo on the center of your jerseys. They said, no problem. Well, they knew that that team was going to be included in FIFA, the new FIFA game, FIFA 2021. So what they did was every time that you scored a goal with those players, you could upload it to Twitter and win all sorts of different or qualify for different discounts and prizes and all that other stuff. What people started to do was trade their favorite players from Manchester United and the best teams in soccer to Stevenage. And they got so many uploads that it went absolutely viral and it was the funny, it was the craziest thing. So the Stevenage Soccer Club won because they got a sponsorship. They actually sold out of all their merchandise. Burger King hit with gamers in a massive way and drove participation, which I think was really, really smart. So and then you look, you can do team sponsorships. That's the San Francisco Shock. They just with that logo on the bottom left. They just won the Overwatch League for the second year in a row. Hyper Race, which is a really cool product. They sponsor them. It's really for pro athletes and everything to get you back into the game faster. So if your back hurts, you can do something and put it on your back hurt like those things that kind of like punch your muscles and get you back into the game. Well, they have something for gamers as well. Zaxby's 900 stores across the country, mostly a Southeast SKU. They did something with the Florida Mayhem as well as the Houston Outlaws. Those are two teams in the Overwatch League that were regional. So you can do things regionally just because you're not in a national brand doesn't mean you can't get involved. On the upper right hand side, that's Weathertech. They're in game ads. That's Forza, the new Forza game that's coming out and one of my favorites, Dr. Lupo. He's Dr. Benjamin Lupo. He is not a doctor. He is just an awesome streamer. He does a charity stream with St. Jude, which was really fun in Fortnite. Everybody that got together on Fortnite could tell him what to do. Like if he just picked up the best sniper rifle and he's running around or a rocket launcher, someone could be like, oh, well, you have to drop that rocket launcher and I'm going to donate 10 bucks and he had to survive and he's really excited about getting the best gun in the game and all of a sudden someone on stream pays him to drop it and he has to win the game. So he was, he raised over a million dollars. It was such a cool stream. You asked the question, who's doing it incorrectly? I put this up here. So I love the Proctor and Gamble group. Their brands are amazing, but I think this was a miss for these guys. This is bounty and it's basically a streamer and it was very contrived. So in eSports, there's two ways to go. You can control the narrative and perpetuate that or you can let the brand and the have fun with the participants. They did the former. So they went in there and these three people are talking, it replicates like a Twitch stream. He does something with his mouse. Everything falls over. I think it's cute. And he's like, oh, my God, like, thank God, bounty's here. I'm going to wipe up my spill and do all that stuff. Well, in the middle of that page, you can see, I think there's, I don't, it's too small for me, but if you look at the number of likes and you look at the number of dislikes, the number of dislikes were just like, hey, this, this doesn't feel authentic. It doesn't feel right. So, uh, and I use the word authentic. I didn't know I was going to do that, but anybody in eSports, I will tell you, like, it's so overused, but it's so, it's also incredibly true. So that was just, I think, a messed up. Now they do amazing things with other brands like Gillette and other things. So I'm not picking on Procter & Gamble, but this was just one in particular that just didn't resonate with the audience and they let you know that. Sure. And yeah, I mean, it's interesting because everything I hear about branding and marketing in eSports, the word authentic is used. So what are your thoughts regarding authenticity since you let the cat out of the bag? Look, I think one of the, there's someone to answer that in a little bit of a roundabout way. I think authentic means a lot of different things to different people, but I think what, what people in this space really gravitate towards, is having fun with brands. Are brands willing to have fun with what we're doing? And I think that Totino's is one of those that absolutely accentuates that. Totino's had one thing where they could say, look, we want to be the gaming snack or the pizza role of gaming and they're going to go perpetuate that agenda and plug in all sorts of different things in pay streamers to say all that stuff. Instead, their CMO who I think is brilliant said, you know what, we're going to have fun with the audience. We're going to give this to a hundred thieves, the whole team and we're going to let them tell us how they interact with the brand. We're going to learn in the best possible way and the best focus group. So now you are empowering this entire audience. The brand has to relinquish some of its, like brand safety is not the right word, but, you know, the fun and the personality of the brand and it's not for everybody. Right. The crust toothpaste probably doesn't want to do that. Nor is it a brand that I think would gravitate towards, you know, that kind of environment. But someone like Totino's said, no, we're going to learn a lot. Cheetos can do something like that and say, hey, let's, you know, and then they they took all the little, you know, the Cheetos and you're like, wait, that looks like a giraffe and it looks like a drumstick and, you know, people are having fun. Everybody in this space wants to gamify their experience. They want little fun things because they're gamers in general. So how do you play off of that? By doing that, I think you achieve authenticity and you're true to your brand and yourself. Okay. And a viewer asked, what is the difference between what you are doing before and your current company what you're doing and your current company? Is there a difference? Sure. In my old job, I was confined to what I had to do. I was working within a box. So I sold the daily show on Comedy Central. A brand would come to us and say, we want to do X, Y, and Z. I was up against all sorts of different competition, whether that was on Turner or NBC Universal, ABC, anything like that. And we had to price it out and come up with the most creative stuff in doing that. In my current job, it's almost like, well, what do you want to do? Because I can do almost everything. And we're really putting it's I'm much more nimble in what I can do and execute and I'm having a lot more fun doing it. Not that my old job wasn't fun, but we have the latitude to do what we want to do without going through 13 approval processes here. Let me let me bring it home for that viewer. We looked at Kellogg's one time and they wanted to paint orange on the orange carpet for the Kids' Choice Awards. They wanted to paint Tony the Tiger Stripes on that orange carpet. Well, and they were going to pay a considerable amount of money to do that. Well, it took 13 approvals it never ended up happening because we were paying too much with the compromise in the integrity of the show and what it was all it was just crazy. And I'm like, guys, wait, this is so fun. This would be great. But it goes above and beyond all those things and everybody internally at Viacom had great reasons to do that. But it was it's like, you know, I felt like I had handcuffs on here. It's just getting back to, yeah, we can do that. I can absolutely do that. And what else can we do? And it's super fun. So it's almost like telling brands, why don't you write the deck the perfect deck for you on what you want to happen? And let me go execute that. And I can do that. And my old job, which was great. I loved it. It's it was just an inhibiting factor that I was just, you know, it gets frustrating after a while because you want to do all these things that you seem to make sense I'm a sales guy at heart. So I'm like, why can't we do that? Let's figure out. Like, don't tell me no. Let's find a way to yes. And there's a lot of different reasons to to get to know whether it's legal or or a bunch of other different reasons. Sure. And how long how long it has your current company been operating? May. Oh, okay. We're brand spanking new. Okay. The same viewer asked, what's it like to start a company during a pandemic? It's wild. It has a lot of ups and downs. So I decided to leave in October and started the company in May. So full disclosure, I didn't start it in the middle of I did start in the middle of a pandemic, but my thought process was well earlier than that. I had my mind made up to do that. It's tough. It's fun and it's tough because we're all in it together and you have some really interesting conversations, but there's definitely some challenges and business challenges that are at the forefront. But I feel like it's going, so I'm on the trajectory. I'm riding this wave of sports and gaming. And by the way, one gaming is 160 billion dollar business. Esports is 1.5 billion. So gaming is much bigger than esports in general, but you're riding this wave up and I think everybody's embracing it or at least willing to have a conversation. So I think in a year or six months, we're really going to start seeing the traction come through and people are going to have the confidence to say, all right, I want to test and learn. I'm going to free up some of those budgets. I think the economy, I think the, you know, what's going on with COVID is going to be a little bit more in focus and be more favorable to the environment and the situation. Okay, so let's go back to sports. How would you compare and contrast the organization traditional sports and esports? Sure, I think we've got it. So this is, I put this slide together on my wife's side. It's her favorite slide. So I'm going to, I'm going to roll with that. So this is a really simple chart on how everybody can visualize this. So if I'm playing basketball or if we look at the game of basketball, there's the league, which is the NBA, the team is the Golden State Warriors, that's Steph Curry and the media platform that would air on as NBC. We all get that. It's super easy, right? But in esports, it's a lot different in one aspect. There's a publisher involved. So let's stay with basketball for a minute. Kevin, if you and I wanted to go play basketball, we could find some great court in Honolulu under the 80 degree sun right now, which I'm jealous. And no one can tell us where to play, what shoes to wear, what ball to play with, how long we should play, any of those rules, right? Well, it's much different in esports. So while you have the game, the league, the team, the player and the media outlet all the same. The publisher controls everything. So for instance, Activision Blizzard controls everything with Call of Duty. Well, they control everything about it, including the maps, who does what, the skins within the game, the playlists, whatever the case may be. So if you and I wanted to go play Call of Duty right now or do a tournament, we couldn't do that. I mean, we could if it was, you know, you're in your house and my house down the street and somebody else, no one would care. But if we did something at some huge arena, they would slap a cease and desist on us faster than we can shake a stick at because they own the rights. There's not that entity on the other side of traditional sports. So that's why when people are like, oh, I can't wait for this to be in the Olympics. These will never be in the Olympics, not as an Olympic sport, in my opinion, because these publishers own those rights and why would they ever relinquish those rights for the greater good of anybody without monetizing anything. So that's the one inhibiting factor for all of these, these eSports, they control everything. So we need to wrap the set, but how would someone be able to contact you if they're interested in talking to you about marketing or advertising their brand in the space of eSports? Sure, you can, you can check out the website, which is www.inverted.gg or you can do my first dot last name at inverted.gg You can do that. I'm happy to give everyone my contact phone number as well, which is 312-296-6821. Happy to talk to anybody if it's, if it's not just, even if it's for a 101, I'm happy to educate anybody and take them through the larger deck. These are just slides that were out of that. It's fun, it's entertaining, there's a lot more video in it than static slides, so it's much more entertaining to hear me talk, but that's, that's how they get ahold of me. Well, John, thank you so much. I've learned a lot and thank you everyone for joining us today and thank you for the viewer who sent in the questions. Next week, my guest will be former professional eSports player Fatality. See you then. Thanks, Catherine. Take care. Thank you.