Liiv Sandbox naming deal gives old bank a new audience

Esports

Liiv Sandbox naming deal gives old bank a new audience

Published: 06 Jun. 2021, 17:43

Liiv Sandbox revealed new uniforms this May via livestream. The team logo was redesigned, and yellow was brought to the forefront of the team's color palette: ″Yellow is the new black″ was the official slogan on social media. [SCREEN CAPTURE]

On the business end of League of Legends esports, 2021 may go down as the year of team-name sponsorships.

While such arrangements have existed since the dawn of the scene — Fnatic RaidCall (2012), M5 BenQ (2012), TSM Snapdragon (2013) and MVP Ozone (2013) among the more memorable — most were short-lived, and never the norm.

In recent years, however, a deluge of non-endemic companies have begun showing interest in multi-year naming rights deals, generally understood to be an easier and cheaper way to secure a presence in esports compared to owning and running a team.

One of the more significant contributing factors was many regions across the world transitioning to a franchised league system, which removed the previously extant risk of sponsored teams getting relegated — like LCK's bbq Olivers did in 2018.

Europe's LEC and China's LPL have yet to introduce such partnerships, but in North America's LCS, Dignitas recently signed a four-year deal with digital bank QNTMPAY and TSM landed a milestone 10-year, $210 million deal with cryptocurrency exchange FTX — although FTX will not appear on official Riot Games broadcasts, due to activation restriction regulations on certain industry categories, including cryptocurrency exchanges.

Franchised minor-region leagues are also a part of the trend; Netshoes Miners, Red Canids Kalunga (Brazil's CBLoL), and fastPay Wildcats (Turkey's TCL) all have ongoing naming rights arrangements.

Korea, where both professional sports and esports organizations have for decades been run primarily as corporate marketing, is naturally in the thick of this movement. LCK is currently the only major-region league with three sponsored team names: DWG KIA, Liiv Sandbox and Fredit Brion.

In hopes of learning more about how such deals were reached and are panning out domestically, the Korea JoongAng Daily has been meeting with the parties involved. First to be featured in our series is Liiv Sandbox.

Years of waiting

Liiv Sandbox is owned and managed by Sandbox Gaming, the esports subsidiary of Sandbox Network, one of Korea's largest multi-channel networks that accounts for roughly 10 to 15 percent of all domestic YouTube traffic.

Sandbox Gaming had been running operations in League of Legends well prior to franchising; they initially entered the scene in December 2018 through acquiring the newly-promoted Team BattleComics and competed in LCK for two years simply as Sandbox Gaming. The naming rights deal with Liiv only came in December 2020, after the organization's franchise application was approved.

Liiv is a catch-all brand that was launched in 2016 by KB Kookmin Bank, one of Korea's leading banks, for its mobile-based platforms and services. Those with an avid interest in K-pop may recognize KB and Liiv from their commercials featuring BTS.

Many LCK fans might believe KB Kookmin Bank first entered esports by entering its ongoing three-year naming sponsorship with Sandbox Gaming, but the bank has been keeping an eye on the space for far longer.

KB's first foray into esports dates back to 2006, when the bank hosted a rather ill-conceived amateur KartRider tournament for "employees over the age of 20", in which participants were required to bring "legal proof of employment" to the qualifier venue.

While the prize pool was not too shabby for the time — first place received 5 million won ($5,400 at the time) — it was unclear why anyone would want to watch such an event, and as expected, few did. KB quickly left the space afterwards.

A quiet re-entry was made 13 years later in 2019, when KB chose to sponsor the second season of AfreecaTV's Heroes of the Storm League: Revival. It was a relatively small tournament, enjoyed by an audience of just a few thousands, but this time, public response was firmly on the bank's side.

The Heroes community's uniformly positive response helped speed up internal discussions at the bank.

In 2019, KB Kookmin Bank re-entered esports by sponsoring the second season of AfreecaTV's Heroes of the Storm League: Revival. [KB KOOKMIN BANK]

"Our talks with various parties [in esports] actually began in 2017," said Kim Tae-hyun, KB's head of brand strategy, speaking to the Korea JoongAng Daily at a venue near the bank's Yeouido, western Seoul, headquarters. On a personal level, Kim was well-acquainted with esports even before then, having watched StarCraft: Brood War during the days of Lim "BoxeR" Yo-hwan and Lee "NaDa" Yun-yeol.

KB made no immediate public moves, but did keep close tabs on the scene while conducting internal research on whether or not to run campaigns in esports. Kim spoke fondly of watching Rift Rivals 2018 live at Jangchung Arena — "I was so embarrassed when we were led to the VIP area because I'd gone in shorts and slippers," he recalled — and could recount in detail what transpired in LCK over the past few years.

Deliberations might have gone on for longer, but the launch (mid-2017) and meteoric growth (2018-19) of KakaoBank, Kakao's massively successful mobile-only bank, jolted all legacy institutions — including KB — into hurriedly developing better mobile platforms and courting tech-savvy consumers.

One easy way to do that was associating their brand with esports, a cultural space full of young people and cutting-edge technology.

Indeed, KB is hardly the only Korean bank to initiate or double-down on esports marketing in the past few years: Hana, Woori, Shinhan, and NongHyup have also made a variety of moves since 2018. However, all the other banks have mostly stuck to sponsoring leagues and tournaments, not teams.

KB's decision to align Liiv with a specific organization, and not an entire competition, was a rather unusual one — although in the global picture, it is part of a wider trend, as QNTMPAY, Papara, and fastPay all fall under fintech.

Kim explained that in sports marketing, event sponsorships work best when the primary objective is to establish prestige for the brand or to provide support for a scene in financial need. Neither really applied to KB's case, however, as Liiv never wanted to portray itself as prestigious — the brand's entire raison d'etre is looking casual and approachable — and Riot Games Korea is hardly starving for funds.

It was eventually decided that bonding tightly with a smaller group of diehard fans, compared to being better recognized by the general audience, would ultimately be more valuable for Liiv. Through the Liiv Sandbox project, Kim said, the bank is also hoping to gain firsthand insight into how to "genuinely connect" with the younger generation — a lesson, if learned, that could prove invaluable in other future ventures.

Perhaps for that last reason, KB has been making it a point to stay in tune with the day-to-day affairs of the organization, which is unusual for a naming sponsor with no direct stake in team operations.

Park Woong-kwon, a younger manager in KB's brand strategy department who handles much of the actual fieldwork involving LSB, was told by Kim when first appointed to the project: "Stop coming [to Yeouido] and just stay there."

Park clarified that he doesn't actually hang out at Sandbox's quarters on a daily basis, but does keep in close touch with the team to provide any support necessary.

Sandbox Gaming CSO Chung In-mo joined the company this February after working for years in the domestic tech startup space. [SCREEN CAPTURE]

Slim and smart

How happy is KB with the sponsorship so far?

"Well, they do hope we play better come summer split," said Sandbox Gaming CSO Chung In-mo, speaking to the Korea JoongAng Daily in Liiv Sandbox's newly renovated training facilities in Guro, western Seoul. "But data shows we are clearly helping raise recognition of the Liiv brand already."

According to keyword analytics, mentions of Liiv have increased by two to five times since the naming sponsorship began. Considering how competitively underwhelming LSB was in spring — the team was dead last at the midway point of the split, and just barely clawed up to eighth place by a one-game margin near the end — interest in the brand may grow further if they post more promising results.

Sandbox, too, had few complaints about the arrangement.

"Interactions with KB are never stuffy," said Chung. "They're very approachable and have provided us with a lot of encouragement and support, which we're grateful for."

LCK is made up of teams with vastly differing budgets and business models. Some franchises owned by domestic corporations, like kt Rolster and Hanwha Life Esports, operate akin to a "traditional" Korean sports team, capable of writing off running costs as marketing expenses for the parent company. Then there are venture capital-funded organizations, such as T1 and Gen.G, who hope to reach self-sustainability soon but for now are determined to spare no expenses in securing an early lead in the market.

Compared to such franchises, Liiv Sandbox has a much tighter budget. In a recent interview, general manager Becker Jung categorized his team as a "small-market club" relative to the field, admitting that circumstances such as their lack of a gaming house — LSB's Guro facilities are located within an office hub, across the hall from an apartment hunting services provider — was reflective of their need to stay lean.

Chung agreed with Jung.

"There are teams who can afford to invest big first and wait for the results, and teams who need to run tests on a smaller scale before expanding," he said. "[We] fall into the latter."

With neither a massive fan base nor an absurdly affluent parent corporation, Sandbox needs to run more casually and efficiently than organizations that are happy to pay for prestige.

This self-identity just happened to perfectly fit with what KB wanted for Liiv.

"We're not trying to position ourselves as a premium, luxury brand, like T1, whose players have already been collaborating with [mainstream celebrities]," Chung said. "We're going for friendly, but still cool. Like a really cool friend you enjoy hanging out with."

As LSB is unlikely to draw in fans by signing superstar names or dominating LCK, Sandbox Network's expertise as an MCN in navigating newer media platforms, such as live streaming and YouTube, will be essential to the team's brand-building operations.

"Sandbox is a company at the apex of [new media]," Chung said. "If we fail at putting out better content than other teams, that would essentially signify that we don't have any comparative advantages. In regards to content, we don't want to lose to anyone."

While LSB have yet to establish themselves as LCK's premier content creator, the team has been publishing noteworthy videos as of late. One of their more recent features, "What do parents of professional gamers think of LCK matches?", which filmed Lee "Effort" Sang-ho and Lee "Prince" Chae-hwan's parents watching their kids' matches, was lauded by fans for bringing a much-needed, human-interest perspective to the content surrounding the league.

The occasional heartwarming tear-jerker might not be enough to turn Liiv Sandbox into the "really cool friend" everyone wants to hang out with — but the piece did prove that the organization understands how to "genuinely connect" with esports fans.

Other franchises, who have neither the staff nor the budget to produce Netflix-quality, documentary-style series like T1's "The Locker Room" and Gen.G's "ALL IN", will also have taken note.

″What do parents of professional gamers think of LCK matches?″, a video in which Lee ″Effort″ Sang-ho and Lee ″Prince″ Chae-hwan's parents were filmed watching their kids' matches, was uploaded by Liiv Sandbox this April. [SCREEN CAPTURE]

Running on a clock

Both KB and Sandbox Gaming said that while they were certainly interested in reaching foreign audiences, attaining domestic popularity was of a higher priority.

Kim explained that although LCK's global reach — particularly toward Southeast Asia, where KB has been expanding its business under the Liiv brand with apps such as Liiv KB Cambodia — was a factor for the sponsorship, domestic marketing definitely comes first, as over 80 percent of the bank's business still takes place in Korea.

Chung was of the view that while the limited size of Korea's local market makes it almost necessary for its franchises to go global, organizations still "first need to prove locally that they can be loved" before diverting some of their attention elsewhere.

Such local-first viewpoints feel prudent. It should also be noted, however, that reaching foreign markets may become increasingly difficult as time passes.

Esports is becoming more and more popular around the world — no longer do foreign fans need to tune into broadcasts of Korean leagues to watch quality games. Korean players may still rank among the best in the world in a number of titles, but Shanghai and Los Angeles are where most eyes are nowadays.

Korea's once-prestigious status in esports as a cultural vanguard has been rapidly fading for some time — since at least 2017, in fact. Many newer and younger fans never have thought of Seoul as "the global capital of esports," as it was once universally known.

LCK franchises might do well to stabilize local operations as quickly as possible and frantically sprint toward the ever-receding foreign market. The payoff will most likely be greater than the cost of hiring just a few more employees.

BY JEON YOUNG-JAE [jeon.youngjae@joongang.co.kr]