In this segment, we discuss the first esports-themes mall opening in China.
The Business Of Esports brings you news, debates, and all the information you need to know about the gaming sector, the world’s fastest-growing market. With Paul “The Profit” Dawalibi leading the charge, and a variety of special guests, BoE TV is the only place to find insider information on the esports industry!
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Paul Dawalibi 1:00:12
Let’s, let’s move on, guys, let’s talk about let’s talk about something a bit lighter here. And this is a story out of China. and and the the headline here is countries first eSports. mall, targets young consumers. And so there are the stories about this eSports theme shopping complex that just opened. It’s targeted people between the ages of 12 and 30. There’s a professional eSports arena, movies, virtual VR games, there’s shops, obviously. But the idea here is this, this city is trying to make eSports one of its key industries. And they’re trying to develop this ecosystem around this mall. I laughed a little bit when I saw the second photo, Who here thinks this looks awfully like the vessel? What’s the vessel? It’s the new structure they built in front of Hudson Yards in New York City. And so it’s like, it looks directly knocked off almost wild. I’m curious what you guys say it’s kind of a silly story, kind of a fun story. But I like to think
William Collis 1:02:30
that electronic Sports Park, I also liked that they felt the need to.
Paul Dawalibi 1:02:35
But can I ask Let me ask a specific question here. malls in the US are struggling. Right have been for a while now. That kind of retail that segment of the retail market has struggled. Why don’t we see more malls sort of trying to build out complexes like this?
Jeff Cohen 1:02:53
I think we are and I think we will I don’t know if it seems like here they’re trying to make the entire point of the mall to be an Esports destination. I’m not sure I’m super bullish on that concept. But having it be an anchor tenant, same way. Historically, you Oh, every mall had a target a Saks Fifth Avenue and a Bloomingdale’s and a Macy’s and a movie theater, like having one of those anchor tenants be an Esports facility. I think that makes sense. Creating an entire mall for eSports. I’m not sure that makes sense. But why?
Paul Dawalibi 1:03:27
Why Jeff, I just want to press on that. Why don’t
Jeff Cohen 1:03:30
why would it have to be an entire mall?
Paul Dawalibi 1:03:32
It’s not just it’s themed. Right? And it’s funny because one of the first tech companies I ran and invested in and like one of the core tenants of that company was that people who all like one thing, right? So if like, you’re a huge NASCAR fan, right? That there’s very high probability you also like to other things, right? That you have common interest in to other areas, you probably love steak houses, you probably love, you know, fishing or whatever. Right? And so you can there are common interests that I feel like fit well with a themed mall. Right? So you have
Jeff Cohen 1:04:13
completely different things.
Paul Dawalibi 1:04:15
But no, but that’s kind of, I think the beauty of this concept that if you assume that the audience going here loves eSports, right? And that’s the draw. There’s a lot of other stores you can put in and be reasonably certain that people will also be interested in shopping in those places. Right, you there’s a comic book store, you have a GameStop you have a whatever right. You know,
Jeff Cohen 1:04:44
you’re, you’re framing it that way, then I agree. I mean that I wouldn’t describe that as an Esports mall. That’s like eSports is one of the anchor tenants and then it also has a comic book store like I don’t, I mean, like
Paul Dawalibi 1:04:55
you wouldn’t put a an American Eagle like you just don’t put an American Eagle because that just isn’t One of the, you know, the common tangents or whatever,
William Collis 1:05:03
but like I always go back to my like, there’s no football mall. Right? You know what I mean? Like there’s no baseball mall, right? Like, I’m not saying it’s actually it’s interesting. Like, there’s a lot to like here, right. But like I always, one thing I always like to do is say like, does it exist in a comparable industry? But I think your point is an interesting one. And I think our industry is a little different, it’s a lot deeper, it does fan out more successfully to many different places. My other question was almost a yougov. Question, which is like, is the Chinese market just so fundamentally different? Because we see so many of these mega developments coming out of China? Right? where it’s like, it’s a big deal to get a stadium in Toronto, right? Whereas this is like, a level beyond that, right? Like, I’m really curious to see. And this might be the things to look forward like the podcast or like another live stream. I’m really curious to ask YouGov about like, what is the like, what’s changed in the in the demographics in China for eSports? recently? because something is making these more multifaceted projects make sense over there? Where is, and it’s unusual for us to see so many of these in China versus in the States?
Paul Dawalibi 1:06:14
Do you think it’s not just a question of cost of labor? Like, it’s just easier to build? And try, you know,
William Collis 1:06:23
balanced out by spending power of consumer though, right, like True. True. I think it has to do with either just the the effective spend per person is, is rising very quickly, like it’s writing much higher, that’d be my guess, then like in China versus in the United States, that’d be one guests. The other guest I would have is just the penetration rate is just gotten so much higher. But it’s just weird, because again, like I usually these marquee developments, you know, like you expect them to be relatively shared globally, right? Like, it’s unusual to see like, I’m not saying like, everyone should be nice, it’s like you should see them popping up in lots of different comparably demographic, demographically comparable countries. To see them all in China says something interesting has happened in China recently.
Jimmy Baratta 1:07:10
I want to I want to add to this, I think we’re harping a lot on the word mall, right? Because we look at things that are not directly comparable, but things like the fashion district, the jewelry dish district, just these concentrated areas of similar businesses, right, that tailor to that individual that’s going there for that one theme, that one purpose or that one interest, and then obviously here, building out the infrastructure to support it. So I you know, I do think that it’s just a natural next step, if you have the funding or the financing. And then Part two is, especially with China, you really see them a B testing their their society as a whole, right? They have these zones, where they’re like testing capitalism, right. And it’s super successful. I love how they approach that because everyone’s all this is dispensable. You know, like, we’re just gonna try what works here and, and test it and see if we could replicate the success. And so why not do that? And eSports to I don’t know,
Paul Dawalibi 1:08:05
wait as the most important question, will there be game stops in these malls? Wait, they have plenty of cash now to open them in these malls if they really wanted to? So potentially, Angela says, football Ma. It’s not the worst idea, right? There’s a reason why malls have failed is because it’s not that great of an experience. If you make it more of a themed experience.
William Collis 1:08:30
And you could kind of argue there are football malls, it’s what stadiums and what crops up around the stadiums, all the development, you do have that it just has to look a little different because the centerpiece needs to be a massive stadium. So it spread differently. I don’t know maybe I’m wrong, actually. Maybe you do see,
Jeff Cohen 1:08:47
what we’re talking about isn’t some crazy new concept. I mean, experiential retail has been like the the massive trend in retail for like, a decade. So I don’t think this what we’re saying is like, crazy revolutionary. It’s like kind of where things are heading. It’s just, you know, slow and steady gets there.
Paul Dawalibi 1:09:04
Chris says there will be as many gaming PCs in China as the population of the US in five years. Well, there you go. I mean, that’s, that’s, that’s why it makes sense. I’m
Jeff Cohen 1:09:12
surprised that’s not already the case.
Paul Dawalibi 1:09:16
I mean, probably again, as much as as with most as with most of Asia, like it’s a lot of mobile first also, just not not PC penetration is higher cost, right. Um, you just don’t see as much of it. I mean, it’s a lot but meaning. I believe that’s
Jeff Cohen 1:09:35
just because the numbers of people in China are just insane.
Paul Dawalibi 1:09:41
We do do that and eSports it just sounded funny when William said it, yeah. But football, the football mall.
Jeff Cohen 1:09:48
What you’re describing is the Hall of Fame village in Canton, Ohio. Cooperstown for baseball.
William Collis 1:09:55
But where’s the lacrosse small jab
Jeff Cohen 1:09:59
famous Baltimore, Maryland.
Paul Dawalibi 1:10:01
This is this is it in Baltimore? It is. Are you are you in the lacrosse Hall of Fame to?
Jeff Cohen 1:10:06
Not yet I’ve been snubbed so far. Okay. Yeah,
William Collis 1:10:10
they have a little exhibit that I heard they were building one, but I’m sure.
Jeff Cohen 1:10:14
Yeah, waiting for me to I haven’t officially retired yet. So I was I knew that I can still count I holding out hope I’m gonna Yeah,
William Collis 1:10:22
it’s always you could always go back and pick up. What do you call it the stick? You can always pick up the stick? Yeah.
Paul Dawalibi 1:10:30
Angela says I like eSports as a draw center. Yeah, I need to like when I saw this, I just think it’s so massively just under appreciated in the US like, well, I don’t know why no one’s doing this in a much smarter way here. There’s so much free, not free, but meaning available. mall space, that is that is not doing well, that the malls are desperate. Like, you would think like a group like Simon’s that have invested in eSports. And things like groups like that, that own malls, would at least test something right, we would try and build some kind of experience around gaming and eSports that brings in, you know, just merchants who sell in and around the industry. I would love to see it. I think it would do very, very well. I think it would. Chris says we got lacrosse team in Vegas now. Will they have more paying fans than eSports? I don’t know. Good question.
William Collis 1:11:29
called lax guys. Let’s start calling it by thrill. You
Jeff Cohen 1:11:31
got some serious money behind them. I know that.
Paul Dawalibi 1:11:34
And wait says there’s an Esports arena that opened up in Austin that has me wondering if small eSports venues could be the next corporate event team experience type thing like the new escape room type thing? Wait, I actually totally agree with that. I think most definitely. And I also think that’s going to empower like a lot of people who want to be gaming entrepreneurs, like there’s, and I think I’ve said this on the podcast before, I think there’s a massive opportunity to go after that much smaller space, maybe only like 10 stations. And you’re a local entrepreneur, you know, you do birthday parties and bar mitzvahs and soccer, you know, after soccer outings and, you know, small corporate events like you engage the local community in a way that larger centers, land centers may struggle with more, but I do think that’s coming. It’s an interesting, it’s an interesting thought, guys, before we move on just a quick, we have a UDF segment this week, which I’m totally excited about.
William Collis 1:12:36
Kind of an acronym for it.