New media, new possibilities? How esports strategies guide an ambidextrous understanding of tradition and innovation in the German Bundesliga

ABSTRACT

Sport clubs are endowed with beliefs and practices that constitute their tradition. Conversely, there is a certain pressure to embrace innovation to win the race for tomorrow’s fans. Managing two inherently conflicting systems such as tradition and innovation can be seen as an ambidexterity challenge. Despite this, new media and esports change the access, perception, and consumption of traditional sport. We conduct a multiple case study to investigate how nine (out of 18) clubs from the German Bundesliga approach esports. The dynamic configuration model presented in this study showcases that hybrid clubs effectively overcome innovation inertia within their traditional environment. This research enriches our comprehension of the tradition-innovation paradox, emphasising that tradition and innovation are orthogonally aligned rather than opposed.

KEYWORDS:

• Ambidexterity
• innovation
• tradition
• football
• soccer
• sport entrepreneurship

Introduction

Driven by digitalisation, esports has become an important new media tool that entails fundamental changes in the management of sport organisations (Funk et al., 2018). Esports, embodied primarily by a younger viewership than traditional sports (Huettermann et al., 2023; Watanabe et al., 2021), represents a radical shift in consumption due to its geographic independence (Watanabe et al., 2021), and is oftentimes not considered a “real” sport due to low physical activity (Cunningham et al., 2018). The characteristics of the emerging newcomer in the sport scene are partly antithetical to those of traditional sport, and the management of esports, therefore, poses unprecedented challenges to mature sport organisations (Pizzo, Kunkel, et al., 2022).

A growing number of professional sport leagues, including the NBA (Lopez et al., 2021), Major League Soccer (Markovits & Green, 2016), and the German Bundesliga (Hammerschmidt et al., 2021), have embraced the lucrative growth opportunities offered by esports and are allocating increased resources to diversify their business models with esports. While the literature on esports has studied the commercial aspect of esports consumers in detail (Pizzo, Su, et al., 2022), contributions to the organisational impact of esports are still scarce. A few first studies addressed this gap and explored how professional sport organisations are diversifying their previous, pure sport product portfolio into esports primarily by buying already existing esports teams (Pizzo et al., 2021; Pizzo, Kunkel, et al., 2022). However, this type of strategy to enter esports is rather seldom (T. V. L. Scholz & Uebach, 2021), and literature would benefit from diverse and exploratory findings from cases that are not a priori narrowed to a particular esports strategy.

The dynamics of the esports innovation process are exciting and rather unusual in sport, as traditional sport organisations tend to be slow, reluctant, and inefficient in innovating their business model (Funk et al., 2018; Hammerschmidt et al., 2021). The culture of observing and reacting has its origins in the traditional and nostalgic environment of sport clubs, which is in principle opposed to proactive change and, as a result, hinders innovative dynamics (Thiel & Mayer, 2009; Wolfe et al., 2006). Identification with the past leads to a difficult tension between tradition and innovation in sport, creating an either-or relationship, and causing sport clubs to think twice about a planned innovative initiative (Hammerschmidt et al., 2021). In the tradition-rich context of sport, successful innovation processes require innovative champions (Wolfe et al., 2006) and permanent personnel support (Hoeber & Hoeber, 2012).

Sport organisations are under a certain pressure to innovate to win future fans’ favour (Hammerschmidt et al., 2021; Pizzo et al., 2021; Radaelli et al., 2017). Nevertheless, the search for disruptive strategies that lead to sustainable competitive advantages for professional sport organisations has so far produced few promising cases. The diversification of traditional sport organisations into esports is not only widely accepted but also actively demanded by fans (Lefebvre et al., 2020). The implication that esports seems to be a rare case where a new, explorative, and disruptive strategy is succeeding in the seemingly anti-innovative environment of traditional sport organisations deserves to be further explored. Hence the following research question is postulated: How do professional football clubs manage their esports activities in the tension between tradition and innovation?

In this study, we apply the theory of ambidexterity as a theoretical anchor to examine how sport organisations can succeed in the tension described above. Ambidexterity is the concept of simultaneously exploiting and exploring (Raisch et al., 2009) and, in a broader sense, the ability to manage two conflicting systems equally well (Markides, 2013). Ambidexterity research can be used in different scenarios and disciplines as a supportive tool when looking at two opposing systems from an additional perspective (Guerrero, 2021). T. M. Scholz and Stein (2017) showed that esports is a potent strategy for traditional media companies to invest in the exploration of new business areas and thus foster organisational ambidexterity. Esports offers promising conditions for an effective strategy to foster innovation and deserves further investigation. Our study uses insights from an analysis of esports activities of traditional sport organisations as a guide to gain insights into how sport organisations interact in an ambidextrous understanding of tradition and innovation.

To approach this research question, we use theory linking through inductive theory building (Eisenhardt, 2021). In addition, this study follows the recommendation for more interdisciplinary (Lefebvre et al., 2020) and pragmatic (Pizzo, Su, et al., 2022) scholarship in the esports sector and therefore conducts a multiple-case study with nine (out of 18) clubs of the German Bundesliga.

This article contributes to research on the management of esports by examining how football clubs from the German Bundesliga manage esports. By conducting a multiple case study, the study investigates how these clubs leverage managerial strategies to promote esports integration within their traditional environment. It provides insights into different perspectives, structures and methodologies adopted by football clubs to embrace innovation and adapt to the changing landscape of sport consumption.

Furthermore, this article contributes to innovation research by examining the tradition-innovation paradox in the context of sport. By studying how football clubs manage this seemingly inherent conflict between tradition and innovation, the article offers a nuanced understanding of the dynamics at play. It explores how clubs differently perceive and embrace innovation inertia in their traditional environment. The findings of this research contribute to the development of a dynamic configuration model of tradition and innovation in sport, which acknowledges the complexities and interplay between these two elements. By doing so, it provides a more comprehensive framework for understanding how tradition and innovation can coexist and interact within a sporting context.

Theoretical background

The tradition-innovation paradox in sport

The management of sport organisations is challenged nowadays by faster-moving markets (Escamilla-Fajardo, Núñez-Pomar, Ratten, et al., 2020), the heterogeneity of the customers (Jones et al., 2017), hyper-competitive environment (Radaelli et al., 2017), and trends in introducing new sports (Jones et al., 2017). Therefore, sport organisations are advised to capitalise on innovation as a means to facilitate growth (Núñez-Pomar et al., 2016; Pellegrini et al., 2020), enhance organisational performance, and stimulate social impact (Escamilla-Fajardo, Núñez-Pomar, & Gómez-Tafalla, 2020; Hammerschmidt et al., 2020).

Despite the obvious and conscious need to innovate, sport organisations tend to be reluctant and non-proactive when it comes to implementing new business strategies (Hammerschmidt et al., 2021). This deliberate behaviour of sport organisations, which is reactive and pragmatic rather than strategic and active, stems from a culture of informality and tradition (Hoeber & Hoeber, 2012), which plays a major role in inhibiting innovative behaviour of sport organisations (Thiel & Mayer, 2009; Wolfe et al., 2006).

Tradition is primarily understood as “consciously transmitted beliefs and practices expressing identification with a shared past” (Dacin et al., 2019, p. 32). This implies a certain invariance of tradition and stability over time (Erdogan et al., 2019) that helps the organisation to survive and endure in the long term (Marquis & Tilcsik, 2013). The seemingly paradoxical challenge between tradition and innovation particularly affects traditional organisations in the areas of family firms (Erdogan et al., 2019), hospitality (Presenza et al., 2019), food industry (Dettori et al., 2020), and media research (Keturakis, 2021). A similar situation can be seen in sport, where long-established sport clubs, endowed with a bundle of beliefs, rituals, and practices that constitute their tradition, feel pressure to pursue innovate for their continued existence (Hoeber & Hoeber, 2012) or to enhance business performance in times of recession (Hammerschmidt et al., 2021). Such forces pulling towards the past and the future, antithetically calling for continuity and change, seem paradoxical and create a challenging tension (Erdogan et al., 2019). Consequently, sport organisations need strategies that manage to allow innovation in their complex environment to create an equilibrium between tradition and innovation (Næss & Tickell, 2019).

Organizational ambidexterity as a structural model

Originally meaning the equally developed dexterity of both hands (Volery et al., 2013), the concept of ambidexterity fundamentally describes the ability to manage two conflicting systems equally well (Markides, 2013). The multifaceted ambidexterity theory is an interdisciplinary framework that allows research questions from different fields to be considered from different perspectives (Guerrero, 2021). In principle, the insights and concepts from ambidexterity research are suitable as a theoretical anchor to better understand the challenges of managing two incompatible business models (Markides, 2013), such as between efficiency and flexibility in redistributed manufacturing literature (Roscoe & Blome, 2019), alignment and adaptability in the creative industry (Wu & Wu, 2016), or agile and traditional methods in systems development organisations (Vinekar et al., 2006). Moreover, ambidexterity theory is a useful perspective for studying innovative behaviour in media research (T. M. Scholz & Stein, 2017). Thus, this article approaches ambidexterity theory as an appropriate lens to better understand the relationship between tradition and innovation.

Esports as an innovative guide

Despite the tension between tradition and innovation, esports as a business model innovation has gained traction in professional sport (Lefebvre et al., 2020; Pizzo, Kunkel, et al., 2022). While the debate continues that esports is not a real sport (Pizzo, Su, et al., 2022), recent studies indicate that esports is rapidly being adopted by the general population and has a remarkably high potential for revenue generation (Lefebvre et al., 2020; Pizzo, Kunkel, et al., 2022; T. V. L. Scholz & Uebach, 2021). Esports is a successful innovation strategy for traditional sport organisations (Pizzo, Kunkel, et al., 2022) and the antecedents and conditions that have facilitated this trajectory deserve further investigation.

The opportunity to establish esports as a viable business model emerged as a significant driver for sport organisations seeking diversification into the esports industry. Consequently, the literature has directed its attention towards exploring consumer behaviour in the context of esports (Pizzo, Su, et al., 2022). This attention stems from the recognition of the diverse and positive effects that esports has on sport organisations. Lefebvre et al. (2020) conducted an analysis indicating that football clubs are motivated to expand their presence into esports due to external pressures, including consumer demand and the strategic adoption of other football clubs (strategic isomorphism). However, esports is not an industry that guarantees success as sport organisations face challenges in formulating suitable strategies to effectively capitalise on the popularity of esports while maintaining the integrity of their brand image and avoiding potential deviations from their brand essence (T. M. Scholz, 2019).

In the media industry, esports companies are especially characterised by their unconventional ideas and novel approaches to solving media-related problems, which make them attractive investment opportunities for media corporations (T. M. Scholz & Stein, 2017). Sport organisations are likewise increasingly providing resources to further enable and structurally anchor the growth of esports (Lopez et al., 2021; Witkowski, 2018). In line with that, Pizzo et al. (2021) suggest that esports should be considered not only as a novel form of media but also as a competitive tool for sport organisations in their quest to rival traditional media conglomerates.

Methodology

Research design

Using a multiple case study approach fits best for the explorative nature of the research question (Yin, 2009) and is well suited for complex real-life contexts where knowledge is scarce (Eisenhardt & Graebner, 2007). Case studies are popular in both esports (Karhulahti, 2017; Lefebvre et al., 2020; Pizzo et al., 2021; Pizzo, Kunkel, et al., 2022) and professional football research (Hammerschmidt et al., 2021; Trequattrini et al., 2016). The present study employs a multiple-case approach to facilitate theory development. By employing a constant comparison method, we systematically compare the developed theories with the collected data, aiming to identify logical constructs that are replicated across cases. Through this iterative process of theory-data comparison, we seek to strengthen the theoretical framework and enhance our understanding of the phenomenon under investigation. By theoretically sampling the different cases and their variances, well-identified frameworks and relationships can be developed (Eisenhardt, 2021) that will help this study link the results of esports activities with the theoretical anchor of ambidexterity. Triangulation of data is included to provide the increased substance of findings through multiple data capturing (Eisenhardt & Graebner, 2007).

Sample and data collection

The sampling method is based on purposive sampling (Easterby-Smith et al., 2012), and of the 18 clubs in the German Bundesliga, nine clubs agreed to participate in the research. The inclusion of professional football clubs from the German Bundesliga is particularly suitable for this study due to their strong association with a rich tradition (Schreyer & Däuper, 2018). However, the clubs included in our sample differ in terms of esports strategy, number of fans, and age of the club, providing the variance necessary for a multiple case study to be informative (see Table 1). The inclusion criterion for participating in the study was to be part of the German Bundesliga.

Table 1. Overview of participating football clubs from the German Bundesliga.

Club	Founding year	Ranking VB season 2021/22	Gross profit season 2021/22	Nr. of employees
FC Bayern München	1900	-	664 774 000 €	>250
Borussia Dortmund	1909	-	473 687 000 €	>250
RB Leipzig	2009	1.^a	325 057 000 €	>250
Bayer 04 Leverkusen	1904	11.^b	271 321 000 €	>250
VfL Wolfsburg	1945	12.^b	210 923 000 €	>250
1. FC Köln	1948	5.^b	114 748 000 €	>250
Hertha BSC Berlin	1892	7.^a	111 935 000 €	50–250
VfB Stuttgart	1893	-	92 287 000 €	50–250
VfL Bochum	1938	9.^a	32 837 000 €	50–250

VB = Virtual Bundesliga; a = South-East division; b = North-West division.

Professional football clubs have been involved in esports for several years and both already maintain a close and well-established relationship (Lefebvre et al., 2020). However, esports is still highly volatile and unstable (T. M. Scholz, 2019). Lefebvre et al. (2020) have shown that esports in professional football is still too unsystematic to identify precise patterns in a large and international sample. Our exploratory approach focuses on football clubs playing in the same league to reduce the complexity of contextual influences on outcomes, such as politics, culture, or demographics.

For the sample, we included key informants who are involved in important decision-making processes in the esports strategy of their organisation. The selection of key informants for community-engaged research such as football clubs is valuable as they provide significant knowledge and a true insider perspective about their organisation, their unit within the organisation, or relationships within and outside their organisation (McKenna & Main, 2013; Rowley, 2012). In the selection of participants, we chose informants from a homogenous group (football) that differed in detail (clubs) to investigate similarities and differences along with the cases, which in turn improves the robustness of the results (Guest et al., 2016).

Data collection for this study involved conducting semi-structured interviews with each of the nine selected professional football clubs from the German Bundesliga. The choice of using semi-structured interviews was deliberate, as this method offers flexibility in terms of accommodating diverse questions and allows for adaptations in line with the interviewer’s guidance. Moreover, the semi-structured format is particularly appropriate for an exploratory approach, as it facilitates in-depth exploration of the topic at hand while maintaining a level of focus on the specific areas identified by the interviewer (Klenke, 2008). The interviews, which lasted between 30 and 50 minutes, were based on an interview guide consisting of questions about current esports activities, the tradition-innovation paradox, the impact of esports on the club, and the expected long-term impact. One of the participating clubs, VfB Stuttgart, was involved in esports from 2018 to 2020 but temporarily withdrew during the COVID-19 pandemic due to financial considerations. However, it is important to note that during the interviews, the club’s plans for re-entry into esports were already underway and formed a part of the evaluation. Subsequently, VfB Stuttgart re-entered the esports arena for the 2022/23 season. These circumstances provide valuable insights into the club’s experience with esports, including the challenges faced during the pandemic and the subsequent strategic decision to resume their involvement in the esports domain.

In addition, we triangulated our data with a questionnaire that provided descriptive data, including demographic data, respondent role, and firm size. The study applied the categories for firm size from the European Union Commission (2003) for small and medium-sized enterprises (SMEs), which are highly comparable to professional football clubs (Moore et al., 2012). In addition, the triangulation included publicly offered data (Yin, 2009) from the Deutsche Fußball Liga (DFL), the Virtual Bundesliga website, official press releases, and the clubs’ website. The triangulation was stopped as soon as we had collected the required amount of data to answer the research question, while at the same time not revealing too much information that could lead to the cases being identified and their anonymity violated.

Data analysis

To answer our research question, we applied inductive data analysis in multiple cases (Eisenhardt & Graebner, 2007). The interviews conducted were transcribed, individually read, and openly coded by the authors (Corbin & Strauss, 2014). More specifically, the authors first read the transcribed interviews independently and initial notes were made on interesting statements. Subsequently, the entire dataset was systematically coded, following a rigorous approach. The items were paid equal attention to and analysed individually. Next, superordinate thematic groups were generated from the items. Throughout the analysis process, the items and groups underwent continuous refinement, with the authors engaging in a back-and-forth exploration between the transcribed data and the initial topics of analysis. This iterative approach facilitated the identification and comparison of a diverse range of topics, enabling a comprehensive examination of the dataset (Ayres et al., 2003). This process guarantees that the answers of a single interviewee cannot lead to a superordinate topic. This inductive process was iteratively repeated multiple times, guided by the principles of internal homogeneity and external heterogeneity, to ensure a meaningful and comprehensive analysis of the data (Braun & Clarke, 2006). Based on this open coding process, we analysed connections of replicating concepts and logic in the data. We identified patterns in the data to build theory in terms of our scientific intent (i.e. fans’ reactions to initiating esports activities) (Eisenhardt, 2021). This method has the purpose of analysing important aspects of the informants’ experience, thereby discovering configurations of the themes and hence building theory (Eisenhardt & Graebner, 2007).

Results

The explorative analysis shows that the clubs are in different stages of development and find individual solutions to engage in esports. In the following section, the main subjects that emerged from our analysis are explained.

Esports integration

Esports is primarily rooted in marketing, business development, or digital departments, with a focus on new media, digitalisation, and technology (see Table 2). The goals of esports departments are accordingly commercially oriented, they speak of fans as “customers” (Case F) and wins are rather functional for marketing purposes (Case D, G). The esports managers of the clubs predominantly possess marketing expertise, while occasionally lacking in-depth knowledge and competence specific to the gaming industry: “I’m not really into the League of Legends scene” (Case B).

Table 2. Esports integration and dynamic configurations.

	Integration of esports	Esports genres	Understanding of esports	Aim of engagement	Integration strategies
HYBRIDS
Case E	Corporate development; shareholder of an esports organisation	Efootball	Esports as a platform	Create an emotional bond with FOT; profit	Communicate and educate; lobbying
Case C	Esports team	Efootball (men and women) and LoL	Living esports	Winning; attract and care for FOT. CSR tool	Communicate and educate; resilience; sportification
Case F	Corporate strategy	Efootball	Alternative revenue source	FOT; Adapt to digital consumption	Communicate and educate, testing; driving leaders; crisis as a trigger
Case G	Marketing and sales	Efootball	The modern part of the club brand	Winning; reach FOT; profit	Separation from the core business, early mover; incremental grow
TRADITIONALISTS
Case A	Digital strategy and innovation; ext. agency	Efootball	Experiment; case study	FOT; fan loyalty; profit	Testing: separation from core business
Case B	Digital department; ext. agency	Efootball	Entertainment; business case	FOT; attract new partners; profit	Testing; reacting to market; communicate
INNOVATORS
Case D	First business development – now marketing; two ext. agencies	Efootball (men and women)	A fundamental part of the club; marketing tool; CSR tool	Interact with FOT	First mover
Case H	Marketing department; agency	Efootball (men and women) but open for more	Bold sub-brand; an opportunity to test innovations	Winning; FOT; transport brand values; future profits	Sportification; creating own formats
NASCENT
Case I	B2B Marketing	Efootball	Marketing tool	FOT; strengthening the fan base; profit	Incremental grow

FOT = Fans of tomorrow, LoL = League of Legends.

Case G reports that esports will be integrated into parallel with teams such as the men’s, women’s, or youth teams in the future. The notable exception here is Case C, which has established an independent esports department that controls its budget, sponsors, and competitive goals. The position of the esports department can be seen as a separate and independent department and parallel to the other teams (men, women, youth, etc.).

If we need graphics or video material, then I go to the [club’s TV department] … the whole structure that [our club] has, I use that as well. (Case C)

The main goal of the clubs’ esports strategy is to reach a younger audience (all cases).

We have new, completely different target groups. The fans who follow [our club] now on Instagram, for example, are not necessarily the same ones who follow us in gaming. They are simply new fans or a further expansion of the target group. (Case H)

Most participants concentrate their esports endeavours on efootball, while intentionally refraining from venturing into non-sport gaming genres (Cases A, B, D, G, I). However, some participants display a willingness to explore new esports genres and are currently engaged in deliberate considerations for potential expansion (Case E, H). Participants report caution as they are unsure how their traditional fans will react if they move away from their core business. However, Case C has already diversified into the non-sport esports genre League of Legends to further expand its esports activities.

Sportification of esports

Coaching esports players is similar to the coaching structure of physical players, and coaches, assistant coaches, youth coaches, fitness coaches, and mental coaches pay attention to topics such as training, psychology, fitness, nutrition, and school (Case C, G). Cases C, D, and H are represented by women on their esports teams, and the influence of women in esports is perceived to be increasing. A participant reports that, including players, almost 20 people are permanently employed in their esports section.

Clubs are already aligning their esports strategy with that of the sport teams and using the competencies built up through sport in the areas of marketing, ticketing, or merchandising.

In the long term, we want to build up our value chain, similar to the one we know from football or professional football. Of course, this is not transferable on a one-to-one basis, but there are many building blocks that can be applied. (Case E)

Case C, however, must be mentioned here as a special case with a sport entrepreneurial focus on exploring and exploiting opportunities to create profits, social value, and wins (Hammerschmidt et al., 2022). Profits are, like in a traditional sport team, functional to enable further growth and more wins.

For us, esports is not only a marketing tool. We live it (Case C)

Case B also reports that it wants to make its esports area more competitive in the future. Case H points out similarities with professional sport and states: “It’s like in sport when you’re successful, it’s easier to work”. Case D notes, that esports will become a fundamental part of his club, thus contributing to his tradition.

Antecedents and successors for esports integration

By analysing the esports activities of traditional clubs, we discovered several factors that favoured successful integration.

Communication and education

The effective integration of innovative esports into traditional clubs necessitates a focus on fan communication and education. Clubs recognise the significance of this aspect and actively engage in dialogue with their traditional fanbase before introducing innovative initiatives. The key strategy is to involve the fans from the early stages of development, ensuring their active participation and support. By prioritising fan engagement, clubs can foster a sense of ownership and create a conducive environment for the successful integration of esports innovations.

Just because some business case comes to light doesn’t mean that we’ll tackle the issue, but we’re more cautious and always try to put ourselves in the fan’s shoes a bit … also to enter into direct dialog and discuss the direction. (Case B)

Whenever change takes place and something new happens, people ask about it first. This is a lot about clarification, education, and explanation. (Case E)

Esports, they welcomed it. We explained right from the start why we were doing this. Most of them applauded. (Case F)

And then you notice when you do the educational work and tell them why [this club] is doing this, that they then develop a feeling like this: ok I’m maybe still not a fan of this, but I understand it and still think it’s actually good. (Case C)

Separation

Another strategy of the clubs is to initially separate the esports activities from the main club. These are then established and developed in their divisions and through their channels. By “detaching [esports] from the classic club” (Case A), the clubs reduce the connection of the new initiatives with the traditional core of the club.

For this season, we’ve resolved to separate the two more consciously. That esports can certainly be different … the esports team also stands for the brand but for the modern, innovative part of the brand. (Case G)

Testing

Especially for clubs that operate in a very traditional environment, testing new, innovative business models is a valuable way to experience the reaction of their traditional environment. By initially testing an idea, clubs hope to gain actionable feedback and hence determine the future of the initiative.

This is almost a case study for us. Where we simply try out how … is it received by partners and, of course, how is it received by fans. (Case A)

Nevertheless, a development in the gaming sector has not passed us by and we have approached the whole thing a bit with various test cases. (Case B)

Agencies

Cases A, B, D, and E manage their esports activities through internal staff, but operational tasks, such as managing esports players, are handled by external agencies. Case C started with an agency in the first year but then transferred the competencies completely in-house.

We started with an agency to raise the whole thing … Then in the second year, we got more and more things to us and then hired an additional person. (Case H)

Case E plans to move away from the agency model and employ the players permanently in the club in the future, as the area is to grow further and thus create stronger proximity. Case F plans to build sustainable structures for their team to generate a more emotional connection. In general, the agency model seems to be a suitable strategy for a low-risk market entry, but in the long term, the clubs opt for the in-house model, since success in esports is a “marathon, not a sprint” (Case G).

Driving leaders

Leaders can also be instrumental in organisational change and hence are critical forces in driving esports integration.

I know that [the sporting director] has promoted the topic very much and that … the CEO will expand the topic (esports) even further … one of the most important drivers of the future. (Case F)

External triggers

The criteria previously discussed for the integration of esports primarily focused on internal factors within the control of the clubs themselves. However, it is important to recognise that clubs are also influenced by external factors, including crises, which facilitate the integration of esports into their organisations.

There are two possibilities. Either you do it motivated by your conviction or the pain is too great at some point, so that change has to come. COVID-19 has shown that change must come. (Case F)

In some cases, external factors, such as official licencing regulations, can exert pressure and necessitate the integration of esports.

The [Deutsche Fußball Liga] had included participation in the [Virtual Bundesliga] as a licensing criterion. This means that from the coming season onwards, it will be mandatory for all first and second-division clubs belonging to the DFL to have an e-football team. (Case H)

Impact of esports

Informants agree that esports will grow in the future and its influence accordingly. Case A reports that “growth cannot be prevented, with or without us”. Esports is primarily aimed at a young audience, but the viewership is getting older and more diverse, and the number of followers of esports is growing accordingly.

I could even really imagine in the long term … that esports will eventually have a wider reach than … many current professional sports. (Case A)

Media. The clubs benefit from the authenticity of the direct marketing of esports via streaming platforms and social media. The undistorted streaming view directly from the living room of the esports stars suggests proximity, which is well-received by the fans. In addition, the digital nature of esports offers the opportunity to connect with fans globally. The primary emphasis lies on Twitch as a streaming platform, along with Discord, TikTok, and Instagram as essential communication and social media tools.

We don’t … find and reach the fans through these very classic media… the big esports tournaments are not broadcast on TV, they are more likely to take place on Twitch or TikTok in the live stream. (Case H)

Clubs are also looking to invest more in media infrastructure. Case B reports that a studio for live streams is to be built. Case C owns an “esports room” where players can meet and streams take place.

Case A reports that the current influence of established media companies in esports is relatively limited. However, it is anticipated that esports will become increasingly significant in the long run, leading to the involvement of traditional media. This trend is observed in Asia, where classic media entities play a pivotal role in broadcasting esports mega-events.

Partners

Due to the young target group, esports is interesting for new sponsors as well as for existing ones who want to expand their portfolio.

Through esports [we have] completely different opportunities to reach out to other partners that might not be relevant to the club at all or that would be so relevant. (Case H)

The activities in esports open up new opportunities for cooperation with partners and sponsors. Like the clubs, companies can reach a different, younger target group through the channels of the esports teams. Consequently, esports provides a favourable entry point for sponsors, enabling them to establish initial connections and subsequently deepen their involvement with the club through additional engagements.

Then about the access to new interesting partners and sponsors who open up to the esports area of [our club], but also then to the football area and thus also pay into the overall strategic goals of the club. (Case E)

Sociality

As esports’ influence grows, participants report an increasing social responsibility to young people. As Case C reports, they feel a “noticeable social responsibility for young fans and players”. Out of this feeling, the clubs start actions and programmes to support the younger generation in dealing with esports.

Charity is also a big topic here. We always have an annual charity cup, and in recent years we’ve raised many thousands of euros for aid organizations in [our city]. (Case E)

Furthermore, football clubs acknowledge the potential negative impact of console gaming on children. As exemplified by Case D, proactive measures are being taken to initiate significant educational programmes aimed at training and guiding young fans of their esports teams on maintaining a healthy and responsible approach towards digital gaming.

“Why don’t you play FIFA or sit down in the console and play?” This is going in the wrong direction. That’s why … we invite classes and talk about topics such as nutrition, physical activity, but also gaming addiction, where our esports players have also made guest contributions. (Case D)

Dynamic configuration of tradition and innovation ambidexterity

The results suggest that the tradition-innovation paradox turns out to be much more complex in practice than previously assumed in the literature. Notably, one-third of the clubs (3) do not identify themselves as traditional clubs despite operating within highly emotional environments. Additionally, a nascent club emerges that does not align with either traditionalist or innovative characteristics (Case I). Pioneering clubs, recognised as innovators, leverage their unique circumstances to exhibit levels of innovation that exceed the industry average (Case D, H).

The majority of the clubs (6) identify themselves as highly traditional, with traditionalist clubs displaying significant inertia to innovation due to their adherence to traditional values and environmental influences (Case A, B). Nevertheless, the data reveals the existence of hybrid clubs that have successfully developed strategies to embrace high levels of innovation despite their traditional environments (Case C, E, F, G). The assessment of tradition and innovation levels is based on the insights obtained from the interviews conducted with the clubs.

In this context, tradition and innovation have not been seen as antagonistic either-or issues, but rather strategies have been developed that allow for both to interact and coexist. Accordingly, our interview data reveal different dynamic configurations that go beyond basic reciprocity and imply an orthogonal relationship between tradition and innovation (see Figure 1).

Figure 1. Dynamic configuration model of tradition and innovation in sports.

Nascent

Clubs in this configuration show, compared to the other participants, neither a high level of tradition nor innovation. These clubs are mostly emerging clubs that are in the nascent process of establishing themselves.

We started small here and have now installed it as a permanent area, where there are already jobs, as I just said. This (esports) is being driven forward. (Case I)

These clubs thrive in comparatively non-traditional environments, allowing them to innovate without feeling restricted by traditional values: “We can create new formats, can go to new platforms where we share the formats” (Case I). Although the opportunities and possibilities that innovations could create a competitive advantage are recognised, innovations tend to be started small and then grow incrementally. These clubs can certainly be innovative, but rather at a low level without radically changing the market.

[Esports] opens up a lot of new possibilities and opportunities. And the nice thing is, it starts small … and you don’t have to aim for the big picture. (Case I)

Innovators

These clubs operate in a hardly traditional environment and are the innovative leaders in the market. Similar to the nascent clubs, these clubs may have low levels of tradition, even though they are struggling for legitimacy: “This comes from other fans scenes, where then also is said [this club] has no tradition” (Case D). However, innovative clubs are characterised above all by their innovative character. The innovators are pioneers in the field, whether it’s entering esports or integrating women into their esports teams (see Table 2).

But this club … has traditions from the past. Nevertheless, we would like to continue to be an innovative club … we also have to somehow make sure that we continue to innovate and break new ground … We were the first Bundesliga club to decide to do [esports], without any blueprint. (Case D)

You have to keep creating new incentives … we as a club always want to polarize. We also want to cause a stir, because people also talk about us in that context. We want to go our way and do that with our formats, where we can be bolder. Courageous in this context … that’s simply an advantage we have over other clubs that are more traditional. (Case H)

These clubs do not suffer restrictions in the relationship between tradition and innovation but are well aware that other clubs are affected.

[Regarding the ability to manage the tradition-innovation tension:] For us, yes. How it is with other clubs is of course difficult. See Bayern Munich, see Dortmund, see Dresden. There are, of course, some extreme clubs that are very proud of their tradition. Which is also fine … from [our] fan scene … I’ve never experienced anything negative personally or even through our channels. (Case D)

These clubs are usually rather new and may claim “we are not a traditional club” (Case H). This is also seen as one of the main reasons why they can be so innovative.

I think that’s an advantage that we have over other clubs that are more traditional or that have been around longer. Simply because of the fans – I am also here in exchange with the other club representatives – especially at the start with some clubs it was difficult to implement the whole topic. That wasn’t the case for us at all … Simply because our fans there are just a bit more open than the classic football fans. (Case H)

Traditionalists

The operation of clubs in a deeply entrenched traditional environment imposes constraints that limit their capacity to pursue innovative approaches, as stated by Case B: “You can’t do what you want”. They highlight traditional clubs within the football sector, in particular, for their notable inertia towards innovation and exhibit a significant degree of resistance from fans.

In the economy … when you have your innovation, you put a few numbers next to it, and when someone decides that’s a good idea, off you go. That’s not how it works in football in general, and I do believe that smaller clubs or newer, more digital clubs can perhaps be faster than a traditional club with structures, with established fans … and tradition also imposes obligations somewhere. It could be that we have a speed disadvantage, I would say. Or what do you mean by disadvantage, it’s also nice to have a tradition. (Case B)

These clubs are characterised by great tension between tradition and innovation, which is especially expressed by the behaviour of their fans.

Of course, there are also very traditionalist groups that reject such things. I think we are always confronted with this issue at [our club], not only when it comes to esports, but also in general, when it comes to all issues surrounding the further development of the club. To a certain extent, perhaps also commercialization. These are all topics that always meet with a divided echo. (Case A)

In essence, these clubs do not dismiss the possibility of embodying both tradition and innovation, with one club expressing, “I do not think that is a contradiction” (Case A), while another club considers it “not paradoxical, but a challenge” (Case B). However, these clubs strive to demonstrate modest levels of innovation within the scope of their capacities, as they acknowledge the significance of innovations in generating new revenues and securing a competitive advantage in the long term. However, they report a significantly higher effort and an overriding caution to implement innovations and are aware that they cannot be innovative leaders due to their preconditions. As explained in the previous section, traditionalists primarily use the cautious strategy of testing to implement esports (see Table 2).

There are topics where we moderate, where we talk to fan representatives, where we are involved, where we can’t just say: it’s such a great idea, I’ll just do it, but where we always have to ask ourselves a bit of a question: how will it be accepted, what complications might there be. Just because some business case comes to light doesn’t mean that we’re going to state the issue, but rather we’re more cautious and always try to put ourselves in the fan’s shoes a bit. (Case B)

Hybrids

Hybrid clubs are mature clubs whose basic traits of tradition and innovation coexist. The environment of these clubs is traditional, and fans may initially react negatively to innovative initiatives. However, these clubs have developed strategies to successfully navigate the traditional environment and become innovation leaders. It is notable that the hybrid clubs in particular use communication successfully to counter potential resistance from traditional fans (Case C, E, F). In addition, the hybrid ones are the only clubs that mentioned that they educate their traditional environment to overcome or prevent the tradition-innovation tension (see Table 2).

When the news came that [we] were doing esports, there were stickers [against it]. That accompanied us at first, but what we noticed over the years was that many who … said a traditional club does not fit something so modern … have meanwhile not at all with this opinion. I’ve talked to many people from the [hardcore fan scene], who said at the beginning I didn’t understand why you do that, but now I understand. (Case C)

When we’re in the early stage and we’re actually testing MVPs and something doesn’t work, then it can become a bit more critical. But if you communicate that right from the start and say, hey, we’re testing things to improve our services, and products, to innovate and to bring something completely different to the market. I think then the fans are open to it. (Case F)

In the objectives of these clubs, “tradition and innovation are not mutually exclusive” (Club E) and they are capable to promote both values tradition and innovation, as they are aware that the union of both is indispensable for growth. It was very interesting for the authors that ambidexterity was mentioned in this context.

That includes these two sides, people like to talk about ambidexterity. On the one hand … there is the issue of tradition and history. Where do I come from, what makes me strong at the core – I must always retain that. On the other hand, … if I don’t want to disappear from the landscape, then I also have to adapt and, in the best case, I move proactively and disruptively, so perhaps I also lead the way. After all, that’s what [this club] claims to be – a driver of innovation. (Case E)

As a consequence, these clubs show high levels of innovation although being traditional clubs. Ideally, the two systems can not only coexist but even cross-fertilise.

Tradition and innovation are not a contradiction, on the contrary, they are highly enriching … The biggest opportunity in the future lies in the transformation of the Bundesliga. That you create innovative topics like a startup to displace big business and the Bundesliga is rather a small company compared to the big leagues like England or Spain … . It’s just a question of how you do it, and I think if you do it reasonably smart, it’s a huge opportunity for a traditional club, not a burden. (Case F)

A good example of mixing tradition and innovation is our [special colors] esports collection. Modern people associate [these] colors with diversity, but for us, it’s a traditional theme. Because we already played in these colors in 1997/98… it’s part of our tradition. Never before has a club in the Bundesliga earned as much merchandising revenue from esports as we have with this collection. (Case G)

Discussion

From commercialization to sportification: the evolving landscape of esports integration in professional football clubs

The implications derived from this study provide valuable insights into the management of esports activities by professional football clubs. Particularly, the observed progression in the organisational integration of esports activities influences management approaches and sheds light on factors shaping this dynamic process.

In the initial stages of esports integration, commercial considerations play a pivotal role, with clubs leveraging the expertise of their marketing departments or external agencies. This aligns with the broader literature on sport business, emphasising the commercialisation and branding aspects of esports (Lefebvre et al., 2020). However, as the integration advances, the emergence of distinct esports directors and departments within clubs becomes evident. The focus is shifting from commercial profit to the drive for success in sports competitions. This process represents a transformative process wherein esports, primarily considered a form of digital entertainment (Funk et al., 2018), assimilates characteristics and structures inherent in traditional sport. This phenomenon reflects an evolution called sportification, extending esports towards a more profound integration with the principles and objectives associated with conventional sport (Heere, 2018). The sportification of esports introduces a holistic approach that aligns with the values and structures of traditional sport, fostering a sense of legitimacy and recognition within the broader sport ecosystem (T. V. L. Scholz & Uebach, 2021). Furthermore, this dynamic aligns with the tenets of sport innovation research, which emphasises the multifaceted nature of value creation in sport – encompassing profit, winning, and social impact (Hammerschmidt et al., 2022).

Despite this convergence, esports is predominantly perceived as a business model, with commercial barriers identified as constraints limiting its conceptual expansion. This perspective indicates that, while integration progresses, challenges remain in fully embracing esports as a holistic sporting endeavour within the organisational framework. This process would be supported if clubs align their esports strategy with broader organisational objectives.

The structural implications for sport organisations are noteworthy, especially in the advanced stages of integration where esports is positioned as a parallel team alongside traditional teams (men’s, women’s, youth). This shift underscores the maturation of esports within football clubs, recognising the necessity for specialised sport management structures and competencies to navigate the multifaceted esports landscape effectively (Flegr & Schmidt, 2022). Distinct club factors influencing the progression of esports integration, such as innovative capabilities, managerial competence or esports strategy, highlight the nuanced nature of this process.

Towards an advanced understanding of managing tradition and innovation in sport

Implications drawn from our study regarding the management of innovative esports activities within the systems of tradition and innovation contribute to general principles in sport innovation research. The findings provide valuable insights that challenge and refine fundamental assumptions within this field.

This study can confirm the current literature that several football clubs are in a highly traditional environment, which contributes to inertia in innovative decisions (Thiel & Mayer, 2009; Wolfe et al., 2006). However, the results indicate that both systems can coexist, are not mutually exclusive, and can even cross-fertilise. Hence, our study indicates that tradition and innovation in sport organisations interact orthogonally rather than opposed. The herein suggested management of ambidexterity adds another perspective to current literature, which presents tradition and innovation as counterweights and therefore proposes the management of balance (Næss & Tickell, 2019).

Based on the first assumption, the identification of hybrid clubs has profound implications for both theory and practice in the management of sport organisations. The connection between managerial capabilities and the identity of hybrid clubs is crucial, suggesting that the development and enhancement of management skills are pivotal for success within the tension of tradition and innovation. The emphasis on managerial capabilities calls for a deeper exploration of the specific skills and competencies required in sport organisations. An understanding of how managers acquire and apply these skills can provide insight into best practices in sport management (Jones et al., 2014). Moreover, underscoring the significance of fostering managerial ambidexterity emphasises the imperative for targeted educational initiatives (Teixeira & Forte, 2017). This could involve specialised training programmes, workshops, or knowledge transfer sessions that equip managers with the tools to manage both tradition and innovation strategically. The perspective presented in this study encourages to prioritise education and knowledge transfer to empower sport organisations in successfully manage tradition and innovation.

Limitations and future research

Like any research endeavour, our study is not without limitations, primarily stemming from the chosen methodology and the dynamic nature of the rapidly evolving field of study. The purposive sampling of clubs from the Bundesliga represents a constraint on the generalisability of our findings. As the influence of esports continues to expand, it is imperative for scholarly investigations to intensify their efforts in examining its effects on sport organisations and media enterprises. In addition, the type of study participants should be expanded to explore broader contextual, cultural, or political aspects.

Our research findings highlight the varying positioning of sport clubs, indicating that some organisations demonstrate superior performance compared to others. Building upon this, future studies could delve into exploring the factors that contribute to ambidextrous management capacities within innovative sport organisations. Furthermore, our results suggest a growing importance of inherent social factors within esports. This calls for further scholarly attention and investigation into the intersection of sport and social dynamics in the context of esports. In general, the exploratory and preliminary findings of this study highlight the need for more qualitative and quantitative evidence from different clubs, leagues, and sports to further validate and expand upon the insights gained.

Conclusion

The environment in most football clubs is distinguished by a robust commitment to traditional values. This prevailing context has prompted the notion that the dichotomy between upholding traditional values and adopting novel initiatives serves as the primary catalyst for innovation inertia within professional sport organisations. This study reveals the intricate interplay between tradition and innovation in the realm of sport, contributing to sport innovation research. By employing a multiple case study approach, we examined the innovative esports activities, their antecedents, and their impact on professional football clubs from the German Bundesliga. Esports has firmly established itself as a disruptive strategy within the sport and media industry, with its influence, sportification, and organisational integration poised for further growth in the years ahead. To comprehensively analyse the coexistence and interplay of tradition and innovation, we utilised the concept of ambidexterity as a robust theoretical framework. This framework shed light on the complex dynamics at play, indicating that the relationship between tradition and innovation in sport interact within a dynamic configuration rather orthogonally than opposed. As a result, our analysis revealed the emergence of four distinct club types that navigate the tension between tradition and innovation: Nascent, Innovators, Traditionalists, and Hybrids. Nevertheless, considering the complexity of different club environments and the factors influencing their managerial approaches, there is a high demand for more quantitative and qualitative evidence from different clubs and leagues in the sport industry.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Jonas Hammerschmidt

Jonas Hammerschmidt is doctoral student at the Business School of Lappeenranta-Lahti University of Technology (LUT University), Finland, undertaking research in the field of entrepreneurship and innovation. He holds a Bachelor’s degree in Sport Management from the German Sports University Cologne and a Master’s in Entrepreneurship from the University of Liechtenstein.

Sophia Haski

Sophia Haski is a Research Fellow at the Institute of Sport Economics and Sport Management, Department Sport Economics, at the German Sport University Cologne. Her research interests include (sport) entrepreneurship, innovation, entrepreneurial mindset as well as the development of entrepreneurship trainings.

Sascha Kraus

Sascha Kraus is Full Professor of Management at the Free University of Bozen-Bolzano, Italy, and Distinguished Visiting Professor at the University of Johannesburg, South Africa. He holds a doctorate in Social and Economic Sciences from Klagenfurt University, Austria, a Ph.D. in Industrial Engineering and Management from Helsinki University of Technology and a Habilitation (Venia Docendi) from Lappeenranta University of Technology, both in Finland. Before, he held Full Professor positions at Utrecht University, The Netherlands, the University of Liechtenstein, École Supérieure du Commerce Extérieur Paris, France, and Durham University, United Kingdom, as well as Visiting Professor positions at Copenhagen Business School, Denmark and at the University of St. Gallen, Switzerland.

Mareike Heinzen

Mareike Heinzen is a professor and researcher in Innovation Management, Leadership and Entrepreneurship at the University of Applied Sciences Koblenz, Campus Remagen, Germany. She heads a research group called the MIC (Managing Innovation and Collaboration) Group and the international Master Program Management, Leadership, Innovation in Remagen. She received her PhD in Technology- and Innovation Management from ETH Zurich, Switzerland and has worked for several years as a Product Manager for Daimler AG in various countries. Her research interests lie in innovation and collaboration topics related to entrepreneurship, sustainability and interdisciplinarity.