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Netflix’s Ad-Supported Plan Growth
Netflix’s subscription plan including ads, priced at $6.99 per month, has witnessed a significant surge in active monthly users. The number of individuals subscribing to this ad-supported plan has sky-rocketed by a staggering 700%, reaching a total of 40 million users in the current year, as compared to just 5 million in the previous year. This announcement was made by the streaming giant during its upfront presentation to advertisers.
The Evolution of Streaming Services
With the inception of streaming services, subscribers were promised access to an extensive library of movies and TV shows without any interruptions from ads, all for a reasonable monthly fee. However, over the years, streaming platforms have started incorporating advertisements as an additional revenue stream. Notably, Netflix and Disney+ introduced ads to certain subscription plans towards the end of 2022, with Amazon Prime Video following suit this year. It is worth noting that Netflix revealed that 40% of all new signups opt for the $6.99 ad-supported tier, whereas the standard ad-free plan is priced at $15.49 per month.
The Battle for Advertisers’ Attention
Throughout this month, streaming platforms and television networks have been competing to capture the interest and investments of advertisers, as evident from their annual upfront presentations. Netflix highlighted the high engagement levels of its audience, with over 70% of ad-supported subscribers watching 10 hours or more of content each month. Bela Bajaria, Netflix’s Chief Content Officer, emphasized the engaged viewership by stating, “Our audiences are highly engaged — and by engaged I mean that they are choosing to spend their time watching Netflix. When people watch our shows and movies, they get more value from Netflix, they stick around longer, and they’re more likely to recommend us to their friends. And this matters to all of you because you want to be where the audiences are, too.”
Amazon, in a recent update, hinted at the introduction of innovative interactive ad formats for its video streaming service, adding further competition to the advertising landscape.
Insights by Numbers
- 37: The median age of subscribers to Netflix’s ad-supported plan
- 20: The average number of hours that over half of subscribers on Netflix’s ad-supported plan watch per month
- 270 million: The total number of subscribers across all Netflix plans
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