Netflix Subscribers Okay With Ads if They Get a Discount
For something that doesn't exist—and probably never will—the idea of an ad-supported Netflix tier gets a lot of attention. The latest comes from Hub Entertainment Research, which finds many Netflix subscribers are fine with ads, but more so if they get a nice discount.
If Netflix were to add ads but keep its subscription price the same, 23% of current subscribers say they would drop it and 41% would keep it. But if the price were $3 less then only 12% would drop it and 60% would definitely keep it.
In that case Netflix would have to decide whether or not the revenue from advertising would make up for the potential shortfall in lost subscription fees. The advertising community would love to serve targeted ads to Netflix's cord-cutting viewers, but the company has always said it will remain ad-free.
Hub also asked subscribers which Netflix plan they would pick if they had a choice between the current experience and a lower-cost plan with ads (as Hulu offers). If the price were $1 less, 34% would take the discount and watch ads. But if the price were $3 less, 46% would make the switch.
Hub's data comes from a survey of 1,765 broadband customers in the U.S., and is part of the company's Monetization of Video study, available to members.
The constant drip, drip, drip of bad news for the SVOD leader has taken its toll, and viewers are leaving en masse. Suddenly the giant doesn't look so powerful.
Also, Vudu creates a massive ad targeting network using Walmart first-party data and Vice bans the blacklist (in the name of diversity).
Starting next year, YouTube will begin moving produced content from behind the paywall, and will create more celebrity-driven, mainstream titles.
When prices go up, viewers are more willing to drop their Netflix subscriptions than their pay TV accounts, finds Hub Entertainment Research.