Netflix’s ad-supported tier has become a runaway success, attracting a massive 40 million global monthly active users in just over a year.
This explosive growth comes with the increasing popularity of ad-supported streaming options, backing Netflix vision for an in-house ad tech platform.
Launched in late 2022, the ad-supported tier has seen a commendable rise in users. Having started with just 5 million users the platform has grown eightfold in a year, showing its appeal to viewers seeking a more affordable way to access Netflix’s huge library of content.
This surge in users is particularly unique considering the continued presence of the traditional, ad-free subscription model. Interestingly, over 40% of new sign-ups in regions with the ad tier opt for the cheaper option, implying the dynamism in user preferences.
Beyond the outstanding user base, Netflix emphasizes the high level of audience engagement on the ad-supported tier. Data from Nielsen reveals that over 70% of ad-supported plan members watch for more than 10 hours per month, a figure higher than competitors.
This attractive audience size brought a valuable asset for advertisers seeking to reach a specified viewership.
To further enhance the ad experience, Netflix plans to launch its own ad tech platform by the end of 2025. This move gives them greater control over how ads are displayed, potentially allowing for personalization and exploration of new ad formats.
Additionally, partnerships with industry leaders like The Trade Desk and Google will expand advertiser buying options, offering them more flexibility in reaching Netflix’s engaged audience.
Netflix understands that high-quality content remains key to viewer retention. Bela Bajaria, Netflix’s Chief Content Officer, announced a diverse slate of new series, movies, and live events, targeted at a wide range of genres and audiences.
This focus on creating great content ensures viewers stay hooked and spend more time on the platform, further increasing the value proposition for advertisers.
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