May 22, 2023

Have you noticed that Netflix has accumulated 5 million users on its ad-supported platform since it launched six months ago? However, Netflix’ co-CEO Ted Sarandos says they still have “a long way to go to build scale in advertising”. A quarter of sign ups on Netflix are people buying the newer “Basic With Ads” plan. But for marketers, when it comes to advertising on Netflix, frequency continues to be a concern. To counter, Netflix has results that show viewers are four times more likely to engage with an ad on its platform vs. other streamers platforms. They also lead the industry in frequency caps. That should overcome questions about frequency.

Netflix working on ad innovations

Sarandos said the platform will be working on advertisement innovations that will continue to help ads become better overall. A recent survey showed half of Netflix’ new users think the platform’s ads are too much. When the new “Basic With Ads” option began, media buyers were concerned with the ad inventory shortage and the cost per thousand was at $65. However, Netflix has fixed these issues and a majority of their content is now on the ad option.

Upgrades for Netflix subscribers

Netflix introduced a set of upgrades, including 1080p video quality (an increase from 720p) and the ability to stream on two devices simultaneously. The changes recently went into effect in 12 regions, including subscribers in Spain and Canada.

Are there still concerns about advertising on Netflix?

It will be interesting to see if this new ad-supported platform on Netflix with continue to grow, plateau, or start to decline. Will there still be concerns about advertising on this new platform? It seems like there are still a lot of questions regarding this new platform. However, we just have to wait to find out the answers.

Here's the latest revenue stream for Netflix

In addition to upgrading its ad-based subscription, Netflix will roll out its password-sharing fees in the US this summer in an effort to increase its revenue.

Cate Bender, the author, is Project Coordinator of Marketing Keys

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May 22, 2023