Netflix launched its ad-supported tier launched in November last year.
Six-and-a-half months in, the $5.99/mo plan has certainly been doing well for the streamer.
Netflix announced that its ad-supported tier has reached nearly 5 million monthly active users globally at a virtual presentation on Wednesday, May 17th (via Adweek). Basic with Ads launched in many countries beyond the U.S., including Canada, the UK, France, Germany, Spain, Italy and Japan. The company has the tier priced differently in different countries, but if we were to take a flat rate of $5.99 per subscription per month, the ad-supported tier is bringing in roughly $30 million CAD for the streamer every month.
During the presentation, Netflix detailed how it is doing well. It mentioned that it’s viewing across Nielsen’s Top 10 most-watched list was about three times higher than competitors combined in 2022, with the streamer having the number one original TV show on streaming in the U.S. for 15 out of 16 weeks, and the number one movie for 14 weeks.
According to the streamer, it has 232.5 million subscribers worldwide, with its ad-supported subscriber count more than doubling since early this year.
The company found that, on average, more than one-third of Netflix’s new subscribers now choose the ad-supported plan (in countries where it’s available), with nearly 80 percent of viewing taking place on TVs. The median age of Netflix’s ad tier users is 34, with more than 70 percent falling in the 18-49 demographic.
Netflix also touted its advertising effectiveness, citing data from Entertainment Data Oracle (EDO) that showed that viewers are more than four times as likely to engage with an ad on Netflix than other streaming services and more than four and a half times as likely to engage with an ad on Netflix than linear TV.
“We treat our ads with the same care we treat our incredible content: serving them locally; seamlessly transitioning between shows and ads with no latency; and implementing industry-leading frequency caps with an ad load of four to five minutes per hour,” said Jeremi Gorman, president, worldwide advertising at Netflix.
Netflix’s ad tier is part of its strategy to expand its reach and revenue in the increasingly competitive streaming market. The company has 232.5 million subscribers worldwide, and faces competition from rivals such as Disney+, Hulu, HBO Max and Amazon Prime Video.
Learn more about the ad-supported tier here.