Netflix Ads Could Lose Streaming Service 1/4 Of Its Subscribers, Study Says
By Hoai-Tran Bui/Sept. 14, 2018 8:30 am EST
However, recently Netflix announced that it would be experimenting with non-skippable ads promoting its other programming. And a new study says that the addition of Netflix ads could have lasting consequences for the streaming service.
According a recent study by Hub (via IndieWire), about a quarter of 1,612 U.S. TV viewers between the ages of 16-74 surveyed said that they would unsubscribe from Netflix if the streaming service added ads. Specifically, 23% said they would unsubscribe, while 41% said they would definitely or probably keep their subscription. 37% remained undecided.
In the release accompanying the survey, Hub principal and study co-author Peter Fondulas said:
However, these numbers are under the condition that Netflix pricing remain the same despite the addition of ads. If subscription rates were hypothetically lowered by $3 a month, the Hub survey found that only 16% of viewers would cancel their subscriptions, while 50% would definitely or probably stay on board.
“When we ask subscribers what they consider to be the most attractive features of Netflix, the fact that it’s ad-free consistently ranks toward the top of the list. For the moment, that remains a key distinguishing characteristic of the service, especially as other OTT providers attempt to compete with high-quality original shows of their own.”
This study comes on the heels of Netflix’s experimentation with a new feature which interrupts binge watching sessions by inserting “full-screen videos, personalized to the user, featuring content Netflix would have otherwise suggested elsewhere in its user interface” in between episodes. It was a test feature that immediately sparked outrage among subscribers who pay for the one big service that still avoids ads. It’s like Netflix’s homepage algorithm invading your nice binge-watch session of American Vandal to yell that “you should totally watch Insatiable.”
But if users are offered differently-priced packages for ad-free or limited ad experiences, then there probably wouldn’t be a dramatic drop-off. It’s just a matter of Netflix being transparent with its subscribers. And maybe stop trying to make us watch Insatiable.
