After winning millions of viewers from television channels, Netflix intends to delight their precious advertisers: the streaming giant is launching its new subscription with advertising in November in twelve countries, in the hope of reviving its breathless growth. “We believe strongly that a lower price to consumers, along with strong ad monetization, is going to allow us to grow our subscriber base and over time generate significant incremental revenue,” said Greg Peters, COO of the Californian group, during a press conference on Thursday. fifteen to thirty seconds, broadcast at the beginning and in the middle of the programs. The basic offers without advertising will remain at their current price ($9.99 in the United States and 8.99 euros in France). own offer with advertising in December, for $7.99 per month, while its basic subscription will increase to $10.99. Audiences’ transition from live television to on-demand programs, via the Internet, “has accelerated to the point that streaming has overtaken traditional channels and cable in time spent watching the TV in the United States,” said Greg Peters. “Netflix’s share of that TV time in the US is still only 8%, but that’s more than any channel, which I think is important for advertisers,” he said. – he added. Out of stock In the first quarter of 2022, Netflix had lost 200,000 subscribers worldwide compared to the end of 2021. The news had caused its stock price to plunge by 25%. Then, from March to June, 970,000 subscribers left the platform. The pioneer of the sector, which has more than 220 million subscribers in all, has taken two major decisions to reverse the trend. It will tighten the screw on the side of the sharing of identifiers and passwords, which allow many people to access the platform without paying. And he resolved to offer a subscription formula with advertising, and even to accelerate its advent, after years of refusing this less prestigious solution. Concretely, the users concerned will see an average of four to five minutes of advertising per hour. Their catalog will be restricted by around 15%, as Netflix cannot advertise certain licensed films and series. , but broadcast only at the very beginning. The reduced price will “attract consumers”, believes Ross Benes of Insider Intelligence, “but since none of the Netflix users are seeing ads at this time, it will take some time before a large share of current viewers does not adopt this formula.” Advertisers, from car and luxury brands to tour operators, have responded in droves, according to Jeremi Gorman, director of advertising at Netflix. “We pretty much sold out our inventory for the launch,” she said. Ad Targeting When it comes to targeting, they will be able to choose countries and genre (comedy, action, documentary…) and exclude certain characteristics (violence, nudity …), following the predominant model on traditional television. Netflix, with the help of its partner Microsoft, will collect information such as the gender and age of its users and plans to do so-called behavioral advertising targeting, i.e. personalized according to people’s preferences. , as on the Internet. “It’s a win-win for advertisers and for our subscribers,” assured Jeremi Gorman. “For people who will choose the formula with advertising, it is important to show them ads that correspond to them and speak to them.” Personalization also drives up prices for brands, as finely targeted ads at scale bring better returns on investment. in late August, advertisers will initially have to shell out around $65 to target 1,000 viewers, and possibly $80 thereafter, a price considered higher than on other streaming platforms. According to Insider Intelligence, ad revenue from streaming could hit $30 billion within two years in the US alone, and likely at least double that globally. The market is currently crushed by YouTube.
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