New Netflix Ads Tier Features An Unforeseeable Price

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The viewpoints expressed within this story are exclusively the author’s and do not reflect the views and beliefs of Best SMM Panel or its affiliates.

With the looming economic obstacles, consumers are scrounging everywhere to save money.

After receiving consumer pushback from raising its subscription rates, Netflix rolled out its latest tier: Basic with Advertisements, in November 2022.

The ads tier subscription is $6.99 monthly– practically 55% lower per month than its Standard subscription.

While the monthly cost is lower for consumers, the latest tier includes covert cost.

Unpredictable Advertisement Timing

In the new Netflix Basic with Ads tier, users can anticipate around 4-5 minutes of ads per hour.

How is this equivalent to other Connected TV memberships?

Image credit: Table developed by the author, November 2022. Sources of details are linked in the image. While the amount

of ad time per hour for Netflix is comparable to other streaming services, the sticking around issue is when an advertisement will show. Ad timings are unpredictable, which disrupts the user experience. The video content for ads is about what you expect compared to other streaming services. But the exact same problem is at hand– when will this appear in a user’s viewing experience on Netflix? According to Jay Peters from The Edge, a user’s ad

experience differs considerably between kinds of material taken in: Image credit: Jay Peters, TheVerge.com

As you can see from this example, the quantity of ads, along with the positioning of advertisements, is inconsistent, which leads to believe that Netflix is testing to find the very best engagement for not just users but advertisers.

Particular Titles Come With A Premium Rate

The 2nd nuance with Netflix Fundamental with Advertisements tier originates from what programs and films are used at this level.

Similar to the unforeseeable advertisement experience, the available titles on the Basic tier appears extremely scattered without a rhyme or reason.

The restriction should not come as a surprise to users, as Netflix announced this back in July.

Titles that aren’t readily available for Standard users will reveal a red padlock, suggesting that it is limited.

The red padlock appears to be a passive “Call to Action” due to the fact that users can click on the padlocked title, which takes them to an upgrade screen.

I theorize that Netflix’s subscriber method is to attract new users to the service or get previous subscribers to come back at a Basic price level. This can help grow and scale their subscriber numbers after toppling since increasing rates.

When a user is in, limiting titles that might be a “must have” for users tries to reveal users the value of upgrading.

How Can Marketers Projection Connected TV Engagement?

Linked TV ads aren’t brand-new to customers. Brands invested over $400 million in ads on Hulu alone in 2021.

In economic uncertainty, consumers may be willing to sacrifice their viewing experience to consist of advertisements while attempting to save cash. But if the viewing experience dwindles, consumers might be less likely to engage with Connected TV ads.

While it’s prematurely to tell about Netflix Basic with Advertisements, a typical gripe from customers on other streaming services is the lack of variety in ads.

Back in 2021, Morning Consult performed a survey to customers about their experience with streaming services ads. According to the study:

  • 69% of users believed the ads they received were repeated
  • 79% of users were bothered by that experience

So, what does this mean for advertisers?

Depending on how you take a look at it, online marketers might see this as:

  • An opportunity. If there are a lot of duplicated ads, this could imply that competition is low on Linked TV/OTT. If this holds true, the opportunity for brand awareness could be more cost-effective for you before the OTT market ends up being too saturated.
  • An indication to keep away. If streaming services do not fix the customer’s seeing experience, users are less most likely to engage with advertisements. And if titles are being limited at a greater rate, customers might churn off at a much faster rate than in the past. This, in turn, suggests a high Cost Per Engagement for marketers. This might be a more risky financial investment for brands with restricted budgets.

Summary

The newest Netflix rate tier enables them to compete with other streaming services at a lower price. It’s an excellent tactical move on their part, and it opens up the OTT area for advertisers to get in front of users who might not utilize other streaming services.

While the strategy type is new, Netflix (along with advertisers) should keep track of user engagement carefully and make any strategic pivots required to maximize engagement and subscriber development.

While Netflix advertisements are open to bigger ad companies, I expect them to present an in-house marketing platform comparable to Hulu sometime next year.

Have you attempted Linked TV/OTT ads yet? What has been your experience? Are they worth the investment?

Featured Image: Koshiro K/Best SMM Panel