Netflix Adding New Feature to Ad-Supported Plan Allowing Binging Users to Watch One Episode Ad-Free
Once users watch three episodes with ads in a row, they’ll be rewarded with a fourth ad-free episode.
Netflix really, REALLY wants you on its ad-supported plan. The world’s biggest streaming platform sees its Standard with Ads tier as one of its primary profit drivers in the coming years, but before that can happen it has to have many more customers signed up to that particular tier.
- Netflix is adding a new feature to Standard with Ads that allows users to watch one ad-free episode once they’ve seen three ad-supported ones.
- The feature is intended to reward binge-watching; a recent survey found that 66% of streaming users identify as binge viewers.
- Netflix’s Standard with Ads has accounted for 28-30% of new signups this past quarter, but the plan has a long way to go.
Binge Rewards
‘Squid Game’ may be released in batches for Season 2, making it more difficult for customers to binge all the way through.
According to The Hollywood Reporter, Netflix unveiled plans for what it is calling a “binge” reward during Advertising Week New York on Tuesday. It’s a new feature intended only for the Standard with Ads plan, which brings in more average revenue per user (ARPU) than the company’s ad-free streaming options do.
The reward is intended to allow users who watch three episodes in one sitting to view their next episode ad-free. The tradeoff is that users will have to sit through a 30 or 60-second ad before their commercial-free episode begins. The move could definitely help attract even more users to Standard with Ads; research recently conducted by Antenna shows that while Netflix has seen 28-30% of its new signups opt for the ad-supported plan in the third quarter, Standard with Ads only accounts for 5.75% of American customers total.
This is not the first time that Netflix has tried to bring new users to Standard with Ads by improving the customer experience. In April, the streamer upgraded the maximum video quality on the plan to 1080p, among other upgrades designed to make the ad-supported tier more attractive to potential subscribers.
There were other innovations announced by Netflix at Advertising Week New York, but they were mostly of interest to advertisers. These include new title sponsorships that allow a specific brand to become the premier sponsor of a show or movie, and sponsorships for its live events, such as the upcoming “Netflix Cup” celebrity golf tournament.
New Opportunities
These new advertising strategies by Netflix could be an outgrowth of the changes it made in its deal with Microsoft, which helped build the software necessary to show ads alongside Netflix content. The two sides agreed to modifications to that deal in late July, and as part of the new deal, Netflix was allowed to seek more opportunities outside Microsoft.
Netflix has also reportedly lowered the amount it asked for from advertisers per 1,000 views on its platform. Advertisers are now more eager to do business with Netflix, which still has the most powerful brand in the streaming industry for them to capitalize on. These innovations and policy changes should help Netflix continue to rake in profits while most other streaming platforms are still trying to figure out how to get into the black.
Netflix
Netflix is a subscription video streaming service that includes on-demand access to 3,000+ movies, 2,000+ TV Shows, and Netflix Originals like Stranger Things, Squid Game, The Crown, Tiger King, and Bridgerton. They are constantly adding new shows and movies. Some of their Academy Award-winning exclusives include Roma, Marriage Story, Mank, and Ma Rainey’s Black Bottom.