Roku Wants to Use Home Screen for New Types of Ads to Customers While Also Improving Content Discovery
Roku devices have the ability to reach 120 million people each day, and the company wants to use that opportunity to deliver more ads.
Roku wants to take the term “ad-supported” to another level. The company held its quarterly earnings conference call on Thursday, and revealed that 81.6 million households used a Roku device or smart TV to stream video in the first three months of the year. As part of the report, company CEO Anthony Wood laid out ideas for how the company would increase revenues in 2024. Unsurprisingly, advertising will be an important centerpiece of that strategy, and Wood provided some details on what Roku users can expect from their ad experience going forward.
Key Facts:
- Roku wants to embed video ads on its home screen, similar to the autoplay ads that came to Fire TVs in 2023.
- Home screen experiences can also be used to deliver more customized ads to viewers.
- Roku has also created a personalized content row that uses AI to point viewers toward recommendations.
The idea of bringing more ads to the Roku home screen is nothing new, but that’s what Wood focused on in his discussion with analysts about how to boost revenue on the Roku platform. The company has already begun putting more static ads on the screen, but now it appears that Roku is considering how to get video ads embedded into the home page as well.
Wood said that he believes that a video-enabled ad unit on the Roku home screen will be “very popular with advertisers,” considering that Roku devices have the reach to put ads in front of 120 million pairs of eyes every day. He also said that the company is “testing other types of video ad units, looking at other experiences” that it can bring to the Roku home screen.
The idea of putting video ads on Roku home screens sounds highly reminiscent of what Amazon has done with home screens on its Fire TV streaming players and smart TVs. Fire TV devices began playing full-screen video ads automatically when activated in November, and now it appears that Roku is ready to try something similar.
As another way to boost ad revenues, Wood suggested that the company’s home screen experiences could be leveraged to deliver more ads. He pointed to the NBA Zone, which Roku launched at the beginning of April as an example. Roku can use these themed content hubs to deliver ads more tailored to fans of that particular content, harnessing the power of popular sports to pull more ad revenue.
Has Roku Made Any Improvements to the User Experience?
Customers concerned that Roku will just gunk up their home screen with ads are likely wondering if the company has made any moves toward actually making the user experience on the platform better. The good news is that Roku has also introduced a recommended content row, that will compile picks from across various streaming services and use AI to point customers toward new shows and movies they might like.
“There’s lots of ways we’re working on enhancing the home screen to make it more valuable to viewers but also increase the monetization,” Wood said.
It remains to be seen how effective this new content row is in driving customers to new titles, however. A recent survey by Accenture shows that 52% of viewers report seeing titles within “recommended for you” rows that do not accurately reflect their viewing habits. Perhaps leveraging AI for Roku’s recommendation row will help solve that problem for the company, but only time will tell.
As a platform that does not require customers to pay for any type of subscription to use Roku devices or watch content on The Roku Channel, Roku must rely heavily on advertising for the bulk of its revenues. That explains why the company is seemingly always thinking about new ways to deliver ads to viewers, even if it creates a situation where Roku owners feel they’re constantly being bombarded with commercials.
Roku Channel
The Roku Channel is a free live TV streaming service that provides 350+ live linear streaming channels and more than 80,000 free movies and TV shows. The library contains entertainment from several different decades, including some major hits.