Streaming viewers accept more ads for lower costs -report

A new study by Hub Entertainment Research shows streaming viewers tolerate watching ads to some extent, for lower costs. 

The survey collected data from more than 3,000 US customers between ages 14 to 74. 59% of the participants prefer to watch ads to save $4-$5 per month rather than paying more for ad-free versions of streaming platforms.  

However, there’s a limit to how many ads they’re willing to watch. Five or fewer ads for every 30 minutes of streaming is the key number. When the number increases to six to ten ads, only 38% of the participants are still willing.   

The research suggests that viewers prefer having choices and will switch between ad-supported and ad-free tiers to balance cost and experience. About 40% of respondents preferred a service with clear ad-free and ad-supported options, while only 22% favored a single “limited ads” option. This shows that ad-supported video is far from being outdated.

Results show non-subscribers find services with cheaper ad-supported tiers more appealing. Services like Max, Netflix, and Disney+ have introduced ad-supported subscriptions and they seem to be on the right track to attract new customers. Disney+ launched its ad-supported subscription tier at the end of 2022, and recently, Netflix killed its cheapest ad-free plan in the US and UK. 

Data also shows, among Disney+ subscribers, 33% find ads much better compared to other ad-supported services. The same sentiment is shared by 32% of HBO Max viewers and 27% of Netflix users. 

Streaming services need to be cautious about the number and length of ads they show. Viewers tend to lose interest and pay less attention when they feel overwhelmed with ads. 

According to The Hub study, engagement declined when there were more than 11 ads in a half-hour show or when individual ad lengths exceeded 90 seconds. In short, longer and more frequent ads receive less attention from viewers.