Avoiding commercials isn’t the most important thing to TV viewers according to a new study that finds consumers interested in enduring ads even on Netflix if they get a lower price for the service.
Hub Entertainment Research’s TV Advertising: Fact vs. Fiction report finds that on 17% of consumers said they can’t tolerate advertising and would never sign up for a TV service that has commercials. A whopping 57% said they can tolerate some ads and another 26% said that if the content is interesting, it doesn’t matter whether or not there are ads.
Consumers are even more tolerant of ads if they get a discount on the price of a subscription service, with 58% saying that if they got a $4 or $5 discount, they’d choose an ad-supported option, while 47% said they’d rather avoid ads.
Netflix has long said it would never sell advertising, making this new survey particularly interesting.
Hub found that if Netflix created a tier with pre-roll ads that costs $5 less per month, 46% of Netflix subscribers said they’d switch to the ad supported service. If there were a tier with pre-roll and mid-roll ads for $5 less per month, 39% would sign up.
Among the viewers who said they can’t tolerate ads, 73% said they subscribed to ad-free Netflix, 57% got Amazon Prime Video and 57% said they used a free streaming service with ads.
For the group that said content mattered most, 58% subscribe to Netflix, 44% to Prime Video and 52% use free ad-supported streaming services.
Hub found that 95% of viewers watch both ad free and at least one ad supported channels.
Hub asked viewers who recently watched a show with commercials to tell them how they felt about the ad load. Among viewers who thought they saw 5 spots or fewer, 47% thought the number was reasonable and 32% thought it was unreasonable. When viewers said they saw six to 10 spots, 33% called it reasonable and 34% said it was unreasonable. When they said they saw 11 or more commercials, just 27% thought it was reasonable and 49% called it unreasonable.
Among the viewers who said they saw five or fewer spots, 35% said they paid attention to all or most of the ad, while just 23% of those who saw 11 or more spots said they paid attention.
“What’s clear from these findings is that what matters to consumers is not whether ads are included in the content they watch, but how ads are delivered,” said Mark Loughney, Hub senior consultant and co-author of the study. “Even consumers who say they’re categorically opposed to ads will use an ad-supported platform if the price and ad delivery are right.”
Hub’s TV Advertising: Fact Vs. Fiction study is based on interviews conducted among 3,0001 US consumers ages 14-74, who watch at least one hour of TV per week. The data was collected in June 2021.
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Jon has been business editor of Broadcasting+Cable since 2010. He focuses on revenue-generating activities, including advertising and distribution, as well as executive intrigue and merger and acquisition activity. Just about any story is fair game, if a dollar sign can make its way into the article. Before B+C, Jon covered the industry for TVWeek, Cable World, Electronic Media, Advertising Age and The New York Post. A native New Yorker, Jon is hiding in plain sight in the suburbs of Chicago.