Netflix’s ad-supported tier is rapidly gaining traction, reaching 40 million monthly users globally, the streamer announced at its 2024 Upfront presentation.
The paid ad offering, initially seen as a risky move, has quickly become a hit for Netflix as it seeks new revenue streams amid intensifying streaming competition.
Why we care. Netflix’s platform offers advertisers a large and expanding pool of potential customers. If you’re looking for new advertising opportunities, you may want to explore streaming audiences.
Driving the news. Just six months after hitting 5 million ad-supported subscribers post-launch in late 2022, that number has now swelled to 40 million.
In regions where the ad tier is available, over 40% of new Netflix sign-ups are opting for the cheaper ad-supported plan.
The service now has 270 million total subscribers across all its pricing tiers.
Between the lines. Netflix is doubling down on the ad business by bringing its ad tech in-house.
It’s launching its own advertising platform to “power the ads plan with the same level of excellence” as its streaming tech, per Netflix’s president of advertising Amy Reinhard.
While initially partnering solely with Microsoft, Netflix is now also tapping Google, The Trade Desk and Magnite for its ad sales and tech.
What they’re saying. “Our ad membership has been an overwhelming success,” Netflix co-CEO Ted Sarandos said during the presentation. “We’re just getting started on that journey.”
The bottom line. Netflix’s ability to rapidly scale its ad business demonstrates the power of its brand and content – signaling a secure new revenue pipeline as it branches further into advertising.
