Impact Of Ad Free Subscription On Mobile Advertising

One of the industries that have witnessed immense growth in a short span of time is the entertainment industry. Today, the audience has a plethora of streaming channels available at their disposal. Of course, Netflix has been leading the show for quite a while. However, other players such as Amazon Prime Video, Disney+, MX Player and more are ready to catch up.

There’s a constant battle to create relevant content for the audience and the cost associated with content creation is not a joke. This year, the global spend on content is expected to reach USD 230 billion.

Streaming channels resort to advertising to make up for the hefty amount of money. Advertising has been at the core of securing revenue for streaming media. Netflix recently introduced its ad-supported tier in 12 countries, which costs comparatively less than an ad-free tier and may acquire new consumers for the streaming channel. Disney+ is another streaming platform keen on following the same strategic approach to generate revenue and bring in new viewers.

However, nobody likes interruption when they are in the middle of something they enjoy. Despite the informative nature of advertising, people are not fond of ads in the face. This predisposition of the audience has given an impetus to subscription models.

The rise in OTT channels has propagated the need for ad-free subscriptions. The ad-free services Hotstar Disney+, Prime Video and Netflix keep the audience occupied for more than half of all the time spent on streaming platforms.

In addition, several new streaming players are entering the market with ad-free tiers resulting in a massive audience streaming without ads. However, ad-free streaming may not be good news for advertisers as they will miss out on many opportunities to reach potential customers. One of the prime reasons ad-free subscription models become popular is the change in consumer behaviour patterns. People are used to having no interruption while enjoying streaming on Netflix and Amazon Prime Video.

As more and more traditional TV viewers move to streaming services, there are opportunities for marketers on streaming platforms. However, marketers must rework how they advertise on streaming channels and work towards making ads more entertaining, relevant and useful to win a place on ad-free platforms. With limited opportunity to promote on ad-free streaming platforms, marketers will have to think of intelligent product placement in TV series or movies, for that matter.

Netflix and Disney+ ad tiers will be a silver lining for marketers since most Indian youth would want to switch to a cost-effective subscription. However, this will allow marketers to tap into the audience of the streaming platforms and open a gateway for advertising money to come into the streaming industry.

Sahil Chopra

Guest Author Sahil Chopra is the CEO and Founder of iCubesWire, a leading Digital Marketing Solution and concept provider in India, providing a 360-degree environment to leading brands for their digital marketing needs. He is a highly motivated and adaptive digital marketing professional and internet evangelist with expertise in Internet Strategy development and execution. Sahil has over 9 years of experience in digital marketing across multiple traditional and emerging channels. Sahil completed his engineering from PTU and pursued an MBA from Symbiosis Thereafter he started his career with NIIT – Global E-learning Services where he was exposed to the concept of digital marketing.