Netflix now has 70m global monthly active users for its ad tier, the streaming giant has announced.
It amounts to a 75% increase in users since Netflix last provided an update on the number of ad tier members in May (40m). This time last year, amid the one-year anniversary of its ad tier, Netflix had just 15m users.
According to Netflix, over half of new sign-ups in ad-supported markets are for the ad tier plan.
In its Q3 earnings released last month, Netflix reported ad tier membership grew 35% quarter on quarter; however, it did not release an update on the total number of ad tier subscribers, nor did it announce ad revenue figures.
Netflix will stop reporting subscriber figures as part of its quarterly earnings beginning in Q1 2025.
In-house adtech launches as part of advertising roadmap
The user growth update comes after Netflix officially launched its own in-house adtech stack in Canada on 1 November. This allows advertisers to control their ad buys directly within the Netflix platform rather than through a third-party service.
In Canada, the service is operating solely on Netflix’s own adtech.
Netflix’s move came after the company expanded its programmatic partners for advertisers in May beyond its once-exclusive deal with Microsoft. Buying capabilities were subsequently enlarged to include Google’s Display & Video 360 (DV 360), The Trade Desk and Magnite.
Netflix ads president Amy Reinhard previously said that “bringing our adtech in-house will allow us to power the ads plan with the same level of excellence that’s made Netflix the leader in streaming technology today”.
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Netflix will be rolling out its in-house adtech globally in 2025. While Canada will be used to test and improve the product before a wider launch, the streaming platform has already said it intends to introduce “enhanced forecasting capabilities and new targeting, reporting, measurement and insights” in the future.
The company has also expanded its programmatic offering, with programmatic guaranteed buying now enabled in the US, Brazil, Canada and Mexico through its partnerships with the likes of The Trade Desk and DV 360. The feature will expand to Europe in February.
Co-CEO Greg Peters previously signalled that, following “significant progress” in growing the total number of ad tier subscribers, the streaming giant will “turn more attention” to “effectively monetising all that growing inventory”.
“I think it’s worth noting we’ve got a lot of work still ahead of us to achieve that goal, to make our offering better for advertisers,” he said last month. “It’s going to be a priority for us for several years coming, but we’re moving. We’ve got a roadmap for more formats, for more features, for more measurement. That’s all coming.”
However, ads are not expected to be a “primary driver” of Netflix’s 2025 revenue, although the company does expect its ad revenue to double next year off a small base.
Measuring engagement
For advertisers, reliable measurement capability remains a sticking point for investment in streaming services. To that end, in the UK Netflix last month expanded its relationship with Barb to include measurement of audiences for its ad-supported plan.
Netflix co-CEO Ted Sarandos has recently challenged its rivals to also be more transparent with their viewership numbers. At a September conference in New York, he said: “[T]his idea is that the number is out there so that talent can see it, so that agents can see it, so that the press can see it and know what’s a hit and what’s a miss.
“I don’t think we could be any more transparent than that. I’m hoping that the other folks in the business will follow suit.”
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According to Barb survey data this summer, Netflix has been dominating UK subscription VOD (SVOD) usage in the UK, with the streaming service being watched in nearly six in 10 UK homes (59%). Ad-supported viewers also reportedly watch twice as much Netflix on average than they do other streaming competitors.
Warren Dias, Head of Advertising Sales UK, told The Media Leader that while the ad tier subscriber growth is “amazing”, what he finds “especially exciting” is the depth of user engagement on Netflix as denoted by Barb.
“This shows just how much members love our titles and we’ve had a bumper year,” said Dias. He further pointed out that four of Netflix’s 10 biggest shows by audience were UK productions (Fool Me Once, Baby Reindeer, The Gentleman and One Day).
Live events driving partnership
For Netflix’s expansion into showing live events, the company has partnered VideoAmp in the US to evaluate live programming reach, beginning in January with its weekly stream of WWE Raw.
Netflix’s live broadcasting has received interest from advertisers looking for partnership opportunities, as have the streamer’s tentpole TV releases.
Netflix will for the first time be the home of two US National Football League (NFL) games on Christmas Day this year, in a licensing deal costing the company $75m per game.
The streamer has sold out all available in-game inventory for both games. Major partners include FanDuel as betting partner and Verizon Fios for a pre-kick-off segment.
Meanwhile, Kia has been inked as a core sponsor for the forthcoming series of Squid Gamewhich premieres on 26 December.
“Looking ahead to 2025, there are quite a few things I am especially excited about,” continued Dias. “From expanding programmatic to the UK in February with The Trade Desk and DV 360 to launching our in-house adtech later on in the year, the continued development of our measurement ecosystem and new targeting capabilities. We’re on track to build an impactful and successful long-term business.”
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