Study: Most SVOD Services to Introduce Ads in the Next Two Years

Study: Most SVOD Services to Introduce Ads in the Next Two Years

More than 76% of subscription streaming VOD services plan to add commercialized content by 2025, according to analysis released by data analytics company NPAW, which interviewed 250 online video business owners worldwide about their business models, advertising, and measurement practices and challenges.

As the global video streaming market continues to grow and become increasingly crowded, streaming businesses are looking for ways to maintain their growth and competitive edge.

Implementing a hybrid model (an ad-supported tier plus a premium, subscription-based one) is the preferred path for 59% of respondents — a move respondents said is aimed at lowering the price of subscriptions.

The survey data suggests ad-based video streaming models are on the rise because of their potential to increase platform revenues and reduce subscription prices, a win-win for streaming services and consumers in a time of economic uncertainty and market saturation. The data also underscores that the adoption of third-party video and advertising analytics in the industry is still fairly low, yet quickly increasing as providers recognize the strategic advantage of comprehensive real-time data.

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The report found that about half of streaming companies (47%) are already using a third-party video analytics tool to track platform performance and user behavior, while 39% plan to do so.

The report also found that 100% of ad-based video services plan to implement a third-party advertising analytics tool this year. Despite the still fairly low adoption levels of third-party ad analytics tools, all ad-based streaming companies currently not using one are planning to do so this year, with 34% saying they will implement one within months, while 44% saying they will deploy one by the end of 2023.

“It’s encouraging to see that more and more companies are taking a data-driven approach to running their video business, especially as the industry’s shift to ads brings a unique set of measurement challenges,” Till Sudworth, chief marketing officer of NPAW, said in a statement.

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