TIERS FOR FEARS
Happy Holidays War & Peaceniks!
Before we start today’s newsletter, I want to say thank you, to you. This newsletter is now a year old, and it means a sh*t-ton to me that you read the thing. I wish you only happiness in the year ahead.
Now… Whiteboard Christmas!
The hot topic in streaming these days is “how will the new Netflix ad tier do?!” Based on information released in the last week, it seems Netflix’s ad stockings may be filled with coal this season.
Above you see data released this week by Antenna, which shows that only 9% of all sign-ups in November were for the Netflix ad tier. One month in, just 0.2% of all Netflix subs on their ad tier.
How does that compare to all the other ad/SVOD mixed platforms? Back to the whiteboard…
It’s fair to say “C’mon, man, they just got started! I’m sure they knew the ad-tier build would be slow. Give ‘em a break!”
I would. Except it’s quite clear Netflix did not plan for such a slow start, and that these numbers are far below their plan’s projections. Why?
“They can’t deliver. They don’t have enough inventory to deliver. So they’re literally giving the money back.”
– Ad Agency Exec
Prior to the ad tier launch, Netflix made a really bad first impression in agency world with pricey first impressions and some hubristic terms. So, falling so short on projected delivery isn’t a good look. “Lack of impressions” simplifies Netflix’s complex issues. First, you must understand the underlying reason their ad-tier is currently underdelivering eyeballs…
Because it sucks.
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