Ben Bold
May 10, 2022

A third of UK consumers would cancel Netflix subscription if it became ad-funded: survey

LoopMe research also indicates that password sharing is prevalent among UK consumers.

A third of UK consumers would cancel Netflix subscription if it became ad-funded: survey

The findings come the month after Netflix's share price fell by almost 40% after it reported losing 200,000 subscribers in the first quarter of 2022. Its chief executive subsequently confirmed that ads would be on the menu at some stage in "the next year or two".

LoopMe's research also unearthed some telling results around sub-sharing. Just 14% of the 2,922 consumers surveyed said they subscribed to streaming services, while about half admitted they currently used Netflix – a strong indicator that users are password-sharing, which Netflix is clamping down on. Netflix itself has said about 100 million households are sharing subscriptions.

Meanwhile, the survey found that as consumers tighten their purse strings in the face of cost of living price hikes, nearly half (47%) of consumers considered affordability as their main reason for cancelling a streaming service subscription. Netflix's monthly subscription prices have risen twice in a year-and-a-half, with its mid-level option recently going up by £1 to £10.99. Nine per cent said they had cancelled one streaming service in the past month. Again, this was most pronounced among older consumers (55- to 64-year-olds).

Aside from affordability, 10.4% of respondents cited more competitive offerings on the market as the biggest reason to cancel, while 8.5% selected the presence of advertising, and 5.6% advertising that is annoying or irrelevant.

It is not only financial pressures that are leading Netflix customers to reconsider their relationship with the streaming service and its rivals, such as Disney+, NowTV and Amazon Prime Video. A "lack of interesting content" was cited by 29% as the biggest reason to cancel a streaming service, with women twice as likely as men to cut ties for this reason.

Sarah Rew, LoopMe's senior director, global marketing, said that it was "no surprise that people would find ways to save money where they can".

She continued: "It's clear Netflix will have to consider its affordability moving forward, with an ad-funded model a potential way to offer content at a lower cost. However, this might not be enough to retain or attract new subscribers.

"Netflix would have to focus on delivering relevant, quality content – both in terms of programming and advertising – with a full understanding of how brand advertising could enhance its offering, rather than detract from the experience."

Campaign recently asked a group of top media buyers and analysts for their thoughts on ads heading to Netflix. There was understandable excitement at the prospect. However, many said that the most likely outcome would be ad-free tiers coupled with ad-supported packages.

Source:
Campaign UK

Related Articles

Just Published

14 hours ago

Agency Report Card 2024: Ogilvy

Ogilvy APAC celebrated a strong creative year in 2024, clinching top regional honours at Cannes Lions. Yet operational headwinds, particularly in China, tested its resilience and reshaped its growth strategy.

15 hours ago

Campaign Global Agency of the Year Awards 2024: ...

Ogilvy and UM win global network of the year awards for creative and media respectively, while Special agency in New Zealand earns Asia-Pacific network of the year.

16 hours ago

Apple Watch’s heart story strikes a chord in Japan

Apple’s new Japan campaign tells the real-life story of a heavy metal fan whose Apple Watch alerts help detect a life-threatening heart condition just in time.

16 hours ago

2025 Cannes Contenders: RGA creatives weigh in

A ubiquitous surname, a sexually transmitted infection, the printing of memories and an animal god that helps gamers might all bring fame glory to campaigns in Cannes next week.