Netflix’s ad-supported subscription tier is gaining traction in the UK, according to new data from measurement body Barb, as the streaming giant looks to build reach for its ad offering. And the ad tier is seemingly the sole driver of Netflix’s subscriber growth in the UK, suggesting the cheaper subscription offering if proving successful in preventing subscriber losses.
Over 2.7 million households in the UK have access to Netflix’s ad-supported subscription tier, according to Barb’s latest establishment survey data, which charts total household reach for major CTV services. This is a significant jump for the service, up from 2.1 million households in Q1.
Barb’s data suggests that sixteen percent of all Netflix subscribing households in the UK are now signed up to the ad tier. This figure means that Netflix’s ad tier now reached nearly one in ten UK households (9.5 percent).
Return on ad investment for Netflix
Digging into the numbers further, it’s clear that the ad tier drove Netflix’s overall growth across the quarter. The ad tier’s reach jumped from 2.12 million households to 2.78 million – meaning growth of 660,000 households. Meanwhile Netflix’s overall subscriber count increased from 16.7 million households in Q1 to 17.1 million – meaning total growth was around 400,000 households.
Thus, without the 660,000 households added onto the ad-supported tier, Netflix’s subscriber count would have been down by over 200,000.
Barb’s data doesn’t indicate the dynamics behind these changes. Some of the additions to the ad tier would likely have come from households unsubscribing from a more expensive ad-free tier. Some would have been new additions to the platform. The balance of these two groups isn’t clear.
Regardless, Netflix’s ad-supported tier was the sole growth driver for Netflix across the period, and prevented a fall in Netflix’s total Uk subscriber count.
A strong quarter across the board
Barb’s data also reported on Disney+’s ad tier for the first time.
Disney+ is currently the third most popular streaming service in the UK, according to Barb’s data. Its total reach of 7.6 million households puts it behind Netflix (17.1 million) and Amazon Prime Video (13.7 million).
Total reach for its ad-supported tier sat at around 820,000 by the end of Q2, meaning roughly ten percent of UK households with Disney+ are subscribed to its ad-supported tier. Since this is Barb’s first time reporting on Disney’s ad tier, it’s not clear how much – if any – growth came over the last quarter. Disney+’s total household reach was flat between Q1 and Q2.
By and large, it was a healthy quarter for streaming services across the board, as most either grew their total household reach, or at least remained flat.
Amazon added around 700,000 new households, Paramount+ added roughly 200,000 (reaching 2.8 million in total), and Discovery+ and NOW both added under 200,000.
“Building on strong growth in Q1 all services on the tracker saw a quarterly increase in the number of homes with access,” said Doug Whelpdale, head of insight at Barb. “The challenge will be to maintain this momentum. Q3 2024 will be a key test to see if the pure-play VOD services can avoid the plateaus of the last three years, but 2024 appears to be going well for these services so far.”
