- Video Streaming in the US is saturated, reaching 96% of, or 124M, US households, only growing 1% quarter-on-quarter.
- Average number of paid services accessed per household continues to rise, with US households now subscribing to 4.0 paid services on average.
- Ad supported video services are driving growth in US video streaming, with AVoD (paid, ad-supported) and FAST (free, ad-supported) both growing their user base by 3% in the quarter, while SVoD (paid, ad-free) shrank its user base by -0.6%.
- Sports are driving growth in streaming, with the fastest growing services including ESPN+ and DAZN.
- Prime Video, Samsung TV Plus, and ESPN+ saw the greatest absolute growth in number of subscribers over the quarter.
- Netflix ad-supported tier grew by 2% in subscribers, while it’s ad-free offering shrank 2% quarter-on-quarter.
- The top 3 titles cited as most enjoyed in Q2’24 include NCIS (available on Paramount+ and Netflix), followed by Fallout (available on Prime Video), and Bridgerton (Netflix).
Ad supported Video Streaming sees growth as total market is flat
The total VoD (Video on Demand) market grew by just 1% in in Q2’24. Within VoD, paid ad-free streaming (known as SVOD) shrank in the quarter, losing a net half million subscribers. Meanwhile, ad-supported streaming, both paid (known as AVoD) and free (known as FAST) combined, grew by roughly 6%, adding 3.8M net streamers to the category.
In Q2’24, Kantar took a deeper look at the ad space in streaming, and how streamers think about and interact with ads. Kantar found that although ad-supported streaming is driving the category forward, keeping a streamer’s attention during an ad remains a challenge.
Over half of video streamers say they mute or do not watch ads. Streamers are also very divided on their opinion of targeted ads, with only 1/3 admitting they like when they see ads for products they’ve already searched for.
If you can keep a viewer’s attention, ad effectiveness is the next challenge. A quarter of video streamers say they often buy new products or services they’ve seen in an ad, but this varies across users of each VoD service. There tends to be an inverse relationship between ad reach and ad effectiveness. The top there largest paid streaming services in the US (Netflix, Prime Video, Hulu) have subscribers who are less likely to say they often buy new products or services they’ve seen in an ad. Paid VoD services with smaller subscriber bases, such as Showtime and Discovery+, have subscribers with a higher likelihood of purchasing products they’ve seen in an ad. Advertisers should consider whether they want a larger reach with less ad effectiveness, or a smaller reach with greater ad effectiveness.
Streaming services must also be aware of how ads impact the streaming experience for their customers. Only 1/3 of streamers say they are satisfied with the number of ad breaks across their ad-supported services. Only 1/4 of streamers say they enjoy the ads shown to them. Number of ads, length of ads, and relevance all play a key role in driving satisfaction, engagement, and retention of each service.
Audiences turning to streaming for live sports
As sports rights become more fragmented across the streaming services, streamers are turning to more sports focused providers. DAZN and ESPN+ were two of the fastest growing streaming services in the US in Q2’24, both sports focused services. Across all streaming services, sports drove 10% of new users in the quarter. Kantar has found there is still considerable room for growth driven by sports in streaming. 46% of streamers say they’ve watched a live sport (either through streaming, cable, or linear TV) in the past 3 months, but only 17% of streamers have watched a live sport via a streaming service.
As live sports on streaming grows in popularity and availability, streaming services should look to improving the sports watching experience. Streamers are most satisfied with the variety of sports available on the streaming services where they watch live sports, but there are other areas streaming services can look to improve. For example, across the services where streamers are watching live sports, fewer than 1 in 4 streamers are satisfied with on screen statistics, interactive features, and co-watching. By building upon the live sports offered on streaming, streaming services can create an engaging experience for their audience.
Hannah Avery, Consumer Insights Director, Worldpanel Division, Kantar, said:
“The streaming experience has expanded beyond viewing original content. Ads are playing an increasingly important role in the overall streaming experience, and streamers are looking beyond original titles to live content, such as sports. Streaming services now have the challenge of considering how all these factors impact the overall experience for their audience.”
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