How U.S. Consumers Feel About Ads on Streaming Services
A recent study exploring U.S. consumer sentiment of ads on streaming services found that more than half prefer personalized ads and most are willing to accept ads in exchange for lower subscription fees.
The research, "Consumer Perceptions of Ads on Streamers Survey 2024,” was conducted by Moloco, a machine learning-based (ML) advertising solutions provider, and independent research company YouGov. More than 1,000 U.S. consumers were surveyed.
Overall, the results signal a tipping point in consumer consumption habits as they shift from traditional TV to streaming platforms, Moloco determined in a statement on the findings. In October 2023, eMarketer projected that connected TV (CTV) ad spend will reach $30.10 billion in 2024. This shift provides advertisers with a massive opportunity to focus on creating a tighter connection between ads shown and outcomes driven by embracing personalized ads and innovative ad formats.
The study revealed that:
- Consumer behavior is changing as more people move away from traditional TV to use streaming media platforms, particularly on Smart TVs and mobile devices.
- 55% of U.S. consumers said a Smart TV is their most commonly used device for personal streaming, compared with 24% for mobile devices, 13% for laptops/PCs and 7% for tablets.
- 42% of consumers said they are cutting the cord with traditional TV services; an additional 22% are considering it but have yet to do so.
- More than 60% of consumers would choose lower fees in exchange for watching ads.
- Consumers report clear preferences for ad formats that enhance the viewing experience.
- 26% believe ads that are interesting and relevant enhance the viewing experience.
- Pre- and post-roll (i.e., video) ads are ranked most acceptable compared with mid-roll and banner or display ads.
- Banner or display ads and mid-roll ads are perceived as the most intrusive or disruptive.
- Consumers care about the ads experience. They report that ads are influential and that personalized ads are preferable.
- 37% of consumers have canceled a subscription specifically because of the ads experience.
- The majority of consumers prefer personalized ads, with 57% indicating a preference. Of the 57%, 37% prefer personalized ads based on viewing habits alone and 20% prefer personalized ads based on viewing habits and personal data.
- Ads on streaming platforms are influential in the decision-making process for product or service purchases with 45% reporting some level of influence.
Another notable takeaway is paid and free streaming services win over cable TV for viewing the Big Game.
“It’s important to get the ads experience right because consumers will cancel a subscription based on the ads experience,” said Dave Simon, general manager, growth initiatives, Moloco.
“The ads experience is clearly important, especially with consumers not just adjusting to ads on streaming media platforms but embracing ads,” added Vanessa Khoo, senior research manager, YouGov. “In addition, this research showed that consumers find ads compelling and influential in their overall decision-making process for product purchases. This study also showed that personalized ads can actually enhance the overall viewing experience.”
Methodology:
This survey was conducted online in the U.S. by YouGov and focused on consumers who watch video content at least once a month, including streaming content. More than 1,000 consumers participated in the survey from Jan. 19-Feb. 5, 2024.