How Much Are Consumers Willing to Spend on SVOD Services?

January 23, 2020

This article is included in these additional categories:

Advertising Trends | Creative & Formats | Customer-Centric | Digital | Non-mobile Connected Devices | Spending Trends | Video

TheTradeDesk Video Streaming Service Spending Willingness Jan2020About three-quarters (74%) of US households now have at least one subscription streaming video service. As services like Netflix and Amazon Prime continue to see their subscription numbers grow, is there a limit to how much people are willing to pay for such services? Here’s what a recent survey [download page] from The Trade Desk and YouGov discovered.

Clearly there’s room for at least a couple of leading services: more than 6 in 10 of the 2,600+ US consumers surveyed say they are willing to pay at least $10 to $20 per month for streaming services, though fewer than half would pay at least $20 per month.

Excluding those who don’t want to pay anything for streaming services, the results indicate that more than half (~53%) would spend upwards of $20-30 per month. But respondents clearly don’t want to spend as much as they might be forking out on pay-TV services; three-quarters overall capped out their maximum willing spend at $30, including about two-thirds of those willing to spend on streaming services.

Despite the popularity of streaming services and a trend towards cutting the cord, roughly one-quarter (24%) of respondents report that they are not willing to spend any amount of money on TV streaming service subscriptions. That said, 34% of the consumers surveyed say they prefer to watch a free service funded by advertising or pay a reduced price for subscriptions that include some advertisements. These findings are supported by earlier data from TDG which found that, in the specific case of Netflix subscribers, about one-third would likely switch to an ad-supported Netflix tier if it were offered.

As reported by Marketing Dive, 46% of consumers say the most frustrating part of ads on streaming services is seeing the same ad over and over. However, a majority (68%) of consumers are willing to watch relevant ads if it means watching fewer ads. But what does “relevance” mean in the context of video? An IAB report revealed that when it comes to ad relevance in streaming video, in general, some 56% of video streamers prefer to see ads that are relevant to what they are watching as opposed to those relevant to their browsing behavior or their particular demographic.

To read more, the full report can be downloaded here.

About the Data: Results are based on a survey of 2,613 US consumers.

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