Consumers welcome ads when it saves them money. What does that mean for marketers?

Two-thirds of US TV viewers (66%) would rather watch ads and save $4 to $5 a month than spend the money to ditch ads, according to June 2024 data from Hub Research. That’s up five percentage points from June 2023. Netflix, Amazon Prime Video, Hulu, and Max all have ad-supported tiers now, and consumers benefit by saving a few dollars along the way. Advertisers can capitalize on these cost-saving behaviors by reaching consumers with messaging that emphasizes discounts and deals.

Consumers are increasingly comfortable with ads on streaming platforms. Just 13% disapproved of the format in 2023, down from 36% in 2022, according to Disqo. Attitudes have shifted as ads have become more common on platforms like Amazon Prime Video and Netflix.

• 74.8% of US OTT video service users will watch ad-supported video-on-demand (AVOD) in 2025, per our October 2024 forecast. That’s up from 47.3% in 2020.
• When Amazon Prime Video defaulted all users into its ad-supported tier at the start of 2024, ads became a regular part of the streaming experience for the 80.0% of its US users that did not opt to pay more for ad-free.

While the new ad-supported normal may irritate viewers, many won’t pay more to avoid it. Consumers are focused on saving money, and embracing ads on streaming platforms is one way to do that without sacrificing entertainment.

As consumers embrace ad-supported video, they’re ditching ad-free. Just 58% of respondents to a Hub Research survey used ad-free TV services in June 2024, down from 84% the previous year. Amazon Prime Video was the last ad-free service for many households, and its introduction of ads in 2024 led to a major drop-off in ad-free platform usage.

Advertisers should meet these consumers where they are—on AVOD and free ad-supported TV (FAST). Because consumers are cost-conscious right now, advertisers on these platforms should push deals and discounts. Streaming platforms can also capitalize on this cost-cutting behavior by improving their targeting capabilities, so advertisers are pushing deals to the correct consumers.

This was originally featured in the EMARKETER Daily newsletter. For more marketing insights, statistics, and trends, subscribe here.