Netflix now has over 75 million subscribers who are streaming around 125 million hours of content per day. While original content and value certainly play into the platform’s success (not to mention password-sharing abound), perhaps the most significant selling point for Netflix is the lack of commercial interruption. In fact, Netflix saves its viewers around 160 hours of commercials per year, according to a recent calculation by Cord Cutting.
From Nielsen, we know that a typical hour of cable TV includes 15 minutes, 38 seconds – or 938 seconds – of commercials. Multiply that figure by 1.67 repeating and you get 1,563.3 (also repeating) seconds of commercials per day. That’s 570,616.7 seconds per year, which works out to 158.5 hours. So each subscriber saves him or herself about 160 hours of commercials per year by streaming their content through Netflix.
Since the time of radio serials when Little Orphan Annie urged children to drink more Ovaltine, broadcasting has been shaped by its advertisers. While product placement on television and in movies are on the rise, the ability to avoid commercial interruption has become a priority to consumers. In response to this demand, streaming services like Hulu and YouTube are now offering subscription options with little to no advertisements.
So, are commercials a bad word now? Absolutely not, but its increasing lack of popularity is forcing marketers to shape their campaigns in a more interactive or entertaining way. Advertising for digital content is actually growing, as we witnessed at Newfronts last week. According to a report by Interactive Advertising Bureau (IAB), advertisers and media buyers have invested 114 percent more in original digital video programming over the past two years.
Rather than focus on commercial interruption, brands are teaming up to create original content, which creates brand-awareness in a less-intrusive way. But what about TV? Although it can be painful to sit through a three-minute list of horrific side effects for the latest drug, there are many who choose not to pay for ad-free content. This just means that to avoid the mute or fast forward button, those commercial interruptions need to be more effective.
Rather than shove a product into the consumer’s face, brands are now moving toward frontline marketing, which focuses primarily on consumer relationships. As the digital age changes the way we consume entertainment, ad consumption is also affected. Although this poses challenges, it also opens up tremendous opportunities to innovate in how brands connect with their audiences.