If you’ve just launched your Netflix subscription, you’re likely thinking: “Well, that’s nice, but what about the advertising?”
Well, it’s worth considering the impact of your new subscriptions on the way people see and spend your brand.
Netflix’s latest report on ad effectiveness found that, for every $1 it spent, it made $9.55 in ad revenue.
Netflix also spent $9,500 to promote its latest series, Stranger Things, and $5,200 on advertising in the US.
“If you are a company that is spending $1 million on advertising every month, it can add up to a significant amount of revenue, and that’s what people will think about when they see you,” said Netflix chief marketing officer, John Murphy.
“And they will buy more and more, which is what we’re seeing across our library.”
Netflix is not alone in spending on advertising.
The most recent figures from ad analytics company Kantar Worldpanel, which tracks ad spending on TV and online, suggest that online ad spend has surpassed television as the biggest source of advertising revenue in the UK, US, and Australia.
“For Netflix, the big difference in terms of how we spend is on the digital front,” said Kantar.
“For Netflix it’s mostly in terms, but also in terms on our advertising campaign.”
Netflix says it’s also looking to improve the value of its advertising by offering a wider range of offers to its subscribers.
For instance, if you subscribe to a free 30-day trial, Netflix will deliver you a free season pass and a monthly streaming package that includes the Netflix app.
The subscription service also offers new ad-free features, like a new “Discover Us” section for subscribers to see more content in the app and a redesigned search bar that lets users easily find what they want.
Netflix has also launched a new TV service in Australia, which includes access to the Netflix platform for customers who have an existing Netflix subscription.
“In Australia, the Netflix Prime service is really exciting because there’s no subscription fee, so the whole Netflix experience is free,” said Murphy.
The new service is a great example of Netflix’s growing brand awareness.
The company has also seen an influx of new customers, including Australians who have previously not used Netflix.
“We know we have a huge number of Australians who are new to Netflix,” said Tom Jones, the chief executive of Netflix Australia.
“They’ve been interested in watching shows and movies for a long time.
And so we know we need to continue to build our reach and our reach across our markets.”
For Netflix to keep growing its audience, Netflix needs to attract more viewers in order to sustain its revenue growth.
“It’s very hard for us to keep growth going at a steady pace with so many people on the fence about going to Netflix, especially with the cost of living in Australia,” Jones said.
“That’s the reason we’re offering a new package, a $25 subscription fee.”
Netflix will continue to expand its range of shows and films in Australia as well as in the rest of the world, including in the United States, France, and Germany.
Netflix is still looking to grow its international reach, though, and Jones said Netflix plans to expand the service into more emerging markets.
“I think in the coming years, it is going to be a very, very important part of our business model to be able to offer a global Netflix experience,” Jones told Bloomberg.