Amazon plans to increase advertising on its Prime Video streaming platform next year. After introducing a limited number of ads in early 2024 (with an additional subscription to remove them), the e-commerce giant found that this did not massively drive away subscribers. Based on this observation, Amazon now intends to go further.
A “very light advertising load” well tolerated according to Amazon
When Amazon launched ads on Prime Video last January, the group opted for a cautious approach. Only a “very light advertising load” was initially put in place, of the order of 2 to 3.5 minutes of advertising per hour on average according to the Wall Street Journal.
Kelly Day, vice president of Prime Video International, told the Financial Times that this “smooth entry into advertising has exceeded customer expectations in terms of the advertising experience.” As a result, the churn rate “was much lower than we anticipated,” she says.
Heading for more ads in 2025
Reassured by this tolerance from subscribers, Amazon decided to move up a gear. The number of advertising spaces offered to advertisers on Prime Video will thus increase “a little more in 2025”, confirmed Kelly Day. Concretely, viewers will have to expect more ad breaks before and during their programs.
Prime Video does not currently interrupt content to serve ads. But that could change next year. The service also provides for the arrival of interactive advertisements, allowing you to find out more about a product or a brand, or even add it directly to your Amazon basket.
Advertising, a growth lever for streaming services
Amazon is not the only one to rely on advertising to boost its revenues. Netflix, Disney+ and HBO Max have also launched cheaper subscriptions, partly financed by advertisements. A paid strategy, offers with advertising attracting many new subscribers, particularly at Netflix.
Streaming services seek the right balance between advertising revenue and user experience. If Amazon increases the pressure, it is because it thinks that subscribers are ready to accept more. Prime Video being still included in the Amazon Prime subscription, the offer still remains very advantageous and this can explain why users are little bothered by advertising at the moment. But be careful not to exceed their tolerance threshold, at the risk this time of seeing them leave. The challenge is significant for Prime Video and its competitors.