The Netflix password crackdown is here

The crackdown begins

This week, we saw the first reports of Netflix cracking down on password sharing as friends across the country got the message they knew would always come, but were never prepared for. Netflix has introduced its long apprehended password crackdown in several markets, including the UK. 

What changed? 

The brand that famously said “love is sharing a password” have reacted to increased competition and declining subscriber numbers – users can no longer share accounts outside their households

The expectation is that subscriptions initially drop off as a result, but then grow over the long term, eventually surpassing the current numbers. This is what happened In Canada where Netflix initially rolled out the approach in Q1 this year (2023) and saw an initial drop in subscribers. However, paid subscribers are actually now above where they were before the changes.

What is the opportunity for brands?

Since the move, there’s been a notable marketing push from Netflix promoting across digital, social, bus sides and TV, all leading with the “plans start at £4.99 a month” message. 

This is a clear focus from Netflix to highlight pricing as well as their content offering, with the cost being called out throughout the ad creative. The move showcases the affordability element as Netflix seek to fuel new subscribers from the expected drop and grow scale for advertisers.

A slow start, but we’re getting there

Netflix introduced basic tier with ads as a lower entry point for subscribers and a way to make additional revenue from advertising. 

The Netflix AVOD volume in the UK was initially low, which translates into primitive targeting capabilities and some hefty price increases for layering on targeting. 

Targeting capabilities have gradually improved as scale increases with the ability to add geotargeting on top of demographic and content targeting too.

How we can help you? 

Netflix inventory presents a huge opportunity for advertisers to reach audiences with full-screen, high-resolution creatives and it also has the ability to showcase ads in 4k.

On top of a high attention and creatively rich environment, Netflix also presents plenty of benefits for advertisers: 

• New targeting can help extend or amplify TV campaigns
• It’s a brand safe environment (with strict controls if necessary) and low ad load
• The audience is typically engaged having just chosen the content they are viewing
• You can access hard-to-reach audiences who often don’t consume commercial TV- particularly 18-35s 
• You’re ahead of the curve. There is still a relatively small number of brands advertising on the platform – an opportunity to be seen early on the platform and get strong SOV
• More of the key players such as Disney and AppleTV+ will be heading into this space (and already are in certain markets)

If you’re interested in advertising on Netflix or a wider CTV strategy, please get in touch.