Hulu today made a number of announcements including an expansion to its more creative take on delivering ads.
Specifically, Hulu is looking to next target binge-watchers. The details on this are still fairly vague with the company explaining it plans to launch a new "binge advertising experience."
One that's both "creative" and "situationally relevant."
Binge-watchers are famed for their longer and more intensive single-sitting approach to video consumption, and reading between the lines Hulu plans to launch a new advertising model that will better serve (from the marketer perspective) ads to those users in a way that's different to viewers who simply sit down to watch an episode or two.
One of the issues with binge-watching via certain streaming services is the repetitiveness of the ads seen. This is particularly true when ads are even more highly targeted as the pool of ads to draw from is smaller than those aimed at larger demographics.
The situational relevance reference might be suggesting this will change in the future, while the creative aspect could be interpreted in different ways. For one thing the repetitiveness of brand advertising could see binge ads being told in more of a continuation format where one ad for the same brand leads on from the previous one in an almost storytelling-like fashion – instead of simply replaying the same ad again and again.
Alternatively, it could be the case there are some user incentives bundled into the ad experience to help increase attention and engagement. This sort of action is already in use to some degree with viewers able to choose between ad options, instead of being force-fed an ad predicted to be relevant to the viewer.
Earlier in the year Hulu announced the launch of a new 'pause ad' program where advertising is displayed when a user actively pauses content. This was only in a limited rollout status but along with today's announcement Hulu confirmed it is expanding the pause ad program starting in August.
The key element that both of these formats (binge and pause) have in common is the emphasis on being non-intrusive by adding some element of control over the ad-viewing experience to the viewer.
Ads are essential to Hulu as it looks to further cement its position in the market. Unlike Netflix, Hulu has taken a price-conscious approach to the market and so far this year has bucked the trend of raising prices. In contrast to many other streaming services, Hulu lowered pricing for the ad-supported version of its on-demand catalog service plan down to $5.99 per month.
Utilizing new advertising measures is key to this approach as it looks to offset the loss in direct consumer revenue by increased advertising revenue. Therefore finding new ways that offer better ad retention and penetration is vital to maintaining higher advertiser interest.
Overall it would seem as though this approach is working as Hulu also confirmed today that it now enjoys 28 million subscribers.
26.8 million of them are active paid subscribers, while the remaining 1.3 million are still in a promotional stage.
This number might be far less than Netflix, but it is a number that's rising and considering Hulu is an ad-based business, that's good news for both Hulu and advertisers alike.