Why Audiences Are Moving to AVOD

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Ad-supported streaming services are seeing adoption at a faster rate than subscription-based ones, according to newly published research from Comscore.

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In a new report, “2022 State of Streaming,” the global media measurement and analytics company charts a 29% increase in US households streaming AVODs in 2022 compared to 2020, versus a 21% increase during the same period for SVODs.

“While both ad-supported and subscription-based streaming services are growing in the US, we’re seeing that consumers are being more mindful of their budgets and leaning towards ad-supported services,” said James Muldrow, VP of product management at Comscore. “This makes sense as inflation continues to hit consumer’s wallets. The time is ripe for traditionally subscription-based streaming services like Netflix to consider launching an ad-supported tier to enhance their growth trajectory.”

Comscore’s analysis also found that American households watched 5.4 streaming services per month as of March 2022, compared to 4.7 in March 2021, as “The Big Five” streaming services became “The Big Six” with the rise of HBO Max. In terms of audience overlap, Netflix has an 82% overlap with the other top six streaming services, especially Amazon (66%) and YouTube (66%).

Diverse audiences (African American, Asian, American Indian and Hispanic populations) are a key driver of streaming growth, the research suggests. In terms of the streaming platforms viewing days per household, African Americans over-index for Amazon, FuboTV, YouTube and Pluto.TV, while Asians over-index for HBO Max, Hulu, YouTube and Sling. Accounting for the largest segment of diverse homes that stream, the Hispanic audience over-indexes for Netflix, YouTube, FuboTV and Sling.

Other findings:

Smart TVs are the fastest-growing segment of streaming devices with 48% growth year-on-year.

Amazon Prime Video has the highest resonance with the younger TikTok, Twitter, Snapchat and Twitch audiences.

Seventy-nine percent of Wi-Fi enabled homes are watching streaming content on Connected TV devices and each such household is spending about 122 hours per month doing so, a 19% growth from March 2021. Netflix captures the most hours per month watched at 43, followed closely by YouTube at 39 hours, and Hulu at 33 hours.