Netflix estimates that the ad-supported level will reach 40 million viewers by the end of 2023.

Executives from Netflix and its advertising partner,

Microsoft corp.


MSFT 0.09%

have been meeting with ad buyers in recent weeks, seeking to seal deals ahead of a planned launch later this year.

Netflix’s subscriber numbers fell for the first time in nearly a decade, causing its stock to post its worst one-day percentage drop since 2004. The WSJ’s Joe Flint walks us through three strategies the company could try to keep growing, and what the changes could mean for others streamers. CORRECTION: An earlier version of this caption said Netflix’s stock fell to its lowest point since 2004.

In preliminary projections, Netflix told advertising executives it expects 4.4 million unique viewers worldwide at the end of the year, with 1.1 million from the US. The company estimated that it will grow to over 40 million unique viewers by the third quarter of 2023 with 13.3 million from the US

Netflix’s screenings for advertisers covered a dozen launch markets, including Brazil, Mexico, Japan, the UK, France, Germany, Korea, Spain, Italy, Australia and Canada.

The metric the company shared, “projected unique viewers,” is expected to be higher than the number of subscribers for the ad-supported Netflix plan, since more than one person in a subscribing household is likely to watch the service.

“We are still in the early days of deciding how to launch the lower price and ad tier, and no decisions have been made yet,” a Netflix spokeswoman said in a statement.

The streaming company continues to assess potential demand for the ad-supported plan, and its forecasts for subscriptions and viewers could change over time, according to people familiar with the matter.

Netflix, with 220 million subscribers, is betting that a cheaper ad-supported plan could bring in new users and boost revenue as the company faces increased competition and a maturing U.S. market.

The streaming giant lost almost a million subscribers in the June quarter. It joins rivals such as HBO Max and

Disney

+ who have or plan to launch ad-supported services.

Netflix’s advertising spree it’s a major turnaround for a company that has long said it would go ad-free.

Netflix said in a July letter to shareholders that the new ad-supported option would likely begin in early 2023, but told some ad buyers it would launch on Nov. 1. The company strives they charge brands premium prices for advertising on its service, previously reported by The Wall Street Journal.

Viewership projections are distributed to some ad-buying companies so they can advise their advertising clients about the projected reach of a new service — a factor in how much they’ll spend.

Netflix is ​​betting that a cheaper ad-supported plan could bring in new customers for its content, including the survival drama series ‘Squid Game.’


Photography:

Noh Juhan/Associated Press

The initial forecast for unique viewers — about 40 million in about a year — is small compared to Netflix’s massive customer base, but it would put the company on the map as a significant destination for online video ads. The rate of growth of Netflix’s services will depend in part on their price.

Advertisers demand to be part of the launch it is expected to be robust, some ad buyers said. Netflix has been off limits to advertisers for years and has the largest audience in the streaming industry.

Some ad buyers have said they are unhappy with certain aspects of Netflix’s planned service, including that it expects only a limited ability to choose where ads appear.

Netflix also doesn’t initially plan to have an independent company measure or verify that advertisers are getting the exposure they paid for.

Write Suzanne Vranica at the address suzanne.vranica@wsj.com and Sarah Krouse on sarah.krouse+1@wsj.com

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