Hey, Netflix, where’s the non-ads primary tier option gone?
Despite suggesting it never would, Netflix is pushing customers towards signing up for its ads-free basic tier. As calculated by streaming industry insider Andrew Freedman and first reported by Cord Busters, Netflix encourages potential subscribers to sign up for its advertisements-supported basic tier rather than its good basic tier.
Earlier, customers who navigated to Netflix’s sign-up page were greeted with four tiers to select from basic with adverts, standard, essential, and premium. The latter three are not supported by advertisements, meaning consumers won’t have to sit through 5 minutes of adverts for every single hour of Netflix information they stream.
However, those looking to buy a subscription are only given three tiers to select from, with the monthly pack cost of $9.99 / £6.99 / ₹199 / AU$10.99 core tier nowhere to be seen.
Or so it seems. Netflix’s basic tier is now available to purchase – you must do a little digging to search for it. Specifically, you’ll be required to scroll down until you view some small print that reads, ‘Want more choices? See all plans. Tap on the linked text, and you’ll be taken to a near-identical login page, which is the advertisement-free core tier. This tier is slightly more expensive than the advertisement-supported option. Still, you won’t have to sit through commercials; you can also download your favorite Netflix shows, movies, and documentaries to your device. This tier permits you to watch Netflix information offline, too.
So, what’s the big deal? Netflix’s basic tiers only provide 720pixel resolution, so most consumers will opt for the standard or premium tiers, which allow you better video resolution, a higher resolution, and other bonuses, correct?
Not surely. The current price of living crisis means viewers must make big decisions about how they spend their money. That includes which streaming subscriptions – Television and movie or music streamers platforms like Spotify – are likely to take or cancel.
With people having to make their money stretch further – or, in some cases, even struggling to spend for their bills – a cheap, albeit advertisements-supported subscription to the world’s best streaming service will surely appeal to some. Netflix, then, might think it’s acting in viewers’ better interests by putting its cheapest subscription tier front and center. As we mentioned, the company’s non-advertisements introductory tier price is more than its advertisements for free cousins, so why wouldn’t Netflix push this one during economic unpredictability?
However, the problem lies in how Netflix promotes its ads-free basic tier. By actively hiding its non-ads basic level, Netflix is reducing consumer choice on its sign-up page. That could be considered poor customer service, as it deprives potential subscribers of every option available.
It’s a move that flies in the face of what Netflix’s executive team told its stakeholders. In Netflix’s Q3 2022 earnings call, Greg Peters, Chief Operating and Chief Product Officer of Netflix declared the streaming giant would take a “pro-viewers approach” per financial advice expert The Motley Fool to provide consumers with its subscription options.
“As we stated before, we’re not trying to steer our consumers to one plan or another,” Peters said. “We’re trying to take a pro-viewers approach and let them search and land on the right plan for them… And so, we anticipate this will be a pro-viewers model that will be extra attractive, bringing numbers of new members in because the consumer pricing price is merger.”
Peters made those statements after Netflix posted a net hike of 2.4 million subscribers in Q3 2022, after successive financial quarters where the company lost millions of customers and subsequently canceled multiple in-development shows. At the time, then, it seemed Netflix was encouraged by its subscriber-based u-turn and desire to maintain that positivity by telling shareholders what they required to hear.
And yet here we are, four months after that call, with Netflix buying one of its subscription tiers in the tiny print of its login page. So what switched? The popularity or, rather, the unpopularity of Netflix’s ads-based basic tier.
As we announced in January, an inspection conducted by testing firm Antenna suggested uptake on Netflix’s ads-supported tier had been slow – especially so, with just 9 percent of the latest US subscribers logging in to this particular plan in the four months since they announced.
Despite the sluggish beginning, Netflix President of Worldwide Advertising Jeremi Gorman recommended the company was “pleased with the growth we’re seeing” and that they predict further uptake in the coming months as the advertisement-supported tier is rolled out in other world regions.