Disney+'s New Advertising Strategies

The launch of the online streaming service Disney+ has brought in many new consumers for the Disney franchise. As of right now, Disney Plus offers only an ad-free streaming for $8 a month. Disney+ wants to take their services into a new direction by offering a cheaper streaming option that includes ads. According to Brooke Barnes, an author of The New York Times, the Walt Disney Company has decided to go in this direction because they want to keep up with the growing advertising market, which would ultimately bring in more revenue to their business. In the article “Disney+ Will Introduce a Cheaper, Ad-Supported Version This Year”, it is mentioned that the ad-free subscription of Disney+ would be very similar to other streaming services such as “HBO Max and Paramount ''. Although this new subscription option has many positives for both the Walt Disney Company and its consumers, it also runs the risk of hurting the company’s original cable network. By including an option with advertisements, the Disney+ app then closely mirrors Disney Channel. Disney Channel has been around for years, but watchers have always had to wait for their favorite shows to be streaming at specific times. Disney removes this aspect from viewers’ lives because all Disney shows and episodes are available to watch at any time. As a result, if more people purchase Disney+ under the cheaper subscription option that includes ads, then people will be less likely to use Disney Channel. Additionally, Disney+ gives people the opportunity to have an “on the go” watching option. Therefore, it is easier to watch shows through the app because it is more accessible wherever you go. Ever since Disney+ revealed that they were going to include advertisements, many companies have been reaching out to them for more business opportunities. This would be a great way for Disney to expand their entertainment platform, but it also puts them into competition with other advertisement-driven streaming services. With a continuously growing marketplace for streaming, Disney+ does gain the chance to enter into this realm. Another point that Barnes emphasizes is that the Disney franchise is predominantly focused on a child-based audience. Unlike other streaming services, Disney+ will have to be very careful in the choosing of the advertisements that they include in their ad-supported version. This is also because “Disney Channel, the company’s flagship cable network, marketed itself to parents as a safe space”(Barnes) for their children to be able to watch age-appropriate tv shows and advertisements that played during commercials. The main goal of this ad-supported subscription option is for Disney+ to capture a larger audience by making it more affordable. The company wants to expand the number of their subscribers drastically and they believe that this is the best solution for that. It is stated in the article that Disney’s streaming division predicts that “it will be profitable by 2024”(Barnes). Lastly, Barnes demonstrates that Disney+ will make more profits in the future by creating “bundles” consisting of “subscriber fees and advertising sales”(Barnes).

By: Piper Finn '25

Source link: https://www.nytimes.com/2022/03/04/business/disney-plus-ads.html?auth=login-google