Streaming Platforms Experience Strong Advertising Growth
The advertising market in streaming platforms is witnessing a significant surge. Four of the fastest-growing platforms, Amazon Prime Video, Netflix, Disney+, and Peacock, contributed almost 50% of annual advertising revenue growth, reaching $3.8 billion in the third quarter of 2024.
Revenue Growth Across Platforms
According to an analysis by MoffettNathanson, the advertising revenue gap reached $3.8 billion, an increase of 50% over the previous year. Excluding Peacock’s Olympic-related results, the increase is 36%, with revenue estimated at $3.5 billion.
Hulu had the highest revenue, reaching $782 million, an increase of 5%. Peacock follows closely, with $761 million and a spectacular 114% increase. Amazon Prime Video reached revenues of $441 million, an increase of 230%, while Netflix generated $429 million, a growth of 95%. Disney+ is also among the three fastest-growing platforms, with an increase of 180% to reach $141 million.
Forecasts for 2024
Forecasts for 2024 indicate that Disney+ will see the biggest growth with a predicted increase of 261%, reaching $531 million in advertising revenue. Amazon Prime Video is expected to see a 133% increase to $2 billion, while Netflix is expected to grow 116% to $1.6 billion. In total, advertising video on demand (AVOD) platform revenue for the top 11 streamers is expected to increase 39%, reaching $14.3 billion.
Main Recipients of Advertising Revenue
For next year, the main recipients of advertising revenue will include Hulu with $3.1 billion; followed by Peacock with $2.1 billion; Prime Video with $2 billion; Netflix with $1.6 billion; Roku Channel ($1.2 billion) and Pluto ($1 billion).
CTV Advertising Investment Trends to Watch in 2025
By 2026, nine streaming services will generate more than $1 billion in advertising revenue, up from just two in 2020, according to EMARKETER forecasts. To generate that revenue, players in the connected television (CTV) space are seeking more advertising investment, which will have a significant effect on marketing budgets and consumer experiences.
When Amazon Prime Video automatically enrolled users in a new ad tier earlier this year, ad supply in the streaming space skyrocketed, which in turn caused its costs to plummet. Netflix and Max will be the only streaming services that will have an average cost per thousand (CPM) greater than $30 in the second quarter of 2025, according to the forecast.
CTV Ad Spend Trends to Watch in 2025
Some of the CTV ad spend trends to watch in 2025 include:
* CTV’s audience is growing faster than its ad spend: By 2026, CTV will account for 20% of the time adults spend with media daily in the US, up from 11.5% in 2020, but it will still only get 8.1% of the total advertising investment.
* Linear TV still accounts for nearly six times more ad impressions than CTV, making it the right channel for top-of-funnel messaging.
* CTV targeting encourages broader ad spend – 65% of marketers classify CTV as a performance channel, and 52% use it to drive key metrics like web visits and revenue.
* Partnerships between streamers and Retail Media Networks (RMN) have created more targeted advertising experiences, and AI is driving its potential through automated media buying and optimization.