Stats Show More Than 55% of U.S Adults Use Smartphone For Streaming Videos And That Is Bad News For Advertisers

If we look at the average spending of a U.S. consumer on app subscriptions then according to a recent study done by Adjust, it is $20.78 a month and every person usually has around four subscriptions.

Breaking down the similar data more, provided by the mobile ad company, then consumers in between the age of 25 to 34 are regarded as the biggest spenders with around $25.85 spent every month for app subscriptions. The ones who are aged between 35 to 44 are second in the list with $22.20, 16 to 24 spend around $21.41, 45 to 54 $21.23, and last but not the least, old aged consumers starting from 55 or more also spend $13.97 on average every month.

However, the real surprise begins when 57% of the younger adults who participated in the study admitted that they used smartphones more often to stream their favorite shows or videos during social distancing. There were also a quarter of 17.9% millennials and Generation Z consumers who now prefer to buy their favorite subscription of mobile apps instead of spending it on other services.

Combining all the digits mentioned above, we get an average amount of $33.58 a month that U.S consumers spend on streaming and on-demand entertainment services, with Netflix, Amazon Prime, Hulu, Disney+ and YouTube TV being their top choice. Almost all of these streaming platforms don’t offer the advertising model — except for Hulu, which does allow marketers to reach their subscribers but with a lot of limitations.

On the other hand, there is also AppleTV+ and WarnerMedia's HBO Max on the list which are currently ad-free but as both the platforms are planning to pick up with their revenues selling advertising can be one great option (HBO Max is already planning for it next year).

This current streaming trend among younger adults is bringing mixed advantages for different parts of the mobile industry. But the one that is specifically on the losing end at the moment is brands who want to reach out to the younger audience through these platforms. Users are willing to pay subscriptions also to enjoy an ad-free experience and that is where brands are struggling to find their way out.

For now, there is a relatively small growing audience for advertising on video-on-demand services like NBCUniversal's Peacock, ViacomCBS's Pluto TV, Fox's Tubi, and Fandango's Vudu and fortunately, these are the ones that offer advertisements while being free for viewers. But the way these services are also growing, eventually one can expect them to match the video subscription budgets soon.

So, what will be the future of advertisements on streaming platforms? An answer that is yet to be found out with growing numbers.

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