As Hulu continues to rake in unprecedented ad revenues-largely attributed to Super PAC election political campaign spending-a certain tartness to the social chatter about the brand has been visibly expressed in the emotionally charged hashtag #soannoying. Apparently, Hulu viewers are showing signs of overload and ad fatigue.
As one potential Netflix switcher put it: "Is Hulu considering dropping ads for Plus members anytime soon? I would switch from Netflix in a heartbeat if so."
The intrusion of pushed advertising of any sort-albeit Hulu's ad-supported model-is a significant thread throughout the social banter. Viewed as a deterrent to would-be subscribers, the brand's pushed ads factor could impact its long-term growth beyond the 2012 elections.
Hulu's ability to sustain meteoric ad revenue growth post-election has yet to be seen. For the moment, consumer opinion is vacillating, as shown below by the tepid net sentiment in the NetBase Summary.
In monitoring Hulu's social barometer, we noticed that its September push in political ads correlated with a year-to-date net sentiment low of 25% and passion intensity six-month high of 70, as shown in the following NetBase social analytics platform.
Viewer tolerance for the intrusion of advertising in their paid streaming content is being tested. Diminished investor confidence in the ad-supported model, even for such free social media channels as Facebook, is evidenced by the tumbling stock value. And since last year IPO talk for Hulu-owned by News Corp., Walt Disney Co. (DIS) and Providence Equity Partners-has cooled, especially with the dashed expectations of Facebook shareholders, which has further soured investor appetite for social and other Internet properties. A tale of failed great expectations, the value of Netflix stock has plummeted more than 50% in the past year. As the Netflix saga revealed, consumer criteria for brand affinity comes in many hues.
For many subscribers, the attraction of streaming not only lies in the convenience, selection and variety of on-demand. It has deeper emotional roots embedded in a growing desire for control that viewers do not enjoy with cable. Absent that control, ad fatigue can set in, as this post showed: "I also watch a lot of Hulu TV and am getting slammed with national political ads almost every commercial break..."
Even as Hulu offers its current ad selector option throughout the 2012 Presidential campaign race-which enables viewers to choose the ads they watch by such relevant topics as taxes, healthcare, jobs-the social vibe reveals a a sense of fatigue. And an incongruity bordering on intrusion, as this post shows: "I say no every time Hulu asks me 'Is this ad relevant to you?' in hopes that, one day, they'll run out of advertisements to show me."
The social discussion also shows concern over privacy: "My Hulu ads are now all Borderlands and Microsoft. Its like they[Hulu ads] read my blog!" Clearly suffering from ad fatigue syndrome this ad poster wrote: "Seriously over the stupid political ads all over facebook, pandora and hulu. #Geesh." Another viewer is in for a surprise: "I may stop watching tv until the election is over and catch shows on Hulu. These political ads are unreal."
As our Behavior analysis charts below show, although Hulu still enjoys consumer confidence, signs of waning interest could benefit from a social analysis of "why," accompanied by a statistically deliberate viewer engagement strategy.
A sign that the priorities of viewers have shifted-in a market spawned by erstwhile renegade on-demand darling Netflix-is the conspicuous absence of social buzz about the hot topic last year: streaming service subscriber rates. Underestimating the emotional value associated with its brand, subscriber rates coupled with loyalty lead to cries of Netflix's betrayal and foul play, as well as subscriber flight tantamount to insurrection.
The Themes Cloud below profiles a shrewd audience whose criteria now centers on delivery and content in the selection of a streaming platform, and a good starting point for streaming brands to craft a strategy for subscriber engagement.
As the industry matures so do subscribers, who today are more discerning in their streaming options. Market share in the competitive streaming space will benefit from brands that commit to a social engagement strategy that starts with acute social listening, not a brand killing sponsor-fed ad selector.