Two million subscribers in one and a half year after it has started. 38 million visitors per month. Thereby Hulu Plus, the fee-based platform of the successful American video portal Hulu, is the strongest growing online video-service in the US. As CEO Jason Kilar stated at this year´s AdAge Digital Conference in New York, the platform provides an enormous growth in sales. After achieving a profit of 263 million US$ in 2010, the profit of 2011 amounts up to 420 million US$.
100% completion rate: They only have to pay when the user watches a commercial in full length
Apart from the monthly subscription fee of eight dollars a month, the company, whose proprietors are the media corporates like News Corp., NBC Universal and Disney, counts on advertising money. Kilar presents an interesting new concept to improve the collaboration with the advertisers: advertisers only have to pay for their commercials when a user watches 100% of this commercial. This means: If a user leaves the commercial before it´s finished, the advertiser doesn´t have to pay. This is valid for both services, the free-of-charge service from Hulu and the subscription service from Hulu Plus. This leads to the argument that the concept might not be in the Hulu’s interest, but such doubts are quickly removed, if you consider that according to AdAge 96% of all commercials at Hulu are watched in full length at the moment. This is a pretty high figure. Though the figure for i.e. shorter videoclips is only as high as 59%, this announcement doesn´t mean there is going to be a loss of value.
An interesting concept: Advertisers only have to pay for their commercials on Hulu Plus, if these are watched in full length (100%)
According to Hulu SVP of Advertising, JP Colaco, the new concept is only one of the several initiatives: In 2007, the Hulu Ad Selector was already launched: Customers can choose between several commercials the one they like best. Hulu Ad Swap also offers a lot. Customers have been able to swap commercials with another one since October 2011. This concept seems to be successful: Hulu Ad Swap has been used for more than nine million times.
For Kilar, Hulu´s new initiative is part of the vision that TV-commercials are getting more relevant and more individual for viewers, while it also offers higher attraction for advertisers. It is indeed an exciting field, because with YouTube´s Ad Skipping and Netflix, there is now potent competition in the ring.