The TVs from the manufacturer Vizio are priced quite tight for their features, but come with a trade-off: advertising featured on these televisions with personalized advertisements. This strategy already brought them a large amount of income, but now that we know their latest quarterly results we have realized how lucrative this advertising business is for the television manufacturer.
With its Platform + division, which includes revenue from personalized advertising, data collection and subscriptions, Vizio made a profit of $ 57.3 million. The figure alone cannot tell us much, but it supposes more than double the $ 25.6 million it made selling its own televisions.
The lucrative business of personalized ads
Although TV sales revenues are undoubtedly higher, when it comes to profits the overall picture changes. With their 4K TVs, soundbars and devices they have a small profit margin, but with their Platform + it is very different.
Vizio introduce ads on home screens of their operating system, they enter into commercial agreements with streaming platforms to have dedicated physical buttons on the remote control and analyze the viewer data which they then market as part of their InScape program.
Although device sales are down 36% from last year, their Platform + revenue is up 136%. Among the services Vizio offers is SmartCast, with 14 million active users and an income of $ 19.89 per user based on advertising such as the package WatchFreePlus offering free streaming channels with ads.
Vizio is not the only manufacturer that offers advertisements and advertisements on its televisions. In 2018, Xiaomi forced to see advertising by changing the input in the ports of its televisions. It is a extended practice that in the case of Vizio it is shown to what extent it can be important for television manufacturers, as much or more beneficial than the sale of the televisions themselves.
Via | The Verge