Disney+: A win or a loss for advertisers?

This week, Disney+ went live in the US after months of anticipation. Disney built up consumer demand through targeted digital campaigns on social media, banner placements on apps and websites (mobile and desktop) and through their traditional media platforms (ABC, ESPN, Disney Channel, etc). For $6.99 per month, subscribers can watch unlimited Disney content without advertisements. For this reason, I ask the question - is this a win or loss for advertisers?

On one end of the spectrum, Disney+ is building a subscription model similar to that of Netflix and HBO that is absent of ads. Hulu on the other end of the spectrum, also owned by Disney, has a lower monthly fee and is partially subsidized by targeted ads. These non-ad content providers are stealing share of viewing hours, replacing traditional cable viewing, featuring advertisements, with on demand ad free experiences. If advertisers can no longer reach captive viewers while watching shows and movies, are they losing?

I argue this is NOT a loss. As technology has improved, the population's attention span has diminished, reducing the effectiveness of TV advertisements in recent years. Replacing TV ads with targeted mobile, apps, or social media ads has increased the effectiveness and relevancy of ads. While viewers are watching shows, they are more likely than ever to shift their attention to their phone, tablet, or computer where advertisers are ready to feed them incredibly relevant adverts.

Additionally, there are several ways Disney + is actually creating more marketing opportunities. As Disney+ learns about their consumer base, they are able to leverage the learnings to sell their properties through licensing for co-bramded products- for example: cereal, ice cream, snacks, etc... Brands that chose to partner with Disney will have increased demand and awarness for their products.

As millions of viewers flock to sign up for Disney+ all over the world, more targeted digital marketing opportunities will emerge, not fewer. The process of bringing people online to Disney+ will accelerate the transition to a more digitally savvy world, which will open more opportunities.