In a major shakeup to its advertising strategy, Netflix announced the development of its very own advertising technology platform during its Upfronts presentation.
This move, coming just 18 months after entering the ad space, pits the streaming giant directly against established industry leaders like Google, Amazon, and Comcast who all possess powerful ad servers.
Previously, Netflix relied on Microsoft to develop its ad tech infrastructure, allowing it to quickly enter the ad market and catch up with competitors like Hulu, which has boasted its own ad server for over a decade.
However, with the in-house platform, Netflix takes the reins of its advertising future.
This strategic shift empowers Netflix to craft highly targeted and personalized ad experiences for its massive user base – a staggering 270 million subscribers.
“By bringing our ad tech in-house,”
explained Amy Reinhard, Netflix’s president of advertising,
“we can deliver the ad plan with the same level of excellence that has made Netflix the leader in streaming technology today. We’re incredibly thoughtful about ad presentation because we prioritize a phenomenal member experience. Extensive consumer research ensures we stay ahead of the curve, creating opportunities that benefit both our members and brands.”
While specifics about how the in-house solution will revolutionize ad delivery remain under wraps, reports suggest a shift away from generic ads.
According to the Financial Times, Netflix aims to experiment with “episodic” campaigns – a series of interconnected ads that tell a story, replacing repetitive and intrusive ad formats.
The Upfronts presentation also saw Netflix unveil expanded buying capabilities this summer.
The Trade Desk, Google’s Display & Video 360, and Magnite join Microsoft as programmatic partners, a move mirroring competitor Disney+’s advertising agreement with The Trade Desk.
Further emphasizing the success of its ad-supported tier, Netflix boasted 40 million global monthly active users opting for the plan, a significant jump from the 5 million users it garnered within just six months of launch.
