Netflix yesterday announced substantial improvements to its advertising capabilities and reported a significant increase in upfront ad sales commitments. Amy Reinhard, President of Advertising at Netflix, revealed that the company has closed deals with all major holding companies and independent agencies, resulting in a more than 150% increase in upfront ad sales commitments compared to 2023. This announcement comes as Netflix continues to expand its advertising business, which was launched in late 2022 as a new revenue stream for the company.
According to Reinhard, the upfront commitments span across key advertising categories, including Consumer Packaged Goods (CPG), Technology and Entertainment, Automotive, Quick Service Restaurants (QSR), and Retail. This diverse range of advertisers demonstrates the broad appeal of Netflix's platform to marketers across various industries. The company has secured partnerships for several of its upcoming high-profile releases, including new seasons of popular series such as "Squid Game," "Wednesday," and "Outer Banks," as well as anticipated films like "Happy Gilmore 2."
In addition to scripted content, Netflix has also highlighted its ability to attract advertisers for live events. The company mentioned securing deals around upcoming WWE Raw broadcasts and Christmas Day NFL games, signaling its expansion into live sports and entertainment programming. This move into live content represents a significant shift for Netflix, which has historically focused primarily on on-demand streaming.
One of the most notable aspects of Netflix's advertising growth is its success in attracting international brand partnerships. For the third season of "Bridgerton," which Netflix reports as its sixth most popular English-language TV series of all time, the company has secured multiple international on-screen title sponsors. These sponsors include well-known brands such as Pure Leaf, Amazon Audible, Puig, Booking.com, Stella Artois, and Hilton. Similarly, for the return of "Emily in Paris," Netflix has partnered with luxury brands like LVMH and COTY Gucci, as well as tech giants Google and Rakuten.
The announcement also detailed several technical enhancements to Netflix's advertising platform. The company is set to launch its in-house ad tech platform, which will be tested in Canada in November 2024 before a global rollout in 2025. This move towards in-house ad technology suggests Netflix's commitment to developing a robust, proprietary advertising infrastructure.
In terms of buying capabilities, Netflix has expanded its options for advertisers. Marketers can now set up private one-to-one marketplace deals directly with Netflix through various demand-side platforms (DSPs) including The Trade Desk, Google's Display & Video 360, and Xandr. The company plans to extend these capabilities to include programmatic guarantee buying in November 2024. These enhancements provide advertisers with more flexibility and control over their ad placements on the Netflix platform.
Netflix has also introduced new partnerships for ad verification and measurement. The company now supports impression verification through Google's Campaign Manager 360 and Innovid, while extending its existing relationships with DoubleVerify and Integral Ad Science for fraud and viewability verification in programmatic channels. These solutions will be available across all buying channels starting in October 2024, offering advertisers greater transparency and confidence in their ad placements.
The streaming service has already begun executing programmatic campaigns with major advertisers such as Expedia, Ford, T-Mobile, Mercedes-Benz, Novartis, and American Eagle. Currently, programmatic private marketplace buys are available in the United States, Canada, Brazil, and Mexico, with plans to expand globally in the coming months.
In a move to enhance its measurement capabilities, Netflix announced several new partnerships set to launch in the fall of 2024. The company will extend its campaign performance measurement suite into various third-party measurement platforms, including NielsenOne, Lucid (or Cint), EDO Inc., NCSolutions, Kantar, and Affinity Solutions. These integrations will be available for all ad buy types, providing advertisers with comprehensive insights into their campaign performance across the Netflix platform.
Furthermore, Netflix is addressing data privacy concerns by partnering with clean room suppliers Snowflake, InfoSum, and LiveRamp. These partnerships aim to create a secure and privacy-safe environment for both Netflix members and advertisers. The clean room technology will allow advertisers to determine audience overlap, post-campaign reach and frequency, and last-touch attribution in a secure environment. Snowflake Data Clean Rooms are already available to partners, with InfoSum and LiveRamp solutions set to launch in the coming months.
In the United Kingdom, Netflix is taking steps to integrate its ad-supported plan into established industry measurement systems. Starting in September 2024, the Netflix ad-supported plan will be available in Barb's Advance Campaign Hub (ACH), making it easier for UK advertisers to plan their campaigns using industry-standard metrics.
The rapid expansion of Netflix's advertising capabilities comes as the streaming market becomes increasingly competitive and saturated. By diversifying its revenue streams and offering advertisers access to its large and engaged audience, Netflix is positioning itself to maintain its leading position in the streaming industry while opening up new growth opportunities.
Key facts from Netflix's advertising announcement
- Upfront ad sales commitments increased by over 150% compared to 2023
- Deals closed with all major holding companies and independent agencies
- Partnerships secured for upcoming high-profile series and films
- International on-screen title sponsors acquired for "Bridgerton" Season 3
- In-house ad tech platform to be tested in Canada in November 2024, global launch in 2025
- Private one-to-one marketplace deals now available through various DSPs
- Programmatic campaigns executed with major advertisers in select markets
- New partnerships for ad verification and measurement to launch in October 2024
- Campaign performance measurement suite to be extended to multiple third-party platforms
- Clean room partnerships established with Snowflake, InfoSum, and LiveRamp
- Netflix ad-supported plan to be included in UK's Barb's Advance Campaign Hub in September 2024