When Netflix first launched its ad-supported subscription tier in 2022, it was noted how barebones the offering was. Despite speculation that the streaming giant would rethink the ad model, were it to ever make the move into ads, its initial offering for advertisers was very simple, with little in the way of targeting or advanced measurement.
But as the business has grown, Netflix has been steadily rolling out new features in response to demand from the ad market, through a number of partnerships and the launch of its own in-house advertising technology, which went live last year. A lot of the focus has been on introducing new data capabilities and outcomes-based measurement.
That trend continued yesterday, as Netflix announced several updates to its Ads Suite based around audience targeting and proving outcomes.
Firstly, deeper integrations with two of its DSP partners will add new targeting capabilities. Advertisers buying through Amazon’s DSP will be able to use Amazon Audiences to target their programmatic buys, using segments built on Amazon’s shopping, streaming, and browsing data to find relevant audiences. Similarly, companies using Yahoo DSP will be able to activate Yahoo DSP audience on Netflix buys, bringing Yahoo’s interest, behavioural, purchase and life stage signals to bear on their Netflix campaigns.
These integrations will go live in Q2 this year, starting off in the US before expanding to other markets further down the line.
The streamer also announced it has developed its own Conversion API (CAPI) tools, allowing advertisers to connect up their marketing data (such as conversions or website activity) to Netflix’s ad suite data, helping attribute outcomes to campaigns run on Netflix. The company says it has already run tests with independent agency Tinuiti in the US, and is now expanding the tools more broadly.
While you’ll still hear stories from the buy-side about advertisers pushing spend into Netflix based more on their own view of the service than anything else, Netflix’s moves in the ad space show that to really grow its share of the market, the company needs to be able to clearly demonstrate its ability to deliver on specific outcomes. Reach and proximity to quality content alone are obviously important, since they ultimately help drive the effectiveness of advertising. But having robust tools to give buyers more confidence in their investments, and to target specific audiences where appropriate, is vital in the modern ad market, in Netflix’s eyes at least.
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