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Netflix is moving forward with plans to develop its own advertising platform and is currently partnering with Google for ad sales and technology.
Rapid growth in Ad-supported tier
Netflix’s ad-supported subscription tier has quickly gained traction, now reaching 40 million monthly users globally, as announced at the Upfront 2024 event.
Significance
The ad-supported model, initially seen as a risky move, has turned into a success for Netflix, which is seeking new revenue streams amid growing competition in the streaming industry.
Why it matters
Netflix provides advertisers with a vast and expanding audience of potential customers. This makes the platform a valuable consideration for those looking to explore new advertising opportunities.
Key news
In just six months, after hitting 5 million ad-supported subscribers following its late 2022 launch, Netflix’s ad-supported user base has surged to 40 million.
Subscriber trends
In regions where the ad-supported tier is available, over 40% of new Netflix subscribers are opting for the more affordable, ad-inclusive plan. The streaming giant now boasts a total of 270 million subscribers across all pricing tiers.
Strategic shifts
Netflix is intensifying its focus on the advertising sector by internalizing its ad tech operations. The company is launching its own advertising platform to match the high standards of its streaming technology, according to Amy Reinhard, Netflix’s President of Advertising. Initially collaborating solely with Microsoft, Netflix is now also working with Google, The Trade Desk, and Magnite for ad sales and technology solutions.
Leadership perspective
“Our ad-supported membership has been incredibly successful,” stated Netflix Co-CEO Ted Sarandos during a presentation. “We are just at the beginning of this journey.”
Conclusion
Netflix’s ability to swiftly scale its advertising business highlights the strength of its brand and content, signaling a reliable new revenue stream as the company continues to expand its presence in the advertising market.
This article available in Ukrainian.
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