Healthy and General

Netflix to Add Ads. Why This Could Be a ‘Game-Changer’ for

3 min read

Q. How does Netflix compare with its audience tracking strategies?

A. Netflix is remarkably data driven. They want to learn as much as they can. It’s an analytics company that wants to get it right and if you’re working with an advertiser, you can begin to set up when audiences are most prime or most open to advertisements and which advertisers might work best in which genre or which show.

Netflix has so much historical information that, once it begins to offer advertisements, it will be primed to track how audiences consume advertisements. Because it’s digital, right? When did people pause during this advertisement? What did they watch after? Did this advertisement force them to leave the show? Where did they land before watching this advertisement?

Netflix is able to measure literally every button you click. They can figure out how many times you searched for “Stranger Things” or whatever it is, because they track everything. There’s tons of that they can do. They can put advertisements in between the kiosks. Why not? The sky is the limit with a company like that. And frankly, advertising needs a refresher. We’ve been airing the same types of TV advertisements that we’ve been doing since the ’50s.

Q. What are some examples of branding within shows?

A. Subway, for instance, has created an entire Korean drama around the Subway shop. So, there is room, I think, for more captivating advertisements, which isn’t a bad thing. Most ads are forgettable and not interesting. If you’re working with a streaming service, it gives you creative space. You can curse, you can have more adult content and, frankly, you can probably reinvigorate your brand and give it an edge. Maybe make it sophisticated, right?

“Mad Men” wrapped up with Don Draper dreaming up the, “I want to buy the world a Coke” campaign. That was huge! What a great boon for Coca-Cola! It didn’t feel like an advertisement. It was an amazing plot point to an epic series. I can remember that more so than all the other Coca-Cola commercials I’ve seen.

Q. Before all of this, Netflix has been in the news for its plummeting stock. Are you sold on its future?

A. Full disclosure: I invested a notable amount of money into Netflix after its stock plummeted in the stock market. I believe very much in Netflix and I want to be upfront and genuine to your readers.

There are two reasons why I’m very interested in Netflix. One is the gaming channel that is coming. None of Netflix’s direct competitors directly offer gaming, as they often license content to outside video game studios. Additionally, this is interesting because it may or may not have advertising. We know that gamers are constantly exposed to product placement because you really can’t put an advertisement in the middle of “Call of Duty,” but you can have a crushed soda can by a soldier’s foot that has Coca-Cola on it. Adver-gaming and other types of immersive, Web3-based advertisements (e.g. Metaverse, NFTs) become possible on a digital streaming service.

The other reason I’m interested in Netflix is the ad-tiered supportive service. Having an ad-supported tier that’s available to audiences is remarkably key in them buoying their cash flows and financial statements and preserving their realization of being in the black. Because for so long, Netflix had been spending at an alarming clip. I believe every time they raised their subscription price by a $1, it was another billion dollars spent on content. They were not cheap by any stretch of the imagination. Therefore, by offering an ad-supported tier, I think this will restore investor confidence in Netflix.