The streaming giant’s willingness to cut deals with the likes of Nielsen for its ad-tier launch could pave the way to evolving its business model — and relinquishing more viewership numbers.
And nowhere is Netflix’s adoption of the advertising revenue model more apparent than in its willingness to embrace third-party measurement and verification companies. “Audience measurement is incredibly important to advertisers,” Netflix’s global president of advertising,
In the U.K., Netflix has signed on for the Broadcasters’ Audience Research Board , which will provide a similar service. To be clear, Nielsen will be tracking only Netflix’s ad tier, and only in the U.S. , but it is a significant leap forward for a company that only a year ago launched a website to see what its top 10 TV shows and movies were.
Advertising requires adapting and responding to the needs of others, and third-party verification is just step one. At launch, Netflix will allow only targeting that’s based on geography, or programming genre, though Gorman notes that the company will collect age and gender information from users, which may be used later. “Netflix data will only be used to support advertising on Netflix, and will not be used for targeting or profiles elsewhere,” she noted to reporters.
Netflix transformed how TV was viewed with its advanced streaming tech, enabling “binge viewing” by dropping all episodes at once, and through its powerful recommendation engine. And that history of innovation could lead to similar approaches to advertising. Cohen notes that among the executives hired by Netflix is Peter Naylor, who helped Hulu develop some of its unique ad formats in the mid-2010s .
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