Learn to do Digital Advertising on Netflix the right way

Vero Wiedemann16 June

In the digital age, effective advertising is crucial to the success of any business, and you don’t need to be an app marketing agency to know that. Understanding the latest advertising trends is key to maximizing the impact of our clients’ campaigns. One of the most interesting innovations in the advertising world is the recent introduction of Netflix’s advertising plans.

This is a unique opportunity to expand and diversify advertising strategies and reach a large international audience. Today, Netflix is the streaming platform with the largest number of subscribers, and its numbers increase year by year.

Historically, Netflix offered different plans depending on the image quality and the number of users that could share an account, but in November 2022, it launched a new type of subscription that includes ads in exchange for a reduced user price.

This plan is a great opportunity for both viewers and advertisers. For viewers, it saves money on subscriptions, and for advertisers, it provides a new medium to reach a large audience, which inherently has access to a credit card (a key detail when doing digital advertising for apps with monetization goals).

How do Netflix Ads work?

First of all, it is important to note that the only way to access Netflix Ads is through programmatic advertising platforms. Specifically, the Microsoft Invest platform (formerly Xandr) is the only one that allows access to Netflix Ads inventory, so you’ll need a team certified in this technology with proper access and permissions.

Additionally, not all Microsoft Invest accounts are enabled for Netflix advertising, so you must work with a verified advertiser that has a special account with permission in Microsoft Invest to do this.

If you’re reading this article and want to advertise on Netflix, you can learn more about Boomit’s services as a Netflix-authorized company by accessing this landing page and requesting a contact.

What segmentation possibilities does Netflix advertising offer?

Netflix segmentation is partly based on user attributes, such as age and gender. It also allows geolocation targeting to certain countries or cities.

Additionally, the platform’s smart segmentation allows advertisers to differentiate audiences based on their content consumption habits, distinguishing among 10 genres, including comedy, action, romance, and anime. This is especially interesting for brands wanting to associate their content with specific entertainment verticals, avoiding series or movies that don’t fit the style they want to communicate.

Furthermore, there is the option to purchase space in Netflix’s TOP 10, i.e., the ten most-watched movies and series at a given time.

Lastly, the platform allows you to ensure your ad is the first to be seen. This “first impression” segmentation aims to create a greater impact and higher recall levels since users’ receptiveness decreases as they are exposed to more ads.

Within its current model, Netflix advertising only targets one KPI—impressions—since there is no third-party segmentation or first-party retargeting yet. Despite this limitation, there are future plans for deeper advertising segmentation that are being developed.

It’s important to highlight that these impressions are highly valuable, as Netflix content is non-skippable, meaning the user must watch the ad to continue to their selected series or movie.

What do the ads look like on the platform?

A distinctive feature of Netflix advertising is its unique format and how it is presented to the viewer. At the start of any advertising block, users will notice a discreet but clear indicator in the upper right corner of their screen. This indicator informs viewers of the exact number of ads in that particular break, allowing them to adjust their expectations and prepare for the duration of the interruption before returning to their chosen content.

Netflix also offers two distinct ad formats: Pre-roll and Mid-roll.

Pre-roll ads are highly effective, shown right before the user starts watching their selected content. This placement captures the viewer’s full attention before they immerse themselves in their show or movie. Mid-roll ads appear during a break in the middle of the content, similar to traditional TV ad breaks, offering a natural pause in the narrative and a window for advertisers during the viewing experience.

How much time do the ads take?

On average, Netflix has calibrated its ad breaks to ensure an optimal balance between content and advertising. Currently, viewers can expect about 4 minutes of ads per hour of entertainment content. This is a favorable comparison, as exposure to ads on open TV can be up to 7 times longer than on Netflix.

Ad formats on Netflix

Initially, Netflix ads were only available in two standard durations: concise 15-second ads for direct and powerful messages, and longer 30-second ads for more immersive narratives or detailed product descriptions.

However, recognizing the need for greater flexibility in advertising strategies, Netflix has recently expanded its offering. Advertisers can now choose from a wider range of durations, including compact 10-second spots, perfect for quick and memorable impacts; 20-second mid-length spots; and extended 60-second spaces for creative and immersive narratives.

A crucial aspect of Netflix ads is their non-skippable nature. Unlike other streaming platforms or digital video services, Netflix ads cannot be skipped or fast-forwarded. This ensures that each ad is viewed in full, giving advertisers the assurance that their message will be delivered without interruptions.

When should Netflix Ads be included in a digital advertising strategy?

Netflix is currently a platform with low ad saturation, meaning your audience will be more receptive to receiving your advertising message. Given the high penetration of this platform globally, you have a wide potential reach in terms of audiences.

Netflix Ads are a great opportunity to diversify an advertising strategy, especially in cases where brands seek to:

• Build Brand Awareness
• Complement investment in an alternative space to Google, Meta, or TikTok.

Beyond audience size, there are two key points to highlight: first, it’s a highly engaged audience during the viewing experience, implying greater attention to ads; second, knowing that viewers have a credit card to pay for the streaming platform subscription already implies an important level of audience segmentation.

However, this is not the only segmentation available through Netflix Ads. The platform employs what is known as “smart segmentation,” based on users’ interactions and interests within the platform. This means that your ads will be seen in greater proportion by people who are genuinely interested in what you offer.

How to access advertising on Netflix and other streaming platforms?

The only way to access this advertising channel is through programmatic advertising.

Accessing advertising on platforms like Netflix, Pluto TV, Samsung TV, Roku, etc., requires a specialized approach, though it still follows the fundamental principles of any digital advertising campaign. Below is a step-by-step breakdown of the process, specifically focused on campaigns for streaming platforms:

1. Initial briefing: It all starts with a detailed briefing. This is where the campaign objectives, key message, and target audience are identified. This step is crucial to aligning the advertising strategy with the brand’s goals.
2. Media plan: After the briefing, a media plan is developed. This plan should consider the unique features of streaming platforms like Netflix, where programmatic advertising plays a central role. The right platforms are chosen based on the audience and the campaign’s goals. Each platform has its own conditions regarding format, duration, purchase model, and inventory quality.
3. Audience definition: Audiences can be defined based on viewing interests, demographics, behavior on the platform, and other relevant criteria.
4. Format selection: Platforms like Netflix offer various ad formats, including pre-roll and mid-roll ads. The format choice depends on the desired impact and the nature of the ad content. On other platforms like Pluto TV or Samsung TV, there are less invasive and skippable formats available.
5. Investment establishment: The campaign budget is determined. On streaming platforms, this could include purchasing space in the TOP 10 or securing the first ad impression, which can increase the total cost.
6. Content production: The production of ad content must align with the platform’s technical specifications and be attractive enough to capture the viewer’s attention in a competitive environment.
7. Partnering with an authorized partner: To access Netflix advertising, it is essential to work with an authorized partner like Boomit. These partners have exclusive access to programmatic networks and can handle the technical and compliance aspects that are critical for the campaign’s launch.
8. Campaign implementation and launch: Once everything is ready, the campaign is implemented and launched through the chosen platform. This requires careful coordination to ensure that all campaign elements are synchronized and executed as planned.
9. Monitoring and optimization: After the launch, it’s crucial to monitor the campaign’s performance in real-time, making adjustments and optimizations as necessary to maximize RoAS and meet the established goals.

Is it possible to measure the results?

One of the pillars of performance marketing is the ability to measure results and optimize based on them. So, the question arises: how can this be done on a platform whose ads are not clickable?

Although this type of advertising is not as easy to measure as other digital formats, it is possible, especially if the desired conversion is mobile app downloads. How?

On several Connected TV platforms, this can be done through a QR code. Suppose you want to advertise a fintech app to get more downloads. What you should do is create a QR code with a specific UTM to accurately track how many results the campaign generated on this platform.

It is important to note that Netflix currently does not allow the use of QR codes, but their launch is projected for the U.S. market at the beginning of 2024.

So, how are results measured on Netflix Ads?

Although the current landscape presents some challenges, there are key methodologies that allow advertisers to gain a clearer understanding of the impact of their campaigns on these platforms. Certain Mobile Measurement Partners (MMPs), such as Adjust and Appsflyer, have the ability to develop customized solutions for advertisers to track users via their internet IP addresses.

There are two main methodologies used in Connected TV (CTV) measurement: deterministic and probabilistic.

• Deterministic Measurement: This methodology is more precise and is used to attribute Over-The-Top (OTT) app downloads to TV ads on the same platform. The key approaches under deterministic measurement include:
• SDK/S2S Integration: Advertisers can integrate their OTT apps with an MMP to enable holistic attribution of app downloads on the same OTT platform where the CTV ad ran. This integration allows detailed tracking and analysis of OTT installs across different platforms, data standardization, and the configuration of in-app events and customized attribution windows.
• Direct integration with platform providers: This involves a manual feedback process of data from each platform, which can be cumbersome for advertisers using multiple platforms. An MMP simplifies this process by consolidating data from various sources.
• Probabilistic Measurement: Since deterministic methods are not always feasible, especially for attributing CTV ad impacts to other devices, probabilistic methods are used. These include:
• Lift Tests: This approach involves dividing the target audience into test and control groups. The test group sees the actual ads, while the control group views placebo ads. The impact of the ads is analyzed by comparing installation conversion rates between the two groups. However, this method can be costly, as advertisers must pay for ads delivered to both groups.
• Cross-Device Graphs: This comprehensive approach uses data aggregation platforms to link devices within a household based on metrics like IP address, device ID, user agent, and geographic location. The goal is to estimate app installs driven by media across different devices. However, the accuracy of cross-device graphs can vary and often comes with high costs.

Final Thoughts

It is important to recognize that we are witnessing a significant evolution in the digital advertising landscape. With its foray into programmatic advertising, Netflix has opened a new chapter in how brands communicate with their audiences. This platform not only represents an opportunity to reach a global and diverse audience, but it also challenges advertisers to be more creative and strategic in their advertising approach.

The targeting capabilities, along with the non-skippable nature of Netflix ads, offer brands a unique opportunity to effectively capture the viewer’s attention. Moreover, while still developing, the methods for measuring results are advancing toward more precise and detailed approaches, allowing advertisers to better understand the impact of their campaigns.

Looking ahead, we can expect streaming platforms to continue innovating and expanding their advertising capabilities. For brands and advertisers, this means a constant need to adapt and learn, staying up to date with emerging trends and making the most of the unique opportunities the streaming world offers.

In summary, advertising on Netflix and similar platforms is marking the beginning of a new era in digital advertising.