In early July, Netflix made a monumental announcement that it will be partnering with Microsoft in order to provide advertisers with the opportunity to promote on the Netflix platform.
The partnership between the two companies will see Netflix launch a new and cheaper subscription tier for its users in order to gain access to their massive library of movies, TV shows and documentaries.
This new cheaper subscription tier will allow brands to launch campaign advertisements across the platform.
Why Did Netflix Choose Microsoft?
But why did Netflix choose Microsoft as its global partner technology and sales partner? According to Netflix COO Greg Peters “Microsoft has the proven ability to support all our advertising needs as we together build a new ad-supported offering. More importantly, Microsoft offered the flexibility to innovate over time on both the technology and sales side, as well as strong privacy protections for our members.”
Microsoft had won the deal to become the official partner of Netflix earlier in the year, edging out other companies such as Google and Comcast. Advertisers will have to book ads directly on the Microsoft Ads platform, the same platform that is used to book ads across platforms such as Bing and DuckDuckGo (If you aren’t already utilizing the Microsoft Ads platform then here are a few good reasons you should).
Netflix first announced its decision to offer a cheaper subscription tier with ads back in April of this year, the decision was not a surprise to many in the industry as other streaming platforms such as Amazon Prime serve ads and others such as Disney+ also plan on launching a cheaper subscription with ads.
What Does the Netflix Partnership With Microsoft Mean For Advertisers?
The partnership between Microsoft and Netflix could potentially change the video advertising landscape, Netflix currently has a membership of around 220 million users that pay for the platform in order to enjoy ad-free entertainment. If we assume that just 10% of those people switch to the new subscription tier along with an influx of new subscribers, the audience would be a minimum of 22 million users ( a very conservtive number). Not only is this a fantastic opportunity for brands to place their ads in front of a new and massive audience but also allows better-than-linear TV brand experience for advertisers.
The teaming up of Netflix and Microsoft is still in early phases as Netflix COO stated “It’s very early days and we have much to work through. But our long-term goal is clear: More choice for consumers and a premium, better-than-linear TV brand experience for advertisers. We’re excited to work with Microsoft as we bring this new service to life.” Despite not having a clear timeline of when we can expect these plans to be rolled out, it’s very exciting for advertisers and brands to have the opportunity to incorporate Netflix into their marketing strategy.
As for us at Optimyzd, we couldn’t be more excited to showcase your brand across Netflix. If you would like to know more about how we can help accelerate your marketing efforts across many platforms such as Google, Youtube, Microsoft and many others then please get in touch with us.