Netflix strikes measurement deals ahead of new ad-supported tier

Netflix has recognized the need for independent measurement when it starts running ads in the coming months, and it will work with Integral Ad Science and DoubleVerify as its first partners, according to people familiar with the arrangement. Netflix picked those two third-party firms in order to give advertisers assurances that ads will run where they are supposed to and to confirm ads are viewed according to industry standards, these people said. Integral Ad Science and DoubleVerify are two viewability firms that are part of a growing class of measurement providers that advertisers use to analyze digital ads on the web and connected TVs. Netflix is developing its first ad-supported tier, which is expected to start serving ads in the coming weeks, offering a lower subscription fee to viewers who opt into ads. The ad industry is watching Netflix closely to see how it develops its first advertising products. Brands are trying to understand how the streaming giant will compete with Amazon, Disney+, NBCUniversal’s Peacock, Roku and other major channels, which all have a head start in ad tech capabilities. Meanwhile, Netflix has been asking for high prices for its ad inventory, at least $60 CPMs—cost per thousand views—while only offering limited targeting possibilities and no third-party measurement, according to people familiar with the situation. Ad Age Next: Streaming Get your tickets for the Nov. 10 event in New York and use the code AA50 for $50 off Register here Advertisers have been concerned about that lack of independent measurement, and DoubleVerify and Integral Ad Science could fill in some blind spots, advertisers said. A measurement exec, speaking on condition of anonymity, said that it would be simple enough for Netflix to implement DoubleVerify and Integral Ad Science. "I'd imagine Netflix is receiving pressure to start to build out third-party ecosystem," the measurement exec said, "and viewability is an incredibly low-lift way for them to check a box without disrupting product and tech flow." The two companies are mostly used by brands to measure viewability, but not necessarily outcomes of ad campaigns, such as tracking when ads generate sales. For instance, DoubleVerify and IAS can relay to a brand that commercials appeared on the screen and how often, and they offer insights into whether the content on the screen matched brand suitability standards. They also vet ad campaigns for fraudulent activity, which has been a problem on connected TVs. Related: Why Netflix chose Microsoft as its ad partner “You can’t launch an AVOD [ad-supported video on demand] platform without measurement,” said Jo Kinsella, president of InnovidXP, a part of the connected TV ad serving platform Innovid. “What’s really needed is you have to be able to prove the incrementality of a streaming platform over linear TV, because streaming platforms are expensive.” Netflix is just starting its ad platform and has yet to announce official partners, but advertisers confirmed that DoubleVerify and Integral Ad Science were on board for viewability. There is still more sophisticated measurement that advertisers will undoubtedly demand if Netflix hopes to compete with the likes of Disney+ or NBCUniversal. The industry is watching how Netflix works with advertising technology and measurement partners because it is expected to be such an influential participant in connected TV. The standards that Netflix sets could shape the rest of the field. One person familiar with Netflix’s ad deals said that DoubleVerify and Integral Ad Science would work with Netflix ad inventory starting in January. DoubleVerify and Integral Ad Science declined to comment for this story. Netflix was not immediately available for comment. In July, Netflix picked Microsoft as its exclusive ad partner to help launch its platform. In August, Netflix also beefed up its internal ad sales team by hiring Jeremi Gorman and Peter Naylor, both from Snap. The duo were viewed as key hires that could help Netflix figure out what advertisers will need from a new ad-supported service and how to sell that to the brands.

Netflix strikes measurement deals ahead of new ad-supported tier

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