Netflix just pulled a coup on Snap, taking two of its most high-profile ad executives to grow its streaming video ad business while leaving Snap rudderless, according to industry leaders.

Read: Netflix names Snapchat execs as its first advertising leaders 

The streaming giant announced yesterday the appointment of Jeremi Gorman and Peter Naylor, both from Snap, to lead its burgeoning advertising division. The news came shortly following reports of mass layoffs at Snap. Snap declined to comment for this story and would not discuss its plans for layoffs, which were reported by The Verge. But advertising leaders said that the loss of Gorman and Naylor alone would hurt the company, leaving Snap without two of its top liaisons to the ad world.

“It’s a brilliant move by Netflix, they are getting the best in commercial strategy and video advertising,” said a senior agency executive, speaking on condition of anonymity. “It’s a huge loss for Snap. Snap needs to urgently hire great people and focus or they risk becoming irrelevant.”

With the loss of Gorman and Naylor, “it’s hard to see a strategy or future,” this senior agency exec said.

Since 2018, Gorman has been Snap’s chief business officer, helping to guide the mobile advertising business. Snap’s revenue, which mostly comes from ads, grew from about $320 million in the first quarter of 2019—Gorman's first full quarter with the company—to more than $1.1 billion in the second quarter of this year.

Read: How Snap is restructuring its ad business

Snap is viewed as an innovative company, leading the way on new video formats on mobile devices, and it was a pioneer in augmented reality. But there has been increased competition from TikTok, the Chinese-owned app, along with changes to Apple’s mobile ecosystem that have hobbled app marketers. Apps like Snap have lost data signals on consumers on iPhones because of Apple’s strict anti-tracking policies, which are meant to enhance privacy on the internet. The loss of data took the momentum away from Snap’s performance marketing models, where brands could see direct results from their ad campaigns.

Snap has acknowledged there have been some adverse effects on its ad business from Apple’s changes and other economic factors. On Tuesday, The Verge reported Snap would cut 20% of its workforce, which could affect about 1,250 people. Apple's changes have been disrupting all sorts of mobile app ad platforms and marketers, including Meta.

Related: How marketers are navigating privacy crackdowns

Netflix, meanwhile, has now hired Gorman, who brings years of experience working with major brands at Snap, where she helped advertisers adopt new mobile video formats and e-commerce tactics, all catering to Snapchat’s younger audience. Gorman was also at Snap while it built its own video distribution platform called Discover, teaching brands and media companies how to develop shows made for mobile devices. That's a skill that Netflix has tried to emulate as it markets on mobile devices and brings more of its programming there. Netflix and Snap both have common ambitions in gaming, too, as that genre takes more attention from young mobile audiences.

Before Snap, Gorman was with Amazon Advertising and spent time at Yahoo before that. Naylor has been Snap’s VP of ad sales in the Americas since 2020. Gorman will be Netflix’s president of worldwide advertising, while Naylor will serve as VP of ad sales.

Matt Barash, senior VP of Americas and global publishing at Index Exchange, the programmatic ad platform, has worked closely with Naylor in the past. He said that Netflix is getting “a package deal” with Naylor and Gorman. “You’ve got really two high-profile leaders, where most people were probably banking on the announcement of one,” Barash said.

The jump to Netflix is a sign of where the ad industry is headed, Barash said. Mobile apps are having a harder time because of the privacy changes to ecosystems like Apple and Google’s Android, meanwhile connected TV is on the rise. For years, Netflix resisted the pull to insert ads into its premium subscription video platform, and then this year it made the announcement it would partner with Microsoft to develop an ad-supported business. It had been expected that Netflix would hire some big names in the industry to help go after major marketing budgets.

“There is no one better [than Naylor] to walk into a holding company and start to build those connections,” Barash said. Naylor can explain the connected TV space to “agencies and CMOs, who want to be first to market and part of what is arguably one of hottest new ad offerings in recent memory.”

Naylor came up in advertising as an executive at NBCUniversal’s digital ad sales before leading Hulu’s ad sales from 2014 to 2020.

“The industry has tremendous respect for them both,” said Noah Mallin, chief strategy officer at IMGN Media, the media and tech company. “Peter, in many ways, legitimized Snap in industry eyes as a platform for advertising, and Jeremi brought stability. Getting them both is a major coup.”