Netflix Wants To Eventually Integrate Product Placement Into Show Storylines




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Netflix co-CEO Greg Peters has lofty ambitions for what the streaming service can do with product placement and how it can enhance its ad-supported service. 

Peters wants to eventually start “working with showrunners on series with a secondary brand narrative,” suggesting whole storylines could be built around a product or ad campaign, adding he wants the ads “to feel like they’re more part of the universe.” 

Peters, who made those comments while speaking at Goldman Sachs’ annual Communicopia and Technology conference on Tuesday, said the company continues to think about how to get deeper into the advertising business. He added the litmus test is whether these storylines work well enough that even subscribers to the more premium tier would want to watch the shows. 

The comments hint at the big plans that Netflix has for its ad-supported tier, which launched in November but has gained traction through its lower $6.99-a-month price. Netflix is just one of many companies that have opened their service up by offering a cheaper ad tier, a move necessitated by the sheer volume of subscription services and the limited budgets of consumers. 

For Netflix, the ad business isn’t just an experiment. 

“It’s a long-term, multi-decades business where we’ll want to constantly get better at,” Peters said at the conference. 

Still, the idea of so deeply integrating product placement into storylines – while not novel – might face resistance from writers, who remain on strike alongside the actors. 

Other points:

  • Peters indirectly addressed the popularity of YouTube and TikTok, noting that it wasn’t interested in short-form programming or user-generated content. 
  • Peters talked about Netflix’s gaming aspirations, noting that it has invested in a cloud streaming initiative to bring games to all devices. But it’s still a work in progress, he said. “We don’t know if we can deliver it in 18 months or a couple of years down the road,” he said. “But we will be everywhere with gaming.” 
  • Peters pointed to success of One Piece, a live-action adaptation of a long-running anime series, as an example of how Netflix will continue to break barriers and bring stories from all over the world to the streamer’s global audience. 
  • Peters calls how Netflix has addressed password sharing “an elegant solution that is a competitive differentiator,” that he believes competitors will struggle to match. 
  • Peters said he wants to broaden the range of pricing for customers, with the ad-tier representing one end of the spectrum to a more premium tier that would serve the super-fan. He didn’t go into detail into what that would look like.

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