Ads May Be Coming to Netflix Say Industry Executives

One of the most appealing things about streaming service Netflix was that there have been no commercials. This may be changing.

According to industry experts, Netflix may have to resort to ads if it wants to grow. The company has said it doesn’t want to run traditional ads however.

Ad executives from YouTube and JPMorgan Chase spoke at a panel at IAB’s Digital Content NewFronts about the matter.

“Well, that’s not what their recruiters say,” remarked Tara Walpert Levy, YouTube and Google’s VP of Agency and Media Solutions. “They’re going to need growth. Eventually, they’re going to need more growth.”

JP Morgan Chase CMO Kristin Lemkau chimed in, “The consumer wants choice and they want something that creates value for them. To the extent that you’ve got this subscription version versus the non-subscription version, consumers will take that tradeoff.”

Lemkau talked about “the biggest thing to happen in TV last night.” Lemkau was referring to last night’s Game of Thrones episode.

“It wouldn’t have worked with ads,” she explained. “That piece of content, that type of storytelling couldn’t have happened with ads. The army of the dead are at the wall, and we’re still fighting among the houses.”
Joshua Lowcock of media agency UM said, “We grew up in digital, believing we should inject ads everywhere at every moment we could. And that’s why you’ve seen ad blockers and a move to ad-free environments. I think there will become a tipping point where ads come back. Netflix is ad-free now. I can’t imagine a world where Netflix will be ad-free forever. If you look at their content costs … that’s where addressable advertising and new ad formats will come in.”

Disclaimer: We have no position in Netflix, Inc. (NASDAQ: NFLX) and have not been compensated for this article.