Overview of Netflix’s New Advertising Metric
Netflix announced on Wednesday that its ads reached over 190 million monthly active viewers (MAV) worldwide after implementing a new metric to measure its advertising reach in terms of people instead of accounts.
Netflix’s Expansion into Advertising and Gaming
As a streaming giant, Netflix has expanded into advertising and video games, areas that have contributed little to revenue so far, according to analysts and investors.
Understanding MAV
Netflix defines MAV as the number of users who have watched at least one minute of ad-supported programming and multiplies it by the average number of people in a household, based on Netflix’s internal research.
This new measurement allows Netflix to have a “more comprehensive count” of how many people are actually watching content on its platform.
Dynamic Ad Insertion (DAI) and Live Streaming
With Netflix’s entry into live streaming, the company began testing dynamic ad insertion (DAI) with WWE Raw and SmackDown during the previous quarter.
Netflix will now offer this technology in the US, Brazil, Canada, Germany, Mexico, and the UK for the upcoming NFL Christmas Gameday.
DAI enables Netflix to display specific ads tailored for each viewer in real-time during a live broadcast. The ad offering will expand to more live titles in 2026.
Netflix Ads Suite and Financial Performance
Greg Peters, Netflix’s co-CEO, mentioned during the previous quarterly results conference call that the company had its best advertising sales quarter in history and is on track to double its advertising revenue this year.
Peters noted that, although advertising remains small compared to subscription revenue, Netflix has “established the foundations” of this business and sees significant growth potential.
Netflix Ads Suite, its internal advertising platform, launched in the US and Canada in May and is now available across 12 countries.
Key Questions and Answers
- What is Netflix’s new advertising metric? The new metric, called Monthly Active Viewers (MAV), measures the number of unique individuals who have watched at least one minute of ad-supported content, multiplied by the average number of people in a household.
- Why did Netflix introduce this new metric? To provide a more accurate and comprehensive understanding of how many people are watching ad-supported content on its platform.
- What is Dynamic Ad Insertion (DAI)? DAI is a technology that allows Netflix to display specific ads tailored for each viewer in real-time during a live broadcast.
- In which countries is Netflix Ads Suite available? The internal advertising platform, Netflix Ads Suite, is currently available in the US, Canada, Brazil, Germany, Mexico, and the UK, with plans to expand further.
- How is Netflix’s advertising revenue performing? Despite being small compared to subscription revenue, Netflix’s advertising revenue has shown strong growth, with the company expecting it to double this year.
