Netflix, eager to spark better relationships with Madison Avenue after years of avoiding them, has lured two senior executives away from Snap to do so.
The streaming giant has hired Jeremi Gorman, Snap’s chief business officer, and Peter Naylor, its vice president of sales, to start making outreach to top advertisers in a bid to launch an ad-supported tier for subscribers who may be looking for new value propositions amid a roiling stock market and as competition for broadband-savvy consumers has grown more intense.
“Jeremi’s deep experience in running ad businesses and Peter’s background in leading ad sales teams together will be key as we expand membership options for consumers through a new ad-supported offering,” said Greg Peters, Netflix’s chief operating officer, in a statement.
Netflix is joining a chase for ad dollars that other streamers have already begun. HBO Max, part of the newly-merged Warner Bros. Discovery, has already expressed its willingness to run commercials before some HBO movies. Disney+ intends to launch an ad-supported tier in weeks to come. Hulu has begun to reach out to local and regional advertisers, not just the big national marketers coveted by major media outlets.
The streamer is betting on two executives familiar with the ins and outs of digital advertising. Gorman joined Snap in November 2018 from Amazon, where she oversaw the global sales team responsible for enterprise advertisers. Naylor, meanwhile, has driven digital ad sales for both NBCUniversal and Hulu in past jobs. They both depart Snap as it is facing a slump in its stock and a foggy outlook about the future of digital ad spending as more companies chase dollars being committed to the medium.
Netflix in July said it had enlisted Microsoft as its partner to build an ad-sales system. By taking on a partner, Netflix will likely have to sacrifice some of the ad revenue it generates. Yet building an ad-sales unit where none exists is a daunting task, and Netflix may have required help to get started as its rivals — already well-versed in how to sell millions of dollars in commercial inventory to Madison Avenue — use their hard-won expertise as an edge. Disney, for example, has also reached out for allies, and recently unveiled a new agreement between itself and the ad-tech company the Trade Desk as part of an effort to boost the commercial inventory it sells via connected-TV.