Netflix to launch AI-driven ads that match show aesthetics

Netflix is developing a new advertising format that will use artificial intelligence to integrate branded content into the visual environment of its shows and films, the company announced during its annual Upfront event on Wednesday.

The streaming giant said the new ads will allow advertisers to 'marry' their products with the aesthetics of Netflix originals, such as Stranger Things, Bridgerton, or Wednesday. A demonstration featured a product placement that appeared over a scene inspired by Stranger Things, blending the advert seamlessly into the show's background.

For subscribers on Netflix’s ad-supported tier, this means ads could soon appear that visually match the programme being watched. These advertisements may be shown mid-programme or during pause screens and may include an overlay or call to action. The new format is expected to launch by the end of 2025.

The development follows similar efforts by other media firms, such as Warner Bros. Discovery, to more deeply integrate branded content within their intellectual property. However, Netflix appears to be taking a different approach by using generative AI to dynamically match product visuals with the look and feel of its content.

Amy Reinhard, Netflix’s president of advertising, said the company is accelerating its advertising innovations. “The pace of progress is going to be even faster,” she told advertisers during the presentation.

The announcement comes amid strong growth in Netflix’s ad-supported tier. The company revealed the tier now has 94 million monthly active users, more than double the 40 million it reported at the same time last year. This surge underscores the increasing importance of advertising revenue to Netflix’s broader business model.

Netflix has not provided specific details on how user data will be used to personalise these AI-driven adverts or whether viewers will have the option to opt out of the experience.

The streaming service first introduced its ad-supported plan in late 2022, marking a shift away from its long-standing ad-free model. Since then, it has steadily increased its investment in advertising technology and partnerships.

Further developments on the AI-integrated ad format are expected later this year as the platform begins testing with select advertisers.

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