Netflix loses global ad president after brief but impactful 13-month stint

Netflix's global ad president, Jeremi Gorman, is leaving the company after just over a year. Gorman and Peter Naylor were hired from Snap in August 2022 to launch Netflix's ad-supported tier. Amy Reinhard, previously vice president of Netflix's studio operations, will take over Gorman's role. Naylor will remain as Netflix's vice president of global ad sales. Additionally, Elizabeth Stone has been promoted to chief technology officer and Eunice Kim to chief product officer, according to Variety.

Gorman, in a statement provided by Netflix, expressed his passion for scaling businesses, particularly in the early stages. He highlighted his experience at Netflix, where he played a significant role in building a world-class team and establishing the necessary foundations for a flourishing ads business.

Gorman further emphasized the exceptional storytelling at Netflix, drawing the interest of brands who strive to be a part of this cultural phenomenon. Having worked closely with Amy on the leadership team, he personally witnessed her operational brilliance and entertainment expertise. Gorman believes that with her guidance, brands will be able to capitalize on 'The Netflix Effect' in innovative and extraordinary ways.

Netflix introduced its ad-supported plan in the U.S. in November, costing $6.99 per month. This is a significant departure for the platform, which has resisted the inclusion of commercials for a long time. To strengthen its ad sales and ad-tech operations, Netflix has partnered with Microsoft, though this collaboration has faced some challenges. Other third-party partners, such as Integral Ad Science and DoubleVerify, have also been brought on board to enhance the division's capabilities in ad verification and measurement.

Netflix's leadership has consistently emphasized their methodical approach to establishing an ad segment, referring to it as a "crawl, walk, run" strategy. While the company experienced a 3% increase in revenue to $8.2 billion in the second quarter, advertising did not yet make a significant contribution to the overall financial results. However, executives have stated their belief that advertising will eventually account for at least 10% of total revenue.

Netflix has limited advertising formats to avoid annoying viewers who prefer uninterrupted streaming. Brands like NYX Professional Makeup, L’Oreal Paris, AB InBev, Subway, and Google have already advertised on the platform. During its first upfronts presentation, Netflix announced that its ad-supported tier gained 5 million subscribers in the first six months. The streaming service is considering raising the price of its ad-free plan after resolving the SAG-AFTRA strike, which could lead more consumers to switch to the cheaper ad-supported tier.

Netflix is not the only platform making efforts to attract advertisers. In September, Amazon revealed its plans to introduce a limited number of commercials on Prime Video, marking a substantial expansion of its strategies to monetize the streaming service. In addition to this, both HBO Max and Disney+ have placed greater emphasis on ad-supported options, as the streaming industry shifts its attention towards profitability rather than solely focusing on increasing subscriber numbers.