Netflix is developing a new AI-powered ad format that will allow brands to integrate their products directly into the look and feel of its shows and movies. Revealed during its Upfront event, Netflix showcased an example where a product image was overlaid onto a background styled after Stranger Things. The move signals Netflix’s deeper push into immersive advertising, echoing strategies by competitors like Warner Bros. Discovery, but with a focus on generative AI to blend ads into familiar content environments.
Netflix will show generative AI ads midway through streams in 2026 pic.twitter.com/quHJzyVsCy
— Pirat_Nation 🔴 (@Pirat_Nation) May 15, 2025
For users on Netflix’s ad-supported tier, these AI-generated ads could appear mid-stream or during pause breaks, tailored to match the aesthetic of shows like Bridgerton or Wednesday. The new format may include overlays or interactive calls to action, offering advertisers more seamless and engaging placement opportunities.
Amy Reinhard, Netflix’s president of advertising, described the new ad format as offering “an entirely new palette” for brands to connect with viewers. Speaking at the event, Reinhard said innovation in AI-powered advertising is just beginning, adding, “The pace of progress is going to be even faster.”
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Netflix plans to fully roll out its new immersive, AI-driven ads by the end of the year, allowing advertisers to use overlays or interactive prompts that blend into its shows and films. While Netflix hasn’t disclosed the full scope of the technology, the approach reflects a broader industry shift toward integrating brands more naturally into content—similar to Warner Bros. Discovery’s recent push to commercialize its IP.
Netflix will use AI to make ad breaks look less like ad breaks https://t.co/XCAaPzm5Y7
— The Verge (@verge) May 15, 2025
The rollout aligns with the rapid growth of Netflix’s ad-supported tier, which now reaches 94 million monthly users—more than double the figure from last year. The strategy is aimed at boosting ad revenue while giving brands access to Netflix’s massive cultural influence through context-aware placements that feel less disruptive to viewers.
At the event, Reinhard stated, “When you compare us to our competitors, attention starts much higher and ends much higher. And even more impressive, members pay as much attention to mid-roll ads as they do to the shows and the movies themselves.”
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