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Nearly 90% of advertisers will use AI to build video ads by 2026

IAB report reveals 86% of buyers using AI for video ads, with CTV inventory becoming 47% biddable as performance metrics dominate.

Luis Rijo

• 9 min read
90% statistic with AI circuit pattern showing advertisers adopting artificial intelligence for ads
90% statistic with AI circuit pattern showing advertisers adopting artificial intelligence for ads

The Interactive Advertising Bureau released its 2025 Digital Video Ad Spend & Strategy Full Report on July 15, 2025, revealing that nearly 90% of advertisers will deploy generative artificial intelligence for video advertisement creation by 2026. The comprehensive study, created in partnership with Advertiser Perceptions and Guideline, demonstrates how AI technologies are fundamentally reshaping video advertising production and distribution strategies.

According to the report, 86% of buyers currently use or plan to implement generative AI for video ad creative development. This technology adoption represents a significant shift from traditional video production methods, particularly benefiting small and mid-tier brands that previously lacked resources for high-quality video content creation.

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Summary

Who: Interactive Advertising Bureau, in partnership with Advertiser Perceptions and Guideline, surveyed digital video advertisers and buyers to assess industry trends in video advertising technology and spending patterns.

What: Release of the 2025 Digital Video Ad Spend & Strategy Full Report revealing that 86% of buyers use or plan to use generative AI for video ad creative, with expectations that AI will account for 40% of all ads by 2026 and CTV inventory becoming 47% biddable.

When: The report was released on July 15, 2025, during the IAB Media Center's Video Leadership Summit, with data reflecting current industry practices and projections through 2026.

Where: The study encompasses the broader digital advertising ecosystem, focusing on connected television, social video, and streaming platforms across multiple markets where video advertising is deployed.

Why: The research addresses the industry's need to understand how generative AI technologies and programmatic buying are transforming video advertising production, distribution, and measurement, particularly as economic pressures demand demonstrable business outcomes from advertising investments.

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The research indicates that buyers project generative AI creative will account for 40% of all advertisements by 2026. Small and mid-tier brands demonstrate faster adoption rates compared to larger enterprises, leveraging AI capabilities to produce professional-quality digital video ads efficiently and cost-effectively without requiring extensive production teams or budgets.

Connected television inventory shifts toward programmatic

Buyers now expect 47% of connected television inventory to become biddable, representing a substantial increase from 34% in the previous year. This shift reflects the maturing programmatic ecosystem within streaming platforms, where automated buying processes are becoming standard practice across premium video inventory.

The report found that 74% of buyers have built or plan to establish internal teams for managing self-serve connected television activation. This internal capability development indicates advertisers' strategic commitment to programmatic CTV buying, as industry data shows CTV budgets projected to double from 14% in 2023 to 28% in 2025.

Despite increasing automation, buyers demand human assistance from sell-side partners. More than 80% of digital video buyers require strategic support when executing programmatic connected television campaigns, underscoring the ongoing need for technical expertise in campaign management and optimization.

AI creative enhancement capabilities expand

Advertisers utilize generative AI creative enhancement for multiple strategic applications. The report identifies three primary use cases: creating versions for different audiences (42%), implementing visual style changes (38%), and developing contextual relevance (36%).

These capabilities enable advertisers to produce numerous creative variations rapidly, addressing the challenge of maintaining fresh content across diverse audience segments. The technology eliminates traditional barriers to creative testing, allowing brands to experiment with multiple messaging approaches simultaneously without proportional increases in production costs.

According to IAB CEO David Cohen, "The economics of advertising are being transformed. As the costs of production fall, the opportunities for advertisers multiply. The pool of potential advertisers is growing, as it is easier than ever to plan, buy, optimize, and creatively connect with consumers utilizing new technologies across all forms of media."

Live streaming content drives platform expectations

Buyers express elevated expectations for live content on streaming platforms, with 60% demanding capabilities superior to traditional linear television. One-third of buyers specifically want unique interactive experiences and real-time data access during live streaming events.

The emergence of sports and live events on streaming platforms creates new opportunities for advertisers seeking engagement beyond traditional broadcast television. According to Chris Bruderle, Vice President of Industry Insights & Content Strategy at IAB, "Buyers are excited about sports and other live content coming to streaming. They expect to see new and better capabilities than they can get in linear."

This aligns with recent industry developments where streaming platforms are rapidly expanding their live content offerings, providing advertisers with additional premium inventory for campaign deployment.

Business outcomes become primary performance metric

The report reveals a fundamental shift in campaign measurement priorities, with store visits and sales becoming the most important key performance indicators for video buyers. This emphasis on business outcomes reflects economic uncertainty and the need for demonstrable return on advertising investment.

Digital video buyers identified failure to deliver business outcomes as the primary reason for reducing or removing spend with streaming partners. This performance-focused approach indicates that brand awareness metrics alone no longer satisfy advertiser requirements in the current economic environment.

According to the study, connected television is rapidly closing the performance gap with social video as a business outcome-driving channel. Buyers now hold both platforms to similar expectations for generating sales and offline store visits, representing a significant evolution in how streaming inventory is evaluated.

Measurement challenges persist across platforms

The fragmented nature of connected television advertising continues to create measurement complexities for advertisers. Industry initiatives like the Ad Creative Identification Framework (ACIF) are being developed to address these challenges by establishing standardized identification systems for ad creatives across platforms.

Technical measurement improvements are essential for connected television's continued growth. Without consistent identification and reporting standards, advertisers face difficulties in frequency capping, competitive separation, and cross-platform campaign reconciliation.

The report emphasizes that measurement accuracy directly impacts advertiser confidence in streaming platforms. Enhanced measurement capabilities enable better budget allocation decisions and campaign optimization, ultimately supporting the platform's ability to attract and retain advertising investment.

Strategic implications for marketing professionals

The transformation of video advertising presents both opportunities and challenges for marketing professionals. The democratization of video ad creation through AI technologies enables smaller businesses to compete with established brands in premium video environments.

However, this technological shift also raises questions about the future role of creative agencies and in-house marketing teams. As Meta's CEO Mark Zuckerberg has outlined plans to replace creative agencies with AI, the industry must adapt to new workflows where human creativity focuses on strategy and brand development rather than production execution.

The emphasis on business outcomes measurement requires marketing professionals to develop deeper analytical capabilities. Understanding performance attribution across multiple platforms and channels becomes essential for demonstrating advertising effectiveness and securing continued investment.

The IAB report's findings align with broader industry trends toward automation and artificial intelligence in digital advertising. Major platforms including Google, Meta, and Amazon have all expanded their AI-powered creative tools throughout 2024 and 2025, indicating widespread adoption of these technologies across the advertising ecosystem.

The connected television market's evolution mirrors developments in programmatic advertising generally, where 72% of marketers plan to increase programmatic investment in 2025. This growth reflects advertiser confidence in automated buying processes and the efficiency gains they provide.

The report's emphasis on business outcomes measurement reflects broader economic pressures affecting advertising investment decisions. In an environment of geopolitical uncertainty and inflation concerns, advertisers require more concrete evidence of advertising effectiveness to justify continued spending.

Technical implementation considerations

For advertisers planning to implement AI-powered video creative development, the report suggests several technical considerations. Integration with existing campaign management systems requires careful planning to ensure seamless workflow adoption without disrupting current operations.

The transition to programmatic connected television buying necessitates internal capability development. Organizations must invest in training and technology infrastructure to effectively manage self-serve activation tools while maintaining campaign performance standards.

Measurement integration across multiple platforms requires standardized reporting frameworks. Advertisers must establish consistent metrics and attribution models to accurately assess campaign performance across diverse streaming environments.

Jamie Finstein, Vice President of Media Center at IAB, noted: "Being available programmatically is table stakes. Being a strategic partner who delivers ideas and results is becoming what's vital to win ad spend. As digital video democratizes advertising for small and mid-sized businesses, many of these brands struggle with measurement complexity, standardization, cross-channel data, and scalability."

Future outlook and implications

The report's findings suggest accelerating change in video advertising production and distribution methods. The combination of AI creative tools and programmatic buying platforms creates new possibilities for campaign execution and optimization.

The emphasis on business outcomes measurement indicates that platforms must continue investing in attribution and measurement capabilities to maintain advertiser confidence. Those that fail to demonstrate clear business value risk losing market share to competitors with superior measurement offerings.

The connected television market's continued growth depends on resolving technical challenges around measurement and inventory standardization. Industry collaboration on initiatives like creative identification frameworks will be essential for maintaining advertiser confidence as the market expands.

For marketing professionals, the transformation requires adapting to new tools and workflows while maintaining focus on strategic objectives. The most successful organizations will be those that embrace AI capabilities while developing human expertise in areas where technology cannot replace strategic thinking and creative vision.

Key Terms Explained

Generative Artificial Intelligence (AI): Advanced machine learning technology that creates new content, including video advertisements, by analyzing existing data patterns and generating original creative assets. Unlike traditional AI that analyzes or classifies content, generative AI produces entirely new materials such as video scripts, visual elements, and complete advertisements tailored to specific audiences and campaign objectives.

Connected Television (CTV): Television content delivered through internet-connected devices rather than traditional broadcast or cable systems, including smart TVs, streaming devices, and gaming consoles. CTV represents a growing segment of video advertising inventory that combines television's premium viewing environment with digital advertising's targeting and measurement capabilities, enabling advertisers to reach cord-cutting audiences through streaming platforms.

Programmatic Advertising: Automated buying and selling of advertising inventory through real-time bidding systems that use algorithms to purchase ad placements across multiple platforms. This technology eliminates manual negotiations and insertion orders, allowing advertisers to target specific audiences at scale while optimizing campaign performance through data-driven decision making and automated bid adjustments.

Biddable Inventory: Advertising space that can be purchased through automated auction systems where advertisers compete in real-time for ad placements based on targeting criteria and bid amounts. This represents a shift from traditional fixed-price advertising deals to dynamic pricing models where inventory costs fluctuate based on demand, audience value, and competition levels.

Creative Enhancement: The process of modifying existing advertising content to create multiple variations optimized for different audiences, platforms, or campaign objectives. This includes adjusting visual elements, messaging, format specifications, and contextual relevance to maximize engagement while maintaining brand consistency across diverse media environments and audience segments.

Business Outcomes Measurement: Performance evaluation methodology that focuses on concrete business results such as sales, store visits, app downloads, or lead generation rather than traditional awareness metrics like impressions or reach. This approach requires sophisticated attribution modeling to connect advertising exposure directly to consumer actions and revenue generation.

Frequency Capping: Advertising delivery control mechanism that limits how often individual users see the same advertisement within a specified time period. This prevents ad fatigue and excessive exposure while optimizing campaign efficiency by ensuring budget allocation reaches the broadest possible audience without overwhelming viewers with repetitive messaging.

Self-Serve Activation: Platform capabilities that enable advertisers to independently create, launch, and manage campaigns without requiring direct sales representative involvement. These tools typically include user-friendly interfaces for audience targeting, budget allocation, creative upload, and performance monitoring, democratizing access to advertising platforms for businesses of all sizes.

Cross-Platform Attribution: Measurement methodology that tracks consumer interactions across multiple devices, platforms, and touchpoints to accurately assess advertising campaign effectiveness. This complex process requires sophisticated data integration to connect user behavior across web, mobile, connected TV, and offline environments while respecting privacy regulations and technical limitations.

Automated Creative Optimization: Technology-driven process that continuously tests, analyzes, and adjusts advertising creative elements to maximize performance based on real-time audience response data. This includes automated A/B testing of headlines, images, videos, and call-to-action elements, with machine learning algorithms identifying the most effective combinations for specific audience segments and campaign objectives.

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