IAB raises US ad spend forecast for 2026

The revised outlook follows stronger-than-expected advertising activity in the first half of the year.

The Interactive Advertising Bureau (IAB) has raised its forecast for U.S. advertising spend growth in 2026 to 12.3 percent, up from its January projection of 9.5 percent.

The findings come from IAB’s 2026 Outlook Study: September Update, based on input from more than 200 brand and agency decision-makers responsible for advertising investment. Major cyclical events, including the Winter Olympics and FIFA World Cup, contributed to first-half growth, while concerns about macroeconomic conditions have eased.

Customer acquisition becomes a bigger priority

IAB’s updated outlook shows a shift in advertisers’ media investment goals. Customer acquisition, typically the leading objective, increased by nine percentage points since January to 63 percent. Brand equity rose six points to 43 percent, while repeat purchases remained broadly unchanged at 24 percent after nearly doubling as a priority since 2024.

Persistent inflation and cautious consumer sentiment are contributing to more selective purchasing behavior, with shoppers increasingly willing to switch brands and retailers. This is prompting advertisers to reinforce brand strength while seeking opportunities to attract consumers who are open to alternatives.

David Cohen, CEO, IAB: "The first half was strong, major live events delivered, and advertisers have increasingly powerful tools in their arsenal to find and engage customers," said David Cohen, CEO, IAB. "At the same time, the economy has real areas of uncertainty. There is growth to be found, but there are no easy wins. When consumers are considering their next purchase, the brands that win will be connecting with them at the right time, in the right context, and with a compelling message."

AI discovery creates new challenges for marketers

Adapting to changing consumer behavior, including AI-driven search, is the leading media investment challenge, cited by 44 percent of buyers. Concern about low-quality AI-generated content, described in the study as AI slop, follows at 38 percent.

Optimizing content for AI-generated answers is the area receiving the greatest increased focus, cited by 76 percent of buyers. This is followed by AI large language models at 72 percent and the use of generative AI in media campaigns at 69 percent, compared with 78 percent in January.

Chris Bruderle, Vice President, Industry Insights & Content Strategy, IAB: "Consumers are becoming more discerning. They're switching brands, paying for lower-priced brands and looking at store brands," said Chris Bruderle, Vice President, Industry Insights & Content Strategy, IAB. "For brands, that means two things. They need to make sure their brand equity is strong, particularly in AI environments. And if people are more willing to switch brands, there's an opportunity to acquire new customers."

Marketers adapt measurement to AI-driven journeys

The growing role of conversational AI is also affecting media measurement. Some 86 percent of buyers are already changing, or expect to change, how they measure media performance because of conversational AI tools and AI agents over the next 12 months.

Measuring brand visibility and citations within AI tools is the most common response, selected by 48 percent of buyers. Other approaches include using branded search and direct traffic as proxies, adding third-party AI discovery analysis tools, monitoring interactions and referrals from AI platforms, and increasing incrementality testing.

Connecting AI signals remains a challenge

Despite these changes, advertisers continue to struggle to connect AI-related signals with established measures of performance. Some 45 percent of buyers identify comparing AI-driven and traditional customer journeys as their leading measurement challenge.

Chris Bruderle: "What we are seeing is a pretty meaningful evolution in the AI conversation," said Brudele. "Marketers have spent a lot of time asking, 'How can I use AI?' Now the question is becoming, 'How do I reach a consumer who uses AI?' People are discovering products and evaluating brands inside these environments. Marketers want to understand how their brands show up in those conversations and how that activity connects to everything else they know about the customer journey."

Advertisers broaden their approach to consumer attention

As audiences spread across traditional search, conversational AI, commerce platforms, social media and other discovery environments, advertisers are shifting their focus toward formats and channels that can help them reach consumers in those environments.

The advertising approaches receiving the greatest increased focus are creator and influencer advertising or partnerships, cited by 54 percent of buyers; demographic-targeted and cohort-based advertising, at 53 percent; publishers with first-party data, at 48 percent; and contextual advertising, at 45 percent.

Trust and visibility shape the emerging media strategy

The findings point to a broader focus on building consumer trust, identifying valuable audiences and maintaining visibility as product discovery becomes more fragmented.

Chris Bruderle: "The pieces really do connect," said Bruderle. "If consumers are moving across more places to discover products, marketers have to think differently about how they earn trust, how they identify the right audiences, and how their content gets found. Visibility is becoming part of the media strategy in a much broader way. It includes the creator someone trusts, the environment where an ad appears, and increasingly what an AI platform says when someone asks about your category or your brand."

The full report can be accessed here

www.iab.com

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