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Forecasts show U.S. ad spend growing faster than expected, with a significant increase in ad dollars funneled through AI or automated campaign types, projected to reach 27% of U.S. spend by 2030.
The Interactive Advertising Bureau (IAB) has revised its U.S. ad spend growth forecast upward to 12.3% for the current year, from a previous 9.5% estimate. This accelerated growth is attributed to strong spending around major live events like the Winter Olympics and the World Cup, alongside advertisers' increasing adoption of powerful tools to engage customers. Research consultancy Madison & Wall also projects global ad spend to grow by 11% this year, exceeding $1.3 trillion, with a 12.9% growth in the second quarter.
A significant trend accompanying the rise in ad spend is the escalating proportion of ad dollars processed through AI or automated campaign types, such as Meta’s Advantage+ and Google’s Performance Max. Madison & Wall estimates that AI-directed spend will constitute 12% of U.S. ad spend this year ($479 billion excluding political ads), a substantial jump from just 2% in 2023. This share is projected to grow further, reaching $158 billion, or 27% of the U.S. ad market, by 2030. Luke Stillman from Madison & Wall attributes this surge to the convenience these AI tools offer to both small and large advertisers.
Major advertising platforms like Meta, Google, Reddit, Pinterest, and TikTok are actively offering and pushing automated campaign types driven by generative or other forms of AI. Media agency practitioners confirm the significant and growing usage of these tools among their clients. For instance, John Dawson, vp of strategy at Jellyfish, believes that automation in media will eventually reach 90% of operations, transforming how media is planned, bought, and optimized, as AI integrates into every part of the marketing lifecycle. WPP also predicts that AI search ads will become the fastest-growing channel in advertising.
Specific data highlights the rapid adoption of AI-powered ad solutions. Approximately 30% of Google's search spend now utilizes AI Max or Performance Max. Meta’s Advantage+ is on track to achieve a $75 billion run rate this year, up from $60 billion in 2025, with Meta's CFO Susan Li noting compounding performance gains for advertisers using multiple tools. Agency professionals like Becca Shih of Roast report that 11-12% of their search spending is through Performance Max, while Danny Weisman of Obsessed states some clients direct up to 30% of their ad dollars via Advantage+. Scott Hendler of Ars X Machina indicates PMax accounts for over 50% of some client budgets, suggesting a strong upward trend.
Beyond AI’s direct impact, the IAB’s forecasts show social media, commerce media, and CTV as the primary drivers of growth, with expected increases of 16.5%, 13.6%, and 15.6% respectively. Conversely, digital out-of-home and non-CTV digital video are projected to see slight decreases. The market continues to be dominated by tech giants, with Madison & Wall estimating that Google (Alphabet), Meta, and Amazon will collectively capture 60% of all ad revenue in North America, 59% in EMEA, and 53% in China. Despite the convenience and prevalence of automated AI tools, experts like Roast’s Becca Shih caution that optimal performance still relies on providing AI with proper context, likening it to receiving poor answers from ChatGPT if given poor input, highlighting the ongoing need for strategic human oversight.