The IAB has revised its 2026 U.S. ad spend forecast upward to 12.3% growth, a 2.8-point jump from the 9.5% it projected in January, and the survey of more than 200 brand and agency decision-makers behind that number tells a sharper story than the headline suggests. Customer acquisition is now the top media investment goal for 63% of buyers, up nine points since the winter read. Brand equity climbed six points to 43%. Repeat purchases held flat at 24%.

Translation: the big spenders are pointing their expanded budgets at the same new customers small businesses are trying to reach.

The channel mix says where the pressure lands. Social media is now projected to grow 16.5%, up from the January call of 14.6%. Commerce media moves to 13.6% from 12.1%. Connected TV rises to 15.6% from 13.8%. Digital out-of-home ticks down slightly to 7.0% from 7.4%, digital video (excluding CTV) settles at 9.4% versus 9.6%, and podcasts hold near flat at 8.7% against a prior 8.6%. Paid search sits essentially unchanged at 8.1%. Linear TV declines 1.5%; the combined radio-print-OOH-direct-mail bucket is now expected to fall 2.3%, worse than the January estimate of -1.1%. MediaPost’s composite forecast lifted two points, to 10.0% from 8.0%.

The AI overlay is where the story turns structural. Adapting to shifting consumer behavior, including AI-driven search, is now the single biggest challenge for 44% of buyers. Optimizing content for AI-generated answers is the top focus area at 76%, followed by LLM models at 72%. Generative AI use inside campaigns cooled to 69% from 78% in January, and 38% flag concern about AI slop. Meanwhile 86% say they’re already acting on the discovery shift.

Every prior ad cycle rewarded whoever adapted to the new discovery layer first. The last one was mobile-social in 2013. This one is being priced in now, in Q4 planning meetings small businesses aren’t sitting in.

Sources