2 in 5 ad buyers say CTV is limited by a lack of interactive capabilities: report

Streamers have been trying to make CTV shopping look desirable for years, whether we’re talking about Peacock’s Virtual Concessions introduced ahead of the 2024 Paris Olympics, or Hulu’s rollout of pause ads in 2018 that paved the way for shoppable ad units.

Despite the developments, ad buyers remain concerned about CTV’s effectiveness, according to the IAB’s 2026 Digital Video Ad Spend & Strategy Report, which pairs survey data from 400 digital video ad buyers with billing and market data from intelligence firm Guideline. More than a third (39%) of buyers surveyed indicated a dearth of interactive offerings as a limitation to the channel’s effectiveness, while nearly the same amount (38%) said the requirement of a second device to complete further shopping-related actions posed a challenge.

“An industry-wide trust problem persists across the streaming programmatic ecosystem spanning all activation methods,” the report read.

Overall, the segment experienced a decrease in growth. The report noted that the decline was not due to a “loss of channel confidence,” but rather that advertisers were “exercising budget discipline amid rising media costs.” The number of “small spenders,” aka media buyers with smaller budgets, spending on the channel has increased from 60% in 2024 to 85% this year, “with self-serve platforms lowering the entry barrier,” according to the report.

“CTV’s continued momentum is driven by live events, ‘Hollywood-produced’ content and, perhaps most importantly, a strengthening track record of delivering measurable business outcomes,” the report read.

With that said, there was some slowdown in channel confidence: While 61% of buyers described CTV/OTT as a “must-buy,” that was down from 68% last year, per the report.

Cost and audience delivery were top reasons for buyers decreasing or terminating spend with a streaming service; nearly half of the buyers surveyed reported each as concerns, the report found. Beyond that, more than a third (35%) of buyers surveyed said there was a “limited scale of shoppable formats” on CTV, while 34%, and 44% of small- and mid-sized spenders, whose annual ad spend is less than $50 million, felt cost-per-action was too high.

Nearly half (43%) of those surveyed indicated that interactive capabilities were crucial at the end of the customer journey, per the report. The only factor that buyers rated higher at that part of the customer journey was viewer mindset while watching, like if viewers were engaged with programming or were involved in other activities, like their phones.

Out of all of the CTV buying methods that buyers were surveyed on, the method with the highest percentage of buyers (57%) expressing “high confidence” was publisher/direct I/O. Buyers indicated fraud or invalid traffic (56%) and unverifiability of publisher or content source (48%) as top concerns impacting trust in transparency in regard to CTV programmatic inventory available on open exchanges.

When it comes to paying for services to help with transparency, less than a third (31%) of buyers were willing to spend on fraud detection tools, per the report. In comparison, 4 in 10 were willing to pay for brand safety and suitability verification services.

Go big or go home: Digital video, encompassing CTV, online video, and social video, continues to grow at a fast clip, the IAB found. US digital video spend is expected to increase 11% this year, and for the first time ever, it is expected to make up more than 60% of TV/video ad spend. Social video alone is also growing, up seven percentage points year over year thanks to factors including “AI-powered measurement and optimization, creator presence, and native commerce capabilities.”

Amid that investment in digital video, AI is taking an even bigger seat. Six in 10 buyers reported using generative AI to build or enhance digital video ads, up from 51% last year, according to the report, and digital video ads using generative AI make up 33% of the pool, a nine percentage-point increase from 24% in 2025.

The report notes that two-thirds of buyers are in some stage of using agentic AI for digital video campaigns. “Nearly all buyers are already in market or on a near-term path to adopting agentic AI for digital video campaigns,” the report read. “That suggests that AI is rapidly moving from experimental to operational in digital video.”

That being said, media buyers are still cautious around agentic AI: human involvement is seen as critical in certain use cases, according to the report.