Digital Video Ad Spend to Surge 14% by 2025

Digital Video Ad Spend to Surge 14% by 2025

Digital video advertising spending is projected to reach $72.4 billion in 2025, a 14% increase from $63.8 billion in 2024, according to the Interactive Advertising Bureau (IAB). This growth encompasses connected TV (CTV), social video, and online video.

In 2024, digital video ad spending surpassed linear TV for the first time, capturing 51% of total video ad spend. This trend is expected to accelerate in 2025, with digital video projected to represent 58%.

CPG and Retail Lead Digital Video Ad Spending

Consumer packaged goods (CPG) brands are expected to lead digital video ad spending in 2025 with a projected $14.3 billion investment, a 13% year-over-year increase. Retailers follow closely behind with a projected $8.4 billion spend, an 18% jump from 2024.

CTV Drives Growth and Programmatic Adoption

The IAB's "2025 Digital Video Ad Spend & Strategy Report" highlights the growing importance of CTV. Sixty-eight percent of marketers consider CTV a "must buy" in their media plans, driven by the platform's advancements in programmatic advertising tools, offering increased flexibility and control.

While all digital video platforms are predicted to experience double-digit growth in 2025, CTV stands out with a projected 13% increase, reaching $26.6 billion. This positions CTV as 43% larger than online video, estimated at $18.6 billion. Social video remains the largest category, projected to reach $27.2 billion.

The report suggests that CTV's growth may impact other channels. Thirty-six percent of marketers increasing CTV budgets plan to reallocate funds from linear TV and social media, while 32% will draw from paid search budgets.

This surge in digital video advertising aligns with the broader growth of digital advertising. In 2024, digital advertising grew by 14.9% year-over-year, reaching $258.6 billion, fueled by factors including spending diversification. Learn more about digital advertising growth.

The IAB report is based on an online survey conducted between February 17, 2025, and March 17, 2025, with 364 respondents who work directly with brands or agencies, spent at least $1 million on advertising in 2024, and are involved with digital video.