Digital video has surpassed linear TV as the dominant media buy heading into the upfront season. This is according to the Interactive Advertising Bureau’s (IAB) newly released "2025 Digital Video Ad Spend & Strategy Report: Part One."

The report, developed in partnership with Advertiser Perceptions and Guideline, shows digital video is projected to capture nearly 60% of all U.S. Five years ago, digital video made up less than 30% of that same spend. Today, it’s more than doubled, reflecting where advertisers are now placing their bets. 

Digital video has moved from being a complementary channel to becoming the primary screen for advertisers. Connected TV (CTV), social video, and online video have become core channels for media buyers trying to reach their audiences.

David Cohen, CEO of the IAB, explained the shift by pointing to the rise of streaming content and new ad tech. According to Cohen, “2024 was a pivotal year for digital video advertising. With high-quality content moving to streaming, advancements in advertising technology, and an influx of new inventory, growth has accelerated for both consumers and advertisers.”

CTV drives growth with live events and self-serve tools

A part of this shift is the boom in Connected TV (CTV). The IAB reports that CTV spending grew 16% year-over-year in 2024, rebounding thanks to live sports, streaming events, and improved access to self-serve, programmatic ad platforms.

Self-serve and programmatic platforms are enabling small and mid-sized brands to get in on the CTV action. These advertisers are no longer held back by high entry costs or limited access. Cohen explained that “Self-service technology, accessible pricing, and the ability to link spending to real-world outcomes have empowered small and mid-size businesses to join the CTV movement in ways that were not possible a few years ago.”

CTV isn’t just a place for big brands with large budgets anymore. Small businesses such as local shops, DTC brands, and niche services are all using targeting and automation to make every dollar count.

Social and online videos are rising alongside CTV

Social video and online videos are also key pillars of the digital video ecosystem. Chris Bruderle, Vice President of Industry Insights & Content Strategy at IAB, noted that
“CTV and social video are now core pillars of a brand’s integrated media strategy. Advertisers are following consumers to these platforms, seeking not just reach but real business outcomes.”

In 2024, social video ad spending increased by 21%, and online video grew by 17%. Together, these formats are helping advertisers extend their reach across channels. From TikTok Reels to YouTube pre-rolls and CTV ads, it’s all about meeting audiences where they are.

$72B projected spend shows digital video is marketers’ safest bet

The IAB projects U.S. digital video ad spend will reach $72 billion in 2025, up from $64 billion in 2024—a 14% increase. In contrast, total media spending isn’t growing nearly as fast, meaning digital video is outpacing the market by two to three times.

According to the report, categories like consumer packaged goods (CPG), retail, and pharma are leading the way. These industries rely heavily on brand visibility and performance marketing.

What’s striking is that the spending isn’t just climbing—it’s coming from budgets that used to go to linear TV and even social media.

The IAB says economic uncertainties and geopolitical risks may impact this growth 

While the data points to growth, the IAB cautions that economic uncertainties may impact future projections. David Cohen noted that several factors including the ongoing economic pressures, geopolitical risks, and consumer confidence make the 2025 market harder to predict.

‍