AI-driven spending on advertising in the UK will rise to £18bn, or 32% of total ad spend, by 2030, according to research from the Internet Advertising Bureau (IAB) UK.
Publishing its findings in The State of AI in Advertising, the IAB reports that 74% of its members are now using agentic AI, although only 4% would currently describe themselves as ‘agent-first.’
Yet the same survey finds that this latter percentage could change quickly, with 63% of IAB members expecting an “accelerating or transformative shift” within the next 12 months in how advertising content is created.
And according to the IAB’s Chief Strategy Officer, James Chandler, AI will become an integrated part of digital marketing and advertising over the next few years, while the most successful organisations will be those that embed AI tools in their operations, rather than simply deploy them.
Zero-click search and agentic commerce
IAB’s report highlights four main areas in which AI will increasingly drive advertising spend: content creation, zero-click search, agentic trading, and agentic commerce.
The £18bn figure is actually a middle-of-the-road estimation for 2030, while a ‘worst case’ scenario still involves a not-insignificant spend of £14.5bn. Conversely, IAB’s ‘best case’ scenario sees AI-driven ad spend rise to £21.5bn, representing 38% of total spend in the UK.
While the use of AI hasn’t yet reached such levels, the IAB’s James Chandler affirms that its use is already substantial.
“The biggest impact today is not a single breakthrough application, but the fact that AI is being embedded across almost every part of the advertising process,” he tells Raconteur.
The biggest impact today is that AI is being embedded across almost every part of the advertising process
This includes creative and content development, for which only 2% of survey respondents say AI’s impact has been ‘minimal,’ whereas 7% attest to pilots and basic usage, 28% to noticeable increases in use, 50% to significant change, and 13% to major, transformative change.
“AI is helping teams produce, adapt and personalise creative more quickly and efficiently,” Chandler explains. “Whether that’s generating copy, creating assets, testing variations or adjusting content for different audiences, it’s giving people the ability to do more, faster.”
Importantly, Chandler adds that marketing teams are still exercising human judgement, and that new tools are enhancing and supporting productivity, rather than replacing creativity. It’s a similar story in the second area in which AI is becoming more prevalent, buying and optimisation. Here, the use of AI has become more sophisticated in the past couple of years, having featured in digital advertising for quite some time through programmatic trading, for example.
Chandler says, “It’s helping marketers uncover audience insights, optimise campaigns and improve measurement and decision-making processes, freeing up teams to focus on strategy and outcomes.”
20% of IAB UK’s members forecast that agentic AI will become a major way ad media is bought and sold, while 29% say agents will create value, but not necessarily in predictable ways. Meanwhile, 35% say that agentic AI will be used in some areas of ad trading, although it will remain relatively niche.
This suggests considerable optimism in terms of AI’s impact on digital marketing, but one of the more controversial areas relates to zero-click searches. This is where, because of Google AI Overviews and other generated summaries, consumers tend not to click on normal search results or ads, with 62% of IAB members reporting significant change or even major disruption to how they’ve traditionally approached search.
AI-powered search experiences are altering how consumers find information and make decisions
“As AI-generated answers become more prominent, brands need to think not only about being found in traditional search results,” says Chandler, “but also concerning how they appear in AI-generated recommendations and summaries.”
Another similarly new area is agentic commerce, whereby AI is actually doing much of the legwork in researching and even buying products on behalf of consumers. “While we’re still in the early stages, AI is beginning to play a more active role across the customer journey, from discovery through to transaction,” Chandler says.
This is perhaps the most experimental area of AI-driven marketing, with only 23% of IAB members expecting agentic commerce to expand or scale within the next 12 months. What’s interesting here is that, while only 8% of members strongly agree that consumers will never trust an AI agent to make significant purchases on their behalf, the corresponding percentage for consumers themselves is 47%. So this may be one area where it takes a little longer to make AI stick.
OS over SaaS
According to Chandler, what connects the developments in all these areas is that they exemplify how AI is becoming less of a “standalone” tool and more of a capability embedded across pretty much everything marketing teams do. And such deep, wide-ranging integration is likely to become more prevalent in the next few years.
“In much the same way that digital stopped being a specialist discipline and became part of every marketing function, AI is likely to follow a similar path,” he predicts. “It will become part of the operating system rather than a distinct capability sitting in one team.”
This doesn’t mean that Chandler believes adoption will be straightforward, as evinced by some of the responses consumers gave to IAB’s latest survey. In fact, out of 2,000 consumers surveyed by the trade association, 40% said they would “never” allow an agent to make purchases for them, for example. Even when it comes to building an online shopping basket, 53% said they would either never allow it (23%), or feel very (11%) or somewhat (19%) uncomfortable.
Given this discomfort, Chandler says that the next phase of AI adoption in marketing will be about establishing frameworks around standards, governance and disclosure that would provide consumers and businesses alike with confidence.
“Questions around accountability, measurement, brand safety, transparency and responsible use will become increasingly important as AI takes on a bigger role,” he says. “I expect AI to become far more central to how advertisers reach consumers, but the winners will be the organisations that treat it as a capability to be embedded responsibly across the business, rather than simply a technology to be deployed.”
AI-driven spending on advertising in the UK will rise to £18bn, or 32% of total ad spend, by 2030, according to research from the Internet Advertising Bureau (IAB) UK.
Publishing its findings in The State of AI in Advertising, the IAB reports that 74% of its members are now using agentic AI, although only 4% would currently describe themselves as ‘agent-first.’
Yet the same survey finds that this latter percentage could change quickly, with 63% of IAB members expecting an “accelerating or transformative shift” within the next 12 months in how advertising content is created.
