AI integration overwhelmingly prevalent in digital advertising, IAB Europe announces, with a staggering 85% adoption rate
In a groundbreaking move, IAB Europe has released its first comprehensive report on the use of artificial intelligence (AI) in digital advertising. The report, released on September 18, 2025, offers insights into current adoption patterns and emerging challenges across multiple stakeholder types and European markets.
The study, conducted between July and August 2025, involved 95 companies across various European markets. The report found that 85% of companies in the digital advertising ecosystem already deploy AI-based tools for marketing purposes. Targeting and content generation lead in adoption patterns, with 64% and 61% of respondents respectively using these functions.
However, the report also underscores the need for clear frameworks, ongoing training, and responsible deployment of AI in digital advertising. Buy-side guidance remains inconsistent across the industry, with only 32% of companies receiving AI guidelines from clients. User data policies for AI training remain divided across the ecosystem, with 43% of companies prohibiting the use of user data for AI model training.
Privacy emerges as the primary concern regarding AI usage in digital advertising campaigns, with brand safety following closely as a concern. Performance benefits vary significantly across market segments. Ad tech firms report the strongest results, with 60% citing KPI improvements from AI adoption.
The report comes as the digital advertising industry grapples with rapid technological change, consumer trust, and regulatory compliance. The regulatory landscape presents both challenges and opportunities for companies in the digital advertising ecosystem. Approximately 60% of respondents have assessed or are currently evaluating the EU AI Act's impact on their operations.
IAB Europe's report also highlights the urgent need for addressing governance gaps, skills shortages, and regulatory uncertainty to realize AI's full potential across European digital advertising. Third-party auditing of AI tools remains limited, with only 16% of companies conducting external assessments of their AI systems.
The report also mentions the European market with the highest number of companies using AI-based marketing tools is Germany, where about 36% of companies use AI. Marketing and communication are a dominant application area, involving 57% of AI-using companies.
In an effort to address these challenges, IAB Europe's AI Working Group plans to develop a Guide to Prompting for Digital Advertising and collaborate with publishers on content access issues. The group also intends to address growth, guardrails, and policy frameworks for artificial intelligence deployment, as previously addressed in an IAB Europe AI whitepaper.
Eighty-one percent of respondents expressed interest in advertising on consumer-facing AI platforms. Training initiatives attempt to address skills gaps hindering broader AI adoption, with 60% of companies providing AI education to marketing personnel.
The digital advertising industry has seen significant investment in AI, with McKinsey's analysis revealing $124.3 billion investment in 13 frontier technologies driving marketing transformation. The report represents a significant step towards understanding and navigating the complex landscape of AI in digital advertising.
Most respondents selected German, with 51% completing the survey in that language compared to 44% in English. The report is a testament to IAB Europe's commitment to fostering a responsible and sustainable digital advertising ecosystem. Three-quarters of respondents plan to maintain or increase their AI investment, with no companies planning reductions.
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