The Interactive Advertising Bureau (IAB) has unveiled a new industry guide and roadmap designed to elevate the performance and measurement capabilities of Connected TV (CTV) advertising. This initiative focuses on developing Conversion APIs (CAPI) for the CTV ecosystem, aiming to bolster measurement accuracy, enable privacy-safe data collaboration, and ultimately drive better performance outcomes for advertisers.
The guide directly addresses the inherent challenges within the CTV landscape, such as extensive fragmentation, limited identifiers, and technical barriers. These issues, if left unaddressed, could impede future growth, especially as marketers increasingly prioritize performance-driven strategies. By establishing a common framework, the IAB believes CTV ads can achieve the same level of accountability and performance as established digital channels like social media and search advertising.
Bridging the Performance Gap in CTV Advertising
Despite its significant promise as an advertising medium, CTV currently lags behind its digital counterparts, search and social, in demonstrating clear, measurable return on investment (ROI). The IAB's research highlights a critical concern: without a robust method to prove ROI, CTV risks reduced demand from advertisers who are actively seeking platforms that can deliver transparent results and accountability.
"As advertisers shift toward outcome-based buying, platforms that can't prove results will be deprioritized," states the executive summary of the report.
This trend is already evident, with the IAB's 2025 ad spending forecast indicating that marketers are reallocating budgets to media channels where spending can be more directly linked to results. Nevertheless, the IAB projects substantial growth for CTV, forecasting CTV spending to exceed $72 billion in 2025, with digital video accounting for 58% of all video ad spend.
CAPI: A Solution for Enhanced Measurement and ROI
The IAB's guide, informed by extensive research from both buy-side advertisers and sell-side publishers, provides a framework to standardize CTV reporting. This includes a survey of brands, agencies, publishers, and technology leaders across the industry, addressing concerns and recommendations from all stakeholders.
On the buy side, nearly two-thirds of advertisers currently utilizing CAPI report an improved return on ad spend (ROAS). This includes more complete conversion data, stronger attribution, and more efficient optimization. Most of these advertisers integrate CAPI into a hybrid measurement strategy, combining it with pixels, SDK integration, and third-party attribution tools for enhanced resilience and redundancy.
Overcoming Barriers to Adoption
Despite the clear benefits, widespread adoption of CAPI faces significant hurdles. The primary barriers include the complexities of integration, compliance challenges, and a general lack of standardization across the ecosystem. Privacy concerns also loom large, with over 70% of advertisers expressing reservations about sharing data due to competitive sensitivities and fears of misuse.
"The implication is that for CAPI to scale, the ecosystem must collectively address both the technical and trust gaps—streamlining implementation while embedding privacy-first frameworks that instill confidence in data sharing," the report emphasizes.
The report urges advertisers to align internally on their measurement needs and actively push their publishing and technology partners to adopt these new standards. Publishers, according to the IAB, have shown willingness to implement a standardized CAPI framework but are awaiting a clear direction on its precise form.
Publishers' Role in Driving Transparency and Performance
While awaiting a standardized framework, the sell-side can proactively enhance transparency and conversion tracking. IAB research indicates that only 21% of publishers consistently provide advertisers with access to logs or dashboards, while 18% do so sometimes, 36% never, and a quarter remain unsure. This fragmentation creates friction for advertisers attempting to validate performance and troubleshoot integrations.
Furthermore, while publishers are proficient in tracking bottom-funnel actions like sign-ups and purchases, they often lack experience with mid-funnel events such as cart abandonment, logins, and searches. These mid-funnel insights are crucial for effective remarketing strategies and gaining a richer understanding of the consumer journey.
