The gap between how advertising executives and consumers view AI-generated ads has widened to 37 points in 2026, according to research from IAB conducted with Sonata Insights. The study found that 82 percent of ad executives believe Gen Z and Millennial consumers feel positive about AI-generated ads, nearly double the 45 percent of consumers who actually report feeling that way.

That perception gap has grown from 32 points in 2024 to 37 points in 2026, indicating that industry assumptions and consumer sentiment are moving apart rather than converging. Awareness of AI in advertising has risen sharply, with 71 percent of Gen Z and Millennial consumers saying they believe they have seen an AI-created ad, up from 54 percent in 2024.

Greater awareness has not improved sentiment. The share of consumers feeling positive about generative AI in ads slipped slightly from the prior study, while the share feeling negative rose 12 points from 2024. Gen Z consumers registered stronger negative sentiment than Millennials, with 39 percent reporting negative feelings, nearly double the Millennial figure.

The research drew on a survey of more than 500 Gen Z and Millennial consumers and 100 advertising executives. The widening divide prompted IAB to release a transparency and disclosure framework aimed at guiding how brands label AI-generated content. The data quantifies a challenge that surfaced repeatedly in 2026 as brands faced backlash over AI-generated campaigns.

Source: IAB - https://www.iab.com/insights/the-ai-gap-widens/