Long Term Effects Reveal High ROIs of TV Advertising

Guido Modenbach and Raimund Wildner
SevenOne Media and GfK Verein

Background/focus of study

Advertisers would likely agree wholeheartedly on the value of television advertising to sell a brand. And yet we still lack truly conclusive evidence of the power of this medium when it comes to sales. The effect of TV on "soft," communicative impact indicators such as brand recognition or advertisement recall is uncontested, but the results of studies looking at the return on investment (ROI) have so far been rather disappointing: The ROI is often just 15 or 20 cents per invested euro, with anything higher already considered a successful campaign.

So it's no wonder that the call for documented results in the market has grown in recent years and that there has been an increasing focus on the subject of ROI.

But where have the earlier studies on ROI come up short? Why are the results of nearly all studies so modest when it comes to the impact of TV on sales?