TV Ads Don’t Work Nearly as Well as Believed

Why It Matters

Inflated effectiveness estimates cause wasted advertising budgets; accurate ROI data enables smarter media allocation and targeting.

Key Takeaways

• TV ad effectiveness overestimated by 55% in food‑delivery study
• Linear TV ad spend $139 B, far exceeding $33 B streaming spend
• Smart‑TV data links viewing seconds to actual purchase behavior
• Young sports fans and repeat buyers respond strongest to TV ads

Pulse Analysis

Even as streaming platforms gain traction, linear television remains the heavyweight of ad spend, with $139 billion poured into traditional spots compared with $33 billion for streaming and connected‑TV placements. The industry has long relied on Nielsen ratings and aggregate market data, metrics that capture audience size but lack the granularity to tie exposure to individual buying decisions. This opacity makes it difficult for brands to gauge true return on investment, often leading to optimistic assumptions about campaign performance.

A breakthrough study from Notre Dame’s Mendoza College of Business leverages LG smart‑TV data to track exactly what households watch, second by second, and matches that with food‑delivery app usage. By treating the random timing of ad slots within live broadcasts as a natural experiment, researchers isolated the causal impact of TV ads, revealing that traditional measurement methods overstate effectiveness by roughly 55%. The analysis also identified high‑response segments: tech‑savvy sports fans and customers with two to four prior orders showed the strongest lift within two days of exposure.

The implications are immediate for marketers allocating billions to TV. With clearer insight into which placements actually drive sales, advertisers can reallocate spend toward more measurable channels or negotiate better rates for premium inventory. Moreover, the ability to target ads based on real purchase behavior—rather than broad demographics—brings digital‑level precision to the television arena. As smart‑TV adoption grows, this data‑driven approach is poised to reshape media planning, forcing the industry to adopt more rigorous, ROI‑focused measurement standards.