How do brands measure ROI from TV advertising?

Typically For brand awareness they would utilize what’s called a “pre and post awareness study.” While it can be done online it is typically done via phone surveys – random (but in the target demo for the brand) individuals in the area (national or local) that the media professionals runs (or is most important to the brand) are called before and after the media runs and asked questions that indicate their knowledge or lack thereof of the brand and/or product attributes. The difference between the awareness etc post the media running indicates the lift that the media had on them. It is up to the brand to determine if that lift was worth the money (had a positive ROI). They also measure sales lift through indirect channels – but that’s a lot harder to attribute solely to the TV.

As to “justifying the cost,” brands usually set awareness lift goals for themselves that they can use to, over time, calculate the increase in sales that a certain amount of lift in awareness will create. In this way they can calc an ROI. But TV advertising is a must for many brands – no TV, no awareness, no sales, dead or declining brand.