Minority spending commitments are just the beginning

Agencies and brands have a lot to live up to with diversity upfront commitments.

Finally, money is moving in the right direction.

Over the past few weeks, holding companies including IPG and WPP, as well as brands such as Verizon and General Motors, have made public commitments to invest more upfront dollars with minority-owned media companies.

This is a great step for the industry and pretty remarkable, given that diversity and inclusion has generally not been a prominent conversation around the spring TV buying season, beyond simply targeting multicultural audiences.

Generally, marketers are looking for the best deals on the largest networks with the most reach, which they typically get by buying with the same media companies they’ve always bought from. Advertisers are able to lock in better deals with media owners they’ve worked with for years in the past, closing off the pool of partners even further.

This year, something different is happening. The conversation about DE&I has gotten so loud in the industry that advertisers are putting inclusivity ahead of pricing (well, maybe).

IPG Mediabrands will commit a minimum 5% of aggregate client spending toward Black-owned media companies by 2023. WPP’s media investment behemoth GroupM called on its clients to spend at least 2% of their annual media budgets on Black-owned media by 2022. And, after a bit of public shaming, GM said it will allocate 4% of its media dollars to minority-owned outlets this year, and grow that commitment to 8% by 2025.

Advertisers aren’t doing this simply because it’s right. As Dani Benowitz, U.S. president at IPG’s Magna media unit pointed out to me this week, Black audiences alone have $1.4 trillion of buying power in the U.S. “[They are] young, affluent, cultural influencers — all of the reasons you would want to talk to an audience,” she said.

The key to these programs is their focus on minority-owned media companies — not just minority targeted media. Investing with companies that have deep ties to their communities not only creates opportunities for more authentic messaging, but also builds wealth among minority groups, said Andres Rincon, SVP of east coast sales at Canela Media, a Hispanic and female-owned bilingual OTT network.

“Sometimes, marketers and agencies tend to confuse the two,” he said. “We're not a sub-vertical within a bigger platform. We are 100% a platform and built for U.S. Latinos. We are also working closely with organizations that are supporting our communities.”

This year, agencies and large brands are proactively reaching out to Canela more than ever to ink upfront deals, Rincon said. “For the most part, you do get that meeting, whereas in the past you would knock on their door with no response.”

But for advertisers used to working with the same partners every year, visibility can be an issue. It’s why IPG Mediabrands hosted its first equity upfront this year, and will continue to hold meetings with minority-owned media owners throughout the year. In addition to getting on marketers’ radars, Mediabrands is helping small media owners navigate the RFP process and integrate with Acxiom and IPG’s planning tools to make them more accessible.

“Usually these conversations happen with the bigger networks and platforms, and by the time they get to minority-owned folks, there is barely anything left in their budget,” Rincon added. “It's important for agencies to give minority owned companies a seat at the table from the very beginning.”

Visibility, however, can only get us so far. The pie of Black and minority-owned media impressions available is only so large — and if all holding companies start making the same commitments, that inventory will soon run out.

That’s why GroupM has added an accelerator program to its minority investment pledge, in which it will directly invest in Black creators to grow their audiences and give them more exposure to brands.

“The problem is not splitting up the existing pie. It's growing the pie,” GroupM CEO Christian Juhl explained to me. “Amplifying diverse voices on platforms like TikTok, Instagram and Snap, where they really have a chance to build their own brands and succeed, is a huge opportunity.”

But the work is only just beginning. Marketers will now have to actually carry out spending more with these companies to meet these goals, and continually improve on commitments in the years to come.

Both GroupM’s and IPG Mediabrands’ commitments are suggestions, but at the end of the day clients decide where to spend their money. Who’s to say they won’t still go for general market media based on availability and price?

“They have to reset their goals around sustainability, DE&I and ethical use of data,” Juhl said. “All of our clients recognize that long-term, strategic goals include a different basis of measurement.”

For these programs to work, minority-owned media companies, especially smaller ones, are looking to be treated fairly in negotiations — rather than squeezed for better deals and more added value.

“It's great these conversations are happening. However, we have yet to see the actual results,” Rincon said. “It's like all of a sudden everyone just woke up and said, ‘Oh my god, we must support minority-owned companies.’ It will be interesting to see who is doing it because they want to support the cause, as opposed to just checking the box.”

To Rincon’s point, this industry does a great job of talking about its intentions and commitments. Following through is the hard part. 

I truly hope this time, after the year we’ve all had, this movement marks the start of a more permanent shift towards equity.


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