Agencies are notorious for jumping on trends quickly. Sometimes that’s a good thing, like when a new social media platform comes out and takes over the world.
Other times, that’s a bad thing. The Ozy Media fiasco is a prime example.
When news broke last week that Ozy co-founder Samir Rao allegedly impersonated a YouTube executive on an investor call with Goldman Sachs to talk up the company's viewership figures, many in the media world were not surprised. I saw countless tweets from journalists, observers and executives who always suspected something about the business’ reported figures just didn’t add up.
Despite open suspicion of Ozy and past reporting on its inconsistencies, agencies were quick to prop the company up as a poster child for a new feel-good industry trend: diverse-owned media investment.
In April, GroupM named Ozy as a preferred media partner for its responsible investment framework, which pledges to help clients direct budgets toward properties that uphold brand safety, data ethics, DE&I, responsible journalism and sustainability. The partnership included custom videos, audio and written content for GroupM clients, who in turn “get exposure to Ozy’s growing premium audience of 75 million-plus curious, forward-thinking millennials, GenX and GenZ’ers,” according to a press release.
Prior to launching its economic empowerment offering in May, Dentsu entered a three-year partnership with Ozy in March, which included a similar offering of co-created video, audio and written content for clients. At the time, Dentsu said it viewed Ozy as a “forward-thinking media partner that can help clients forge meaningful connections with diverse millennial and Gen Z consumers.”
I can only imagine Ozy was on the roster of other big agencies as they put together their own diverse media strategies. After all, there’s a limited amount of diverse-owned supply in the market, and Ozy was a high-profile example with a charismatic founder and an (allegedly) attractive audience.
Until it all came crashing down. Just days after the Times’ story broke about Ozy’s peculiar conference call, advertisers including Ford, Airbnb, Goldman Sachs and Target pulled their campaigns. Ozy lost a board member, investors and a star journalist, in addition to roughly $5 million in booked revenue. Both Dentsu and GroupM terminated their partnerships with Ozy and suspended campaigns currently running for clients.
It was a stunning reversal for a company that was heralded just a few months ago as the face of a revolution in the industry to allocate media budgets more equitably. And for agencies, it begs the question: where was the due diligence on vetting Ozy’s audience?
Digital media severely lacks transparency and there are constant issues around reporting, measuring and verifying that what companies are selling is real. But what does it say when two of the world’s largest media-buying behemoths fall for junk traffic and smoke and mirrors?
The push for diverse-owned media investment is not just well-intentioned; it’s a necessity as U.S. demographics rapidly change, and consumers start voting with their wallets. But perhaps in their quest to make fast progress, agencies left due diligence on the sideline in the interests of snagging a quick win.
As I mentioned before, there is not enough diverse-owned media supply in the market to satisfy large advertisers’ audience needs, and getting into bed with Ozy — and heavily publicizing it — seems like it was too easy to pass up.
As Andrés Rincon, SVP of east coast sales at Hispanic and female-owned bilingual OTT network Canela Media told me when the diverse-owned media investment chatter picked up in May: “It will be interesting to see who is doing it because they want to support the cause, as opposed to just checking the box.”
I really hope the Ozy let-down pushes agencies to vet their partners more carefully, especially in such an important area as diverse-owned media investment.
This is too critical of a shift to just check the box.