Too Few Diversity Dollars on Madison Avenue

Progress Is Being Made, but 'Shoestring' Budgets Spread Out Over Uncoordinated Efforts Hold Back Improvement

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NEW YORK (AdAge.com) -- The ad industry has grown a little more comfortable talking about a diversity problem as old as the industry itself, but is it putting its money where its mouth is? The good news: Money is flowing into diversity efforts. The bad news: Critics describe it more as a trickle -- and one so spread out it dissipates before it can make a long-lasting impact.

The efforts look like a lot on paper and include roundtables with clients on the intricacies of minority markets, executive councils, training, recruitment, partnerships with minority universities and programs from most of the leading trade organizations.

"I'm happy you're interested in what we're doing, not what we're not doing," said Sandra Sims-Williams, chair for Publicis Groupe's diversity council. Publicis Groupe sends dozens of employee women of color, as well as some clients, to a conference to develop leadership skills. Add to those commitments executives' time and providing space for diversity programs.

But recruiting programs and professional-development courses have been around since the 1960s. And still, civil-rights lawyer Cyrus Mehri has rustled up enough instances of discrimination to file charges with U.S. Equal Employment Opportunity Commission, a step toward a class-action suit against the ad industry.

So why are the programs falling? It might have to do with money.

Coming up short
In December, Howard University, in partnership with the 4A's, launched a program to train midlevel minority managers to make lateral moves into agencies. The program is under way with 27 students -- the second class was held at Grey, New York, last week and another class is slated at JWT. But all this is happening on almost half the planned budget.

The 4A's made a commitment to contribute $250,000 annually for five years to Howard's Center for Excellence in Advertising, which the university and trade organization co-founded to increase the number of African-Americans at agencies, as long as Howard could raise $750,000. Last year, the program came up short of that goal with $300,000, of which Dan Wieden alone gave $100,000. The remainder doesn't seem like too much for the Big Four holding companies to pony up, although their 4A's membership fees make up some of the 4A's contribution.

That's not to ignore that 2009 was an undeniably tough year for agencies and trade organizations. One example: The One Club ended its relationship with Julius Dunn's Adversity program designed to educate minority youth about careers in creative departments. One Club President Kevin Swanepoel attributes that split to tough economic times, though he says other diversity programs are under way.

The Marcus Graham Project launched a pilot boot camp last summer for seven black men between the ages of 18 and 34 to build skills in advertising and is also gearing up to raise money for a second boot camp, social networks aimed at mentorships and various other initiatives. Funding meetings with the Big Four holding companies haven't happened yet, but they'll need to soon.

"All these programs have been done on a shoestring budget," said Lincoln Stephens, founder of the Marcus Graham Project. "Right now we're in a crucial phase. We have interest from the audience we serve, but in order to grow, we need the right sponsorships from agencies and corporations that see a value in what we're doing."

Penalties
One reason Mr. Stephens has faith he'll find funding for his effort is he's gone out and proved his approach before seeking money from the majors. "I've done amazing things with no money," said Mr. Stephens. "I'd like to demonstrate to people what we can do if we had a budget."

Funding such groups isn't the only way holding companies and agencies are using money to tackle the diversity problem. At Interpublic, failure to meet diversity objectives on hiring, promotions and retention means cuts in executive incentive pay -- and that's meant real money lost for a number of execs.

And the holding company, while it supports other causes, sees more value in fighting the battle on its own turf. "Our agencies and IPG support the industry's many worthwhile initiatives, especially the long-term pipeline programs, but this is a fight that will be won on the agency level, where the actual hiring, retention and promotion opportunities exist. We invest substantially in our internal programs, because they make a real difference in the day-to-day lives of our people," said Heide Gardner, chief diversity and inclusion officer at IPG.

At Omnicom, BBDO's minority-education fund has meant 220 internship and scholarships totaling $885,000 since 2000, and DDB's diversity scholarship fund granted $250,000 to 50 students.

But scholarships can only go so far, especially when split up over time and large numbers of students. Consider: One quarter at Miami Ad School for art director or copywriting is $4,350 in tuition -- or $34,800 in total tuition for the two-year diploma program. Of course, there are cheaper programs to be had at city and state universities, many of which have solid undergraduate programs.

Not enough change
"People genuinely want a program like ours to succeed. Build it, and we'll come," said Adrianne C. Smith, executive director, Center for Excellence in Advertising at Howard University. "The more successful we are, the more the agencies want to help," she added. "We have support, but they don't want to do the heavy lifting alone."

Yet between the scholarships and mentoring and award shows, agency C-suites and the upper levels of creative departments don't reflect anything but the good old (white) boys club.

Can money be the only thing to blame?

"We are short on the money," said Publicis Groupe's Ms. Sims-Williams. "But even when I look at our clients that have much more money flowing into diversity, it doesn't always work."

What Ms. Sims-Williams -- and many others -- see a need for is some sort of cohesion -- or at least a comprehensive approach to the various programs available. "A solution is bringing these collective groups together to develop a full strategy," she said.

"I don't think throwing more money at [diversity] is the solution," said Nancy Hill, CEO of the 4A's. "I think it takes coordinated efforts, so that anyone that raises their hand and is talented gets mentored all the way through into agencies."

Ultimately, the money "doesn't matter unless somebody knows how to put the pieces together," said Ms. Hill.

Diversity milestones
1942 John H. Johnson established Johnson Publishing Co., now publisher of Ebony and Jet, with Negro Digest.
1952 BBDO hired Clarence LeRoy Holte to head of special markets, the first African-American at an exec level at a general-market agency.
1952 Copywriter Erma Perham Proetz, who worked for Gardner Advertising Co., was the first woman inducted into the AAF Hall of Fame.
1961 The first Spanish-language TV station in the U.S. started in San Antonio, Texas, under the name Spanish International Communications Corp, which would become Univision.
1965 H. Naylor Fitzhugh accepted a position at the Pepsi-Cola Co., where he became a pioneer in target marketing, a practice at the time called "special markets." In 1970, Ad Age named Mr. Fitzhugh one of the "Ten Who Made Advertising News in the '60s" and wrote: "The 'special markets' tag is doing a slow fade from the marketing scene. By 1980, it is hoped by people like Naylor Fitzhugh, the classification will be as obsolete as 'freedom ride' and 'lunch counter sit-in' are in 1970."
1963 The Urban League of Greater New York found that fewer than 25 African-Americans worked in creative or executive positions in ad agencies, with one-third of the top ranking African-Americans working in special markets. The 4As responded that there were 100 African-Americans employed at large New York agencies out of the industry's 20,000 in New York City. NAACP officials later met with the 4As and agency executives to present a program intended to increase black employment.
1967 The first basic advertising class for African-Americans was held in Chicago at Northwestern University and later at agencies around the city.
1968 New York City Commission on Human Rights holds hearings into discrimination in radio, TV and advertising industries. Found that among agencies, the average percentage of black employees was 3.5%
1971 Frito retired its Bandito character, created by Foote, Cone & Belding, after years of protest from Mexican-Americans.
1973 4As established its minority internship program.
1981 Burrell Advertising gets the general marketing business for Martell Cognac. This was one of the first general-market wins for a minority-owned agency.
1996 Frank Mingo became the first African-American to be inducted into the Advertising Hall of Fame. He began his career at J. Walter Thompson Co. and was the agency's first African-American account executive. He was responsible for introducing the now-iconic Lite Beer for Miller.
2003 Ann Fudge becomes the first African-American to chair major mainstream market agency, as head of Young & Rubicam.
2006 New York City Commission on Human Rights, revisiting the issue of minority employment in NYC ad agencies, finds numbers still well below that of general population and other industries. Subpoenas execs of NYC ad agencies, but hearings avoided after agencies sign agreements.
2010 Cyrus Mehri files charges against the advertising industry with the U.S. Equal Employment Opportunity Commission.

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Compiled with Jason Chambers, professor of advertising at University of Illinois, and the law firm of Cyrus Mehri.

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