Some in the ad business may resent the suggestion that this may be happening, and dismiss it as baseless government handwringing. But it is not an issue that can be wished away. Top managements at advertisers and agencies have a duty to scrutinize media buying for any hint that bigotry is affecting buying decisions, and promptly take any corrective actions necessary. This question cannot be allowed to fester.
The advance billing on a report being prepared for the Federal Communications Commission says it will show that stations with similar ratings and sometimes nearly identical programming formats get widely different ad revenues depending on whether they were minority-owned or not. Kofi Ofori of the Civil Rights Forum, who is compiling the report, said he has found white-owned broadcasters get 30% more revenue than minority broadcasters when both have minority-formatted stations. It's not surprising those sorts of assertions prompt people outside advertising to ask why this would be so.
Advertisers have no specific obligation to use their media budgets to support government policy to encourage minority ownership of media. Those dollars first and foremost must further marketing ends; they go to media companies that efficiently and effectively deliver the desired audience for ad messages. But advertisers -- and agencies -- do have an obligation to fairly and accurately value minority audiences; to see that racially inspired stereotypes play no part in that valuation; and to insure that all media -- regardless of ownership -- are honestly compensated for value received, without consideration of race.
There's no room for a double standard. Period.
Good for GM?
As our 100 Leading National Advertisers report in this issue shows, General Motors Corp. last year toppled Procter & Gamble Co. from the top of the chart. But to what end?
GM's tally of $3.09 billion in advertising, up 29.9%, made it the first marketer to have cracked $3 billion. Not since 1962 has GM occupied the driver's seat in the annual ranking; P&G virtually has owned the top spot since then, giving way to just a couple of other marketers for brief periods.
But sheer ad volume can't compensate for brand indistinction. And the sad facts are that while GM was spending so heavily on advertising, its 4.7 million cars and trucks sold in U.S. in '97 was down from '96. The figures mean it spent $655 on advertising for each new vehicle sold. Also, its share of the U.S. market slipped to 31.09%, from 31.33%. For a comparison GM probably doesn't want to be reminded of, its share of market in 1962, the last year it led U.S. advertisers, was 51.07%.
What moved the automaker ahead of P&G last year was actual media spending, accounting for nearly 73% of GM's total expenditure, or $2.26 billion. GM was the top advertiser in magazines ($588.4 million, up 28.9%) and network TV ($819.3, up 33.5%), and second largest in spot TV ($373.8 million, up 30.3%) and cable TV ($174.8 million, up 49.9%). It was third largest in national newspapers and syndicated TV.
Without the right products, it just goes to show: What's good for media is not necessarily good for General Motors.