How McDonald’s, P&G, Coca-Cola, GM and other big brands are spending on Black-owned media

Since 2020, dozens of advertisers have pledged to increase spending with Black-owned media. And despite fears that those commitments would be forgotten by now, a survey of Black-owned media companies from Ad Age tells a different story, though performance varies widely by company and brand. Spending with Black-owned media is on the rise, up in 2022 vs. 2021, for most big brands and agencies, according to a survey of seven Black-owned media companies that provided data in exchange for anonymity. The data shows that many of the brands that have made public commitments—including Target, Walmart, Procter & Gamble Co., Coca-Cola Co., General Motors and McDonald’s—have made marked progress, though the degree to which that’s happening is subject to some debate among media owners. Check out the latest Ad Age events and award programs Overall, Ad Age received responses from seven Black-owned media companies with data from spending by their biggest brands and agency customers. Not all of the media companies reported dollar figures by brand or agency. And, in some cases, the data was limited to directional indicators, so the results cannot be taken as exact spending by brands or representative of the entire marketplace. But in general, all respondents showed more brands or agencies increasing rather than decreasing spending, with some reporting dramatic increases in 2022, albeit off low bases. The data from the Ad Age survey and other sources suggest marketer commitment to spending on Black-owned media, which was sparked by the unrest following the 2020 murder of George Floyd, continues to grow. Such measurement is complicated in part by the fact that some marketers, such as Verizon and Procter & Gamble, have focused on programmatic buying of Black-owned media where possible, while some Black-owned publishers have resisted programmatic deals and tried to preserve their direct relationships with agencies and brands. This has ignited a debate as to whether programmatic is a move toward efficiency and more spending or just a way to cut costs. Progress broadly Across a wider swath of brands, spending on Black-owned media has been rising at a healthy clip, according to a recent study out of the Association of National Advertisers’ Alliance for Inclusive and Multicultural Marketing based on data from Standard Media Index. SMI, which compiles actual spending data from holding companies and leading independent media agencies, found spending with Black-owned media companies nearly tripled since 2020 to $880 million. And spending on Black-owned media made up 62% of the spending on diverse-owned media in 2022, even though Black-owned companies only made up 47% of diverse-owned outlets. Overall, spending on diverse-owned media rose at an 80% annual rate from 2020 to 2022, from $400 million to $1.4 billion, according to the AIMM/SMI data. It rose well ahead of media spending overall, up at only a 9% annual pace on average across the two years. Even as overall SMI-measured spending was nearly flat in 2022, spending on diverse-owned media rose by more than 50%. Despite that growth, spending on all diverse-owned media made up only 1.85% of total spending measured by SMI in 2022, and spending on Black-owned media comprised only 1.16%. But those shares were each more than double what they were in 2020. For some big brands, however, public spending commitments are double or more than broad market averages. Here is how some of the biggest brand marketers that made high-profile pledges are performing. Target Target appears to have had the most aggressive goal for spending with Black-owned media companies last year, aiming to spend at least 5% of its media budget with them by 2022. The retailer also stands out as having the highest spending total among respondents to the Ad Age survey that reported dollar spending, hiking spending with one marketer alone by $9.4 million in 2022. Target had measured media spending of $1.5 billion last year, per Vivvix supplemented with digital spending data from Pathmatics. So 5% would come in at $75 million overall in 2022 by that accounting. Without citing spending numbers, a Target spokeswoman said the retailer exceeded its 2022 goal. “Our commitment to supporting Black-owned media companies allows us to reach our guests through platforms that are hyper-relevant to them and to be a catalyst for change in the media industry,” she said. “We remain committed to our industry-leading pledge to spend 5% of our annual media budget with Black-owned media companies.” General Motors General Motors came under fire in 2021 for what several Black-owned media leaders said was the refusal by its CEO to meet with them and for allocating less than 0.5% of its ad spend to Black-owned media. Shortly after, the automaker announced it would spend 2% of its ad dollars on Black-owned media in 2021 and 4% in 2022, with the goal of reaching 8% by 2025. At one major media group, GM upped its spend by 125% in 2022 to just under $5 million and invested in the development of series, as well as impact-driven IP. It also bought into at least one Black-owned media brand for the first time in 2022. “There is nothing but check boxes here for us with GM,” the leader of a media company who notes GM as a new advertiser said. For this brand, GM also has paid within 30 days, while most of its other advertisers have payment terms that stretch between 90 to 120 days. Overall, GM spent nearly $1.4 billion on media last year, as estimated by Vivvix and Pathmatics, which would indicate spending of around $56 million overall with Black-owned media based on its 4% target. Still, there are some issues with working with GM, according to survey respondents. “At a national level doing what they are doing, but at the dealer level they don’t control all the money,” one Black-owned media leader said. Another expressed a bottleneck with getting deals done. “We get a lot of interest from them in terms of participating in Black media day, we submit an RFP and then they come back with feedback and we tweak it and we think we are getting to the finish line, then there are delays in approvals and weeks go by and then we are told we were not selected. This has happened for the past two years. This will be the third year, and we will most likely opt out until we get engaged with directly.” A GM spokeswoman said the automaker has exceeded its investment goal for Black-owned media of 2% in 2021 and 4% in 2022 on the way to reaching a goal of 8% by 2025. GM also exceeded its goal last year of spending 10% of its annual media budget on diverse-owned and targeted media in 2022, she said, adding that it increased investment with Hispanic, Asian, LGBTQ+ and female-owned companies. McDonald’s Facing two lawsuits from Allen Media Group alleging racial discrimination in its media buying, McDonald’s has been under arguably the most intense scrutiny of any advertiser over its spending on Black-owned media. Media mogul Byron Allen is seeking $100 million plus punitive damages in the most recent lawsuit filed earlier this month for what he claims is a violation of California’s anti-fraud law against making false promises. This comes on top of another lawsuit Allen made against McDonald’s, in which he claims the company’s ad practices amount to “racial stereotyping.” The world‘s largest restaurant company has strongly denied all of Allen’s allegations, and the lawsuits remain pending. “Byron Allen files baseless lawsuits as part of a public smear campaign against our company to try to line his pockets,” McDonald’s said in a statement. “We will not be coerced by these ‘in terrorem’ tactics and will defend ourselves vigorously.” Indeed, McDonald’s spent nothing with Allen’s The Weather Channel in 2021 or 2022, per Vivvix. But the company increased its spend more than 70% to $3.4 million on one Black-owned channel and funded additional programs. And another survey participant also noted a 70% increase in McDonald’s ad spend, but declined to provide a revenue figure. That media company noted that McDonald’s helped to build out infrastructure and IP and its payment terms were 45 days, lower than every other advertiser at the company. “What is unique for us, McDonald’s didn’t just invest in terms of the dollars being spent, but looking at how they can make us bigger and better,” the executive said. “We have a monthly meeting with some of the McDonald’s team, a quarterly meeting with a larger group, and I meet personally with Tariq [Hassan, chief marketing and customer experience officer] every six months. We appreciate that process and level of access.” One of McDonald’s challenges, similar to General Motors, is the divide between the national budget (controlled by Hassan) and the local budget driven by franchisees. “Any time McDonald’s is making pledges, it’s at a national level,” one survey respondent said. “They surpassed goals, made stretch targets and are hitting those.” McDonald’s did decrease spending with one survey participant, but it is unclear how much revenue was pulled out. In May 2021, McDonald’s promised to more than double its U.S. investment in diverse-owned media companies, production shops and content creators by 2024. It also said during that period it would increase its U.S. advertising spending with platforms owned by Black, Hispanic, Asian American, female and LGBTQ people from 4% to 10%. When it comes to specifically Black-owned media it pledged to increase its spend from 2% to 5% by 2024. McDonald’s is confident enough in progress toward the 2021 targets that it increased its “systemwide investment ambition with diverse-owned media to 15% by the end of 2024,” a spokeswoman said. “As part of this, we are on track to meet or exceed our commitment of 5% of total Black-owned marketing investments by 2024.” The company plans to update progress toward its goal in a July report. Procter & Gamble P&G has never made a firm dollar or percent-of-spending commitment on Black-owned media, but Chief Brand Officer Marc Pritchard has repeatedly said, as he did in a 2021 speech to the ANA Masters of Marketing conference, that he wants the company to be “the number one spender among Black-owned media.” Pritchard also said P&G had doubled spending at that point from the prior two years, “and our aspiration is to double again, and then double again.” But survey respondents note P&G isn’t close to leadership levels of spending among brand marketers. P&G did increase spending with four of five Black-owned companies that broke out data, but the increase was only 5% with one of those. And P&G ranked around the middle of the pack in spending among companies that broke out dollar figures. “For how much Marc Pritchard gets credit for [DE&I] they don’t spend much with us,” one survey respondent said. “It’s their aspiration is to be the No. 1 spender in Black-owned media and in order to do that they would need to give us a lot more money. They are over hyped; the amount of credit they get in the market you would think they are our No. 1 advertisers, but they aren’t, they are like 30th.” That does not, however, tell the whole story. The company did rank No. 4 among spenders on Allen’s TWC last year, hiking spending 42% to $5.4 million, per Vivvix. P&G has also heavily invested in programmatic buying of Black-owned media, including through Black-owned Reset Digital, which may not show up in the Ad Age survey and covers a much broader group of media companies. Damon Jones, chief communications officer of P&G, didn’t confirm the Vivvix data on TWC, but noted that the company also increasingly spends on other Allen properties in ways that don’t show up in measured media, including event sponsorships, TheGrio Awards and the company’s other cable and digital networks. Much of P&G’s efforts also have included co-developing content with Black creators, he said. “Our aspiration has been to double our spending, which we’ve done over the past couple of years, which we feel very good about achieving,” Jones said. One challenge has been finding sufficient capacity in the industry, he said, so P&G has been looking beyond the biggest Black-owned companies. “There’s a long tail of companies where we’ve been spending a significant amount of time, effort and energy to bring them into the ecosystem, give them exposure to the opportunities with P&G, and get them plugged into programmatic systems that will allow advertising to flow on different levels,” Jones said. Just recently, he said, P&G hosted brand briefing days with 75 diverse publishers in Cincinnati. P&G’s spending on radio also surged 48% last year to $254 million, per Vivvix, out of an overall outlay of $3.2 billion (also including Pathmatics digital spending data). While neither P&G nor Vivvix broke out spending on Black-owned radio stations, that’s one part of the “long tail” where the company’s spending clearly has grown. ANA’s AIMM database shows 31% of Black-owned media companies are in radio. People familiar with the matter said some of the bigger Black-owned media companies have resisted selling inventory programmatically to P&G or others, preferring to preserve their direct relationships with advertisers. “Different people are in different places,” Jones said. “In order to get plugged into those programmatic systems, we recognize there are barriers, investment required and knowledge and capability needed. We’re resisting a one size fits all approach. There are some people for whom programmatic is the number one way, and so we’re investing to help build their capacity and the infrastructure to get there. But not everything is programmatic.” Another survey respondent said, “I think the team is great and has great intentions,” but that so far P&G spending has been minimal—only around $200,000, despite the media company taking steps to integrate with sell-side platform Magnite. While this executive has heard more commitments could be coming, it hasn’t happened yet. Another person familiar with the matter said P&G has a large group of brands looking to expand buying with Black-owned media this year. Upfronts and NewFronts blog Tracking the latest TV and digital ad pitches Read more here Verizon Verizon is one company for which public pronouncements about spending more on Black-owned media are at odds with the results of the Ad Age survey. But the devil is likely in the programmatic details, where much of the company’s spending on Black-owned media appears to have shifted. Speaking at last year’s ANA conference, Verizon's Senior VP Tony Wells said: “Since the murder of George Floyd, thousands of brands have committed billions of dollars” to Black and diverse-owned media. “The question,” he said, “is are we as committed now as we were?” Based on the Ad Age survey data for Verizon, four out of five respondents that broke out spending by brand reported Verizon reduced its spending in 2022, and in some cases completely eliminated its investments. One media company did report Verizon increased spending and inked a long-term deal, but did not provide additional details. Wells, however, did note in that same speech a number of efforts that included a deal with Reset Digital to use its Neuroprogrammatic Advertising platform to find diverse audiences that it’s been missing with prior targeting efforts. At least some, and possibly all, of the spending Verizon had been doing directly with media companies, could have moved to Reset and other programmatic channels to buy from Black-owned companies. But Verizon’s strategy has left executives of some Black-owned media companies disappointed and angry. “Programmatic is a race to the bottom,” said one. “We are seeing some brands trying to find an easy button and cheapen what is happening in the Black-owned ecosystem. People are going to stop buying directly and try to spend more in programmatic. They are saying it is to control for frequency, planning and duplication, but it is all about pricing.” One agency executive said he’s also encountered resistance from some Black media owners to move to programmatic. “But they need to be comfortable with the fact that at least 30% of an agency's spend is happening through programmatic,” he said. “We have some partners that said no to programmatic, and we respect their decision. … But I want to be clear that they’re losing here. They’re leaving some money on the table that somebody else is going to take.” Another survey respondent said their company was part of Verizon’s Black media days twice but never heard back, including on a more recent RFP. Another Black-owned media executive said Verizon made a commitment and announced a multi-year deal, “then they started pulling everything. We fought hard and ultimately they still decided to do it. It left a bad taste in my mouth. They said they were having budget cuts. There is not enough Black-owned local inventory. No way they were able to invest as much as they did in national.” Verizon pledged in April 2021 to spend 2% of its ad budget on Black-owned media. In January 2022, the company reported it was “on track to exceed” the $25 million it previously committed to spend with Black-owned media companies in 2021. “Today we work with 20-plus Black-owned and operated media partners, from well-known traditional platforms to digital and emerging platforms,” said Rafael Rivero, senior VP, media and marketing effectiveness, Verizon. “These partnerships help us achieve our business objectives, and in many cases help our partners scale.” Rivero added that Verizon exceeded its commitment to Black-owned media in 2021 and increased that spending by 20% in 2022. Coca-Cola In June 2021, Coca-Cola announced it would double its media spend with minority-owned companies over the next three years, with no less than 8% of its yearly budget directed to Black, Hispanic and Asian-owned platforms and their partners by 2024. All five Black-owned media companies that provided brand-specific data reported Coca-Cola increased spending last year, one noting it hiked spending by $1 million and another citing a 160% spending increase. But survey respondents reported mixed results since Coca-Cola moved its media account from Interpublic to WPP’s EssenceMediacom last year. One executive said Mediacom reached out proactively during the transition. But another said the transition varied according to property. “I love Coca-Cola,” said one survey respondent. “They were one of our best brands.” But after it moved to WPP last year, he said, “we got zero dollars.” As a matter of policy, Coca-Cola doesn’t share specific numbers around media spending, a spokesman said, but added that it is “on track to meet our commitment of having our Black, Hispanic and Asian American and Pacific Islander-owned media companies account for 8% of our total annual media budget in North America by 2024.” This, the spokesman added, includes spending with Ebony and Essence, on things such as the Essence Festival of Culture that Coca-Cola will be sponsoring for the 27th year this summer and the Coca-Cola Zero Sugar Presenting Sponsorship of the 2023 Ebony Power 100. Walmart In Ad Age’s survey, three of five Black-owned companies that reported spending at the brand level said Walmart increased spending and a fourth reported a decrease. Among companies reporting dollar figures, Walmart’s spending rose $1.6 million with one last year, while another reported a 150% increase. Walmart in May 2021 pledged to spend 2% of its media with Black-owned companies in fiscal 2022 and 4% in fiscal 2023, and hit both of those targets, according to a spokeswoman (both fiscal years ended Jan. 31). Dollar figures weren’t disclosed, but Walmart spent an estimated $2.5 billion on media as measured by Vivvix and Pathmatics in calendar 2022, up about 20% from the prior year. It’s less aggressive than Target has been, but also off of a bigger spending pool. Results were very mixed by company. One reported that it lost all its Walmart spending; Another saw a nearly fourfold increase. One survey respondent described Walmart as “dedicated and committed” and issuing many RFPs. “We don’t win all of them,” the respondent said. “But we seem to always be included.” One agency executive, who spoke on background, said the agency was trying to ensure budgets for Black-owned media stay strong by pushing clients to establish dedicated budgets and include at least one minority company on every RFP. Clients who were already “leaning in” continue to do so, while clients who haven’t “are slowly joining as well,” the executive said. But a worrisome trend is with clients trying to shrink the number of partners they work with, the executive said. “There’s always this mentality of fewer, bigger, better. I think in the minority space, that’s not always the case, because you want to see more opportunity growth.”

How McDonald’s, P&G, Coca-Cola, GM and other big brands are spending on Black-owned media

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