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When Ross Love, former Procter & Gamble Co. VP- advertising, publicly called on the company's roster shops to diversify in 1996, he wasn't doing it to take up the cause of fellow African-Americans: He was acting on P&G's interest in building its brands in the fastest-growing segments of the U.S. population.

Ironically, Mr. Love, then P&G's highest-ranking African-American executive, dealt a blow to P&G's own diversity efforts when he retired a few months later to run the urban-format radio company he form-ed, Blue Chip Broadcasting.


But the U.S.' leading advertiser hasn't lost its commitment to diversify its own ranks or those of its agencies, says Robert Wehling, senior VP-advertising, marketing and government relations. For P&G and other marketers, diversity has gone beyond the stage of regulatory compliance or window dressing to become a matter of brand survival.

"I don't know how you can effectively market to the melting pot that this country represents without a work force and vendors who have a gut-level understanding of the needs and wants of all of these market segments," says Mr. Wehling. "When we started getting a more diverse work force. . .we started getting richer [marketing] plans, because they came up with things that white males were simply not going to come up with on their own."

Though the executive suite at P&G's Cincinnati headquarters remains filled mostly with white males, Mr. Wehling expects P&G's growing pool of women and minority junior managers to increasingly fill more seats in P&G's 100-member operations committee of senior managers.

Over the last five years, 41% of P&G's new management hires have been women and 27% minority members.

"Most of our focus at this point is to sustain those percentages over an extended period," Mr. Wehling says, "so that . . . without being [bound] to the numbers . . . we have the same representation at the higher management levels that we now have at the lower levels."


Retention has been a bigger challenge than recruitment, but a P&G spokeswoman says the company has doubled the number of women and minorities at the director level and above in the last five years. The percentage of women and minorities being promoted to higher management is greater than those being promoted to junior posts.

P&G's efforts to promote internal diversity include annual sessions that P&G Chairman-CEO John Pepper conducts with heads of each of P&G's four global business units. He reviews performance against diversity goals established for each of the company's businesses, and career planning for top women and minority managers, the spokeswoman says.

P&G also bases employee performance reviews in part on ability to "respect and work effectively with diverse people" and conducts regular employee surveys that track the company's diversity progress.

P&G also has a global corporate diversity officer, and each department of the company has a diversity task force and human relations manager for diversity.

Global representation has become an increasingly important dimension of diversity for P&G, which relies on global brands and thus strives for international representation on brand and category teams.


"Just as I think it's very difficult for a group of white males to effectively generate insights to market to Hispanics and African-Americans" in the U.S., Mr. Wehling says, "It's equally difficult to conceive of a group of Americans and Europeans effectively generating the insights to effectively market to Latin Americans and Asians."

Just as P&G looks to improve advertising and product concepts, the company last year applied its internal diversity training, Culture College, to its roster agencies, with sessions for agency executives in Cincinnati, Chicago and New York. Mr. Wehling expects the programs to be repeated regularly.


Culture College has been "enthusiastically received by our agencies," Mr. Wehling says, adding: "I think we're smart enough to discern the difference between going along with what we want and genuine enthusiasm. And I'm seeing genuine enthusiasm. I think this is going to make for better agencies and a better agency-client relationship, and it's ultimately going to be better for the diverse consumer groups throughout the U.S."

Agency progress on heeding Mr. Love's early call to diversify has been mixed, Mr. Wehling says.

"There are different levels of progress in each agency, just like there are in each part of Procter & Gamble," says Mr. Wehling.

But P&G's shops are "doing everything we could ask at this point," he says, adding: "I'm very confident that we'll see excellent results in the next few years."

Though P&G has been more outspoken on diversity as a brand strategy than most major advertisers, it's not alone in placing a premium on diversity.

"I see an increase in requests for individuals with backgrounds in product marketing in ethnic areas," says Eral Burks, president of Minority Executive Recruiters, a Cleveland recruiting shop. "Corporate America wants to know more about the ethnic market and what they can do to keep individuals spending and what they can do to give back to the community to show they're supportive."


Pressure to diversify should come increasingly from self-interest rather than altruism, says Alfred L. Schreiber, exec VP of Graham Gregory Bozell, a unit of Bozell Worldwide, New York, which has handled such clients as the Wall Street Conference on Race and Gender.

As he tries to pitch the services of an ethnic marketing agency, Mr. Schreiber still runs up against the attitude that minority markets aren't worth targeting because they're less affluent. But he points to a study his agency helped produce last year that shows minorities are buying homes, starting businesses and getting college degrees at a rate faster than whites.


Still, most marketers don't pay serious attention to diversity until they face a crisis, Mr. Schreiber says.

Texaco's response to an October 1996 release of tapes in which three top executives made disparaging remarks about African-Americans in connection with a race discrimination suit was a classic case in point.

To help make amends, Texaco launched an extensive diversity campaign that included spending more than $800 million on minority vendors, improving recruiting, and increasing minority representation among its dealers and distributors.

Texaco added UniWorld Group, New York, and KJS, San Antonio, to handle a print, TV, radio and outdoor ad campaign and sponsorships targeted toward building brand image and recruiting in African American and Hispanic communities.

The company also launched a $60 million corporate image TV ad campaign by BBDO Worldwide, New York, that aimed in part to show minority representation in the company's work force and distribution network.

Early results of surveys since the campaigns began are encouraging, says Mark Johnson, director-consumer advertising at Texaco, showing improvements in consumer perceptions of the company since what he refers to as "the incident."


Texaco's advertising efforts "probably worked better [with] Hispanics than it did [with] African-Americans, recognizing that we probably have more room for improvement there," Mr. Johnson says, adding that Texaco will continue ads targeted at both communities.

Though Texaco's survey found no appreciable damage for the brand among whites and Hispanics, Mr. Johnson believes the brand needed support with all three communities.

Ultimately, he believes the diversity campaign and new branding effort can go beyond damage control to actually boost the brand.

"Texaco got religion on diversity," Mr. Schreiber says. "They've gone from zero to hero. They hold out a template -- not the way they got into it, but in what they're currently doing -- that other companies would do well to follow."

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