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on multiculturalism

Three years ago, I started the Wall Street Project, on the anniversary of Dr. Martin Luther King's birthday. The mission of the Wall Street Project is to challenge corporate America to end the multibillion-dollar trade deficit with minority vendors and consumers. Dr. King understood then that beyond the struggle to end slavery, end legal segregation and assure every American the right to vote is the struggle to promote equality in access to capital. It is my impression that the private sector must take the lead in making the marketplace more inclusive because expansion of the marketplace leads to sustainable economic growth.

We are, I believe, at the leading edge of the fourth stage of the civil rights movement: the battle for a broader sharing of wealth. This frontier demands that we move beyond the great political struggles of the past that led to the enactment of voting rights and public accommodation laws.

This frontier acknowledges that most of the decisions that affect our communities -- for better or worse -- are made far from the halls of government. They are instead made in corporate boardrooms, in the suites of investment bankers, in the offices of pension fund trustees, in radio and TV stations and in advertising agencies.

We are no longer fighting for the right to spend our money. Today, we are the vital clients and shareholders whose presence is driving up the profits of corporations. What we are fighting for is our recognition as both consumers and trading partners. But we also want access to capital, opportunity and the public airwaves. We want to own some of the cable and broadcasting entities that engage our communities.

Companies must begin to act as though our consumer dollars are not worth less then everyone else's. By purchasing stock in over 200 companies, we have changed the dynamics of protest. Corporate America must therefore work and spend to attract our consumer dollars. This is the new battleground of the future, as we continue fighting to make the American Dream an American reality for everyone.

Recently, the American economy has seen unprecedented growth. With this the reach of the minority consumer has also grown. Minority buying power is now a vital part of the American economic landscape. African-American and Hispanic consumers, for example, earned over $700 billion last year. Minority buying power is therefore pivotal to the success of any consumer product. As our country's demographics change, the importance of minorities as consumers will continue to increase.

Multicultural marketing therefore is not just another "cause," it is good for business. It is a sign of respect for the growing prominence of minority consumers. Multicultural advertising efforts should therefore be considered an intelligent response to the growing power of minority consumers and their spending habits.

Unfortunately, according to the American Association of Advertising Agencies, while consumer advertising spending last year rose to about $160 billion, only $1.1 billion of that amount was targeted to the African-American market. This is unequal treatment of a consumer market so fundamental to product success.

To maintain and increase a competitive market share in the future, companies must earn customer loyalty within communities of color. This can only be done by dramatically increasing the level of advertising expenditures that target ethnic consumers. While individual minority consumers have less disposable income than their white counterparts, studies show that they spend it at a faster rate.

Furthermore, minority consumers are both brand conscious and loyal, thereby making targeted advertising efforts more effective. Thus for many companies, multicultural advertising must be more than a short-term scheme to avert some political crisis. Efforts to diversify all aspects of the advertising industry must be a fundamental part of a corporation's long-term economic planning, because we all have a direct impact on the bottom line.

Yet, while the reasons for multicultural advertising seem endless, many continue to resist. Companies still have to be convinced that targeted advertising campaigns work. They continue to take the purchasing power of their minority customers for granted. Business leaders have cultural blinders, obstructing their ability to see non-traditional but lucrative markets. They need to see that they are not their brother's keeper, they are their brother's brothers. This new way of seeing combines enlightened self-interest with a moral imperative.

For too long advertisers have had a distorted view of Hispanic, African-American and other minority groups. As Pepe Sutton, chairman of Inner City Broadcasting, said at the Rainbow/PUSH Wall Street Project conference in January, "Ad agencies are practicing covert racism based on stereotypes, fueled by ignorance and characterized by stubbornness and entrenched structures."

While none of this is new, it was not until the infamous internal memo from Katz Radio Corp. that the issue became public. The memo, circulated by a Katz employee, instructed sales representatives to steer companies away from purchasing advertising on ethnic-oriented stations, noting that "advertisers should want prospects, not suspects."

As the memo's author illustrates, minority consumers are often misunderstood and disrespected. Such blatant disregard assumes that the general market is the only factor in determining the success or failure of consumer goods and services. Many in the advertising industry believe that minority consumers will not be moved by advertising, as majority consumers seem to be.

In other words, they believe that our markets are not viable. This is wrong. Minority consumers will identify with the products that best serve them and the companies that court them.

Advertisers should also support minority-owned and -operated media outlets. Many of these radio and TV stations produce compelling programming geared towards the growing minority communities. Yet while their programs are often well received and highly rated, they receive lower advertising rates than general program stations. As Federal Communications Commission Chairman William Kennard's report, "When No. 1 Is Not Enough," indicates, advertisers are unwilling to pay the same advertising rates to media outlets with minority programming. The revenue gap between minority-owned and majority-owned media companies must end.

As our demographics change, advertisers that support diversity by reaching out to minority-owned media will be better positioned to reach America's most powerful consumers. The FCC study, by Kofi Ofori of the Telecommunications Civil Rights Forum, found that white-owned broadcasters get 30% more revenue than minority broadcasters with similar or stronger ratings. Companies will make a better case for their products if they make commitments to minority-owned stations.

It is not enough to court minority consumers. Advertisers should begin to cultivate minority-owned radio and TV by advertising with them and paying them fairly. Advertisers should form business partnerships with minority-owned media, as they are the future outlets for what will be the fastest growing consumer base of our nation. It is the responsibility of the companies that thrive on our consumer dollars to hire advertising agencies that will promote this concept. Companies must underscore to their agencies that the value of the minority consumer dollar is important.

Finally, the imbalance created when urban broadcasters receive less than their fair share of advertising means that minority-owned media have less capital to operate their businesses. Without this, minority-owned stations are unable to increase programming commitments. They are less able to present original programming. Neglected and overlooked minority-owned stations don't have the capital necessary to acquire other stations and expand their business. In other words, discriminatory practices by advertising agencies prevent minority media outlets from effectively competing in a changing economy.

It is therefore the responsibility of all companies to fully engage minority consumers and minority-owned media. It is simply about expanding the marketplace for all people. This is the future of American business.

The Rev. Jackson is president of the Chicago-based national Rainbow/PUSH

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