Affirmative Action in Hiring and Firing in the Ad Industry and or Ad Firms

Affirmative Action in Hiring and Firing in the Ad Industry and/or Ad Firms

Advertising in the United States means a lot of money and as much as $2.1 million is spent on each advertisement during the Super Bowl advertisements lasting for 30 seconds. There is now a question as to whether the composition of workers within the industry, both in the creative sections and in the non-creative sections will affect the effectiveness of the advertising they create. It is true that today there are a lot more of black people being shown on the national television commercials. Whether they are being shown in suitable roles or not can be disputed, but they are certainly present in greater numbers. Today there are many commercials with black people on an increasing number of stations than at any previous time in history. There are of course not enough people being shown with other racial compositions though. It is often said that this showing of people is determined by the success of the advertising in terms of bringing in returns

Now let us have an understanding about a governmental study whereby we shall make the assumption that it is not influenced by considerations of racial ideologies. Certain radio stations which were minor had requested advertisements from the Beef Council. The reply from the council was that they will not buy time on the urban and formatted radio stations as they claimed that black people did not eat beef. (National Association of Black Owned Broadcasters, 1996, pp.1-2) A similar reason was given by a major manufacturer of mayonnaise, again with the justification that black people do not eat mayonnaise for not buying commercial time. (National Association of Black Owned Broadcasters, 1997, p. 2) In Washington DC area there are two leaders of the minority formatted radio stations - WHUR, and WKYS. They have better demographics based on measured income, age of audience, college graduation and employment ratios than the leading station in the top 40 - WPGC. Yet, they have a much lower power ratio. (National Association of Black Owned Broadcasters, 1997, pp. 4-5)

There are some products for which the blacks are the major consumers like the cognac or liquor industry. There between 60 to 70% of the consumption is by the Blacks. There are also similar cases in the promotion of tourism, especially the travel to Caribbean or other up market places. For this also the advertising never shows blacks as a major target. The feeling in the advertising world is that if they show blacks as the target audience, then the whites will not be interested in the product, and this will ultimately cause losses (National Association of Black Owned Broadcasters, 1997, p.37). These misconceptions often arise from wrong ideas about the minorities. There is a report of an interview with Luis Alvares, who was the Local Sales Manager of two Spanish Broadcasting system units, WSKQ and WPAT. He had tried to sell the radio stations for advertising to a brand called Ivory soap, but there was a refusal to buy from the buyer.

The buyer gave the reason as that they have studies which showed that Hispanics did not bathe as frequently as non-Hispanics. This sort of ideas may be true studies or just the gut feeling of the agencies. The reason for such reactions was well-known in the advertising circles. An advertising executive in the St. Louis area mentioned that it was a fact that most advertising agencies in the area were lily white totally, from the front door to the back wall. This made it difficult for the agencies to understand the black people whom they were advertising to. It was also felt by them that most of the black young men were gang members and criminals or the like. (National Association of Black Owned Broadcasters, 1997, p.42) Thus it is clear that in many parts of the country do not have enough numbers of black men in advertising and this deficiency is also leading to a lot of errors in advertising.

On top of this there are certain biases against the minorities. An example of this is the instance of Hispanics and groceries. The Hispanics are probably the biggest buyers of groceries, and they probably buy 20 to 30% more of groceries than other communities, due to their own lifestyle. The first reason is that they have much larger households than the white Americans and this leads to higher grocery consumption. On top of the largeness of the household, this leads to greater consumption of groceries as they eat more at home due to their family structure and lifestyle. This behavior also helps them cut down on restaurant bills. They also have a behavior of meeting at each other's place more often, and that also leads to more groceries. On the other side, the items inside a grocery store make up between 30 to 40% of the total advertising on the radio advertising; in addition to this is the advertising by the grocery stores themselves. Logically, this means that a lot of the grocery based advertising should be directed to the Hispanics.

Some people even say specifically that they do not want Hispanics in their store. Another reason is probably ignorance about the strength of numbers of the Hispanic population in some parts of the country. When the person deciding on the advertising budget sits at an outside location, where there are not many Hispanics, he may not be aware that they make up a sizeable number of the customers in some parts of the country. When the people have formed an opinion about Hispanics based not on real life experience but on TV, they often form a very poor image about them as their image is based on the characters that they are portrayed in on the TV or cinema. There they are shown as pimps, prostitutes, illegal aliens, drug dealers, and other types of people on the wrong side of the law. This makes them feel that Hispanics are not a desirable section of the population. (National Association of Black Owned Broadcasters, 1997, pp.44-45) This sort of image about the minorities goes on and on.

There is an urban formatted station, WBGE-FM, who had station manager named Michael Banks. He was told by a customer directly "Your station will bring too many Black people to my place of business." (National Association of Black Owned Broadcasters, 1997, p. 46) There is also the report of a store that moved from New York to a smaller town called Huntsville at the southern end. This town has a road that divides it into two sections - North and South. The major part of the black population lives north and the whites live south. The store moved to this location and the owner was aware of the fact that the black customers spent more on groceries than the whites. He was willing to try out the black customers and put on an advertisement on the black radio channel. This brought him a lot of customers from the black people. Then the store owner said that he wanted to cancel the advertisement. The reason he gave for cancellation was that he felt that his pilferage rate had increased, but he had no proof of that. He said that he did not have enough workers to judge it, but he felt that the people who were coming to the store looked suspicious, and he was certain that they were shoplifting. (National Association of Black Owned Broadcasters, 1997, p. 46)

This sort of an image in the media users is also reinforced by the behaviors of some of the radio stations. One of them prepared a memo for its own sales force saying "Get buyers to understand that WABC is one of the most upscale select stations in New York. We must get the buying community to understand and appreciate the unique qualitative, personality, and foreground profile of WABC. Advertisers should want prospects not suspects." (National Association of Black Owned Broadcasters, 1997, pp.47-48) It is not only the small store owner who is ignorant and who holds such opinion. This was told by a Macy's department store to a sales representative of a major Spanish broadcasting channel, WSKQ and WPAT. They said that their pilferage will increase if they advertised to the Hispanic market.

These complaints by the owners of the black media are not new and are being made for decades. Recently on January 13th, there was a study released by the Federal Communications Commission that confirmed that many advertisers often excluded radio stations which specifically targeted the black and Latino audiences from their advertising plans. If by chance they include them, they try to pay them much lower rates than the white stations even with their having larger audiences. This study revealed that the advertising industry had a practice called NUD. This means no urban dictates or no Spanish dictates. When this is applied, the advertisers automatically exclude stations which are aimed at the minority audiences. It does not matter what the audience ratings for the station are. This has reduced the income of these stations by an average of 63%. The practice is very widespread as 91% of the broadcasters targeted to these segments had experienced NUD according to the results of the survey. (Advertisers avoid Black Media) Thus it is clear that there are some practical difficulties for the advertising industry to give opportunities to the deserving candidates from the minority communities. For some people, at sometime, the truth may be unpalatable.

There is confirmation through the FCC report that some advertising decisions are still being influenced by old stereotyped thinking like "prospects not suspects." The study was authored by Ofori who said that the client was presented with a lot of marketing data which showed that the audience catered to by the particular radio station was clearly the types who were likely to buy cars like the Volvo, and which cost as much as Volvos. In spite of the data, the dealer continued to say that they were not interested. The discussions then went up to the chief of the dealership station, and he simply said that they did not want advertising on that station. It then became clear to even Ofori that the decision was not being taken based on business as the marketing data was being ignored.

The dealership had judged that they will not be associated with the audience that was being contacted by that station. Thus some members are not interested only in the sale of their products, but also interested in controlling the image of their product. They probably have a fear that if the product is used by or associated with blacks, they would end up losing the white customers. This analysis was felt to be true by a number of black groups like the National Association of Black-Owned Broadcasters (NABOB), the Rainbow/PUSH Coalition, the Media Access Project, and the Urban Institute. (Advertisers avoid Black Media)

The reduction in revenue has lead to the demise of some of these stations. There was only one black owned radio station in Phoenix. This had to stop broadcasting, mainly due to the lack of income from advertising. The FCC study had specifically found out the reasons for NUD policies to be based on stereotyped thoughts, untrue concepts about disposable income and the result of an attempt to maintain certain images about the whites. The Urban Institute has found out a list of companies with NUD policies and some of them exist in the Valley. These companies just ignore the available studies like the 2002 Arbitron Black Consumer Study. This study had highlighted the strength of the purchasing power of the blacks. For example very few know that 64% of the blacks use the Internet. (Meridith. My View, Diversity in advertising fights prejudice, attracts buyers) Similarly, there was a study by Kang and Lee Inc. regarding the strengths of the Asian market. They had even given a talk on this at the Greater Phoenix Convention and Visitors Bureau.

Thus many available facts and figures are being ignored. An important reason for this has been pointed out by Samuel Chisolm, the chief executive of Chisolm-Mingo group. They are the largest independent U.S. black advertising firm. He has said that there are very few colored people within the advertising industry. Today there are fewer blacks within the industry as compared to the numbers in the 1980s and 1990s. They are probably less than 1%. When the people in an agency are diverse, each of them provide their own touch of color, and that creates a difference. They use words differently, use images differently, colors differently and interpret events differently. This often appeals to the different people - the people who are similar to them. (Meridith. My View, Diversity in advertising fights prejudice, attracts buyers)

To a certain extent the minorities, especially the blacks are being advertised to, both in the local markets as also the national markets, there has not been much change for the better for them in the total advertising industry. In the industry, there are very few advertising firms of African-American origin who are hired to do any work. Even when they are hired, their budgets are very small compared to the budgets received by white firms for the same type of work. When it seems that they are likely to succeed, the clients put in obstacles so that they can achieve only limited success. Sometimes the client will also put a negative interpretation on the responses received in relation to the advertising. When the campaigns become successful, the agency is rarely rewarded with bigger or better contracts for advertising, or even given better terms.

These types of stories are cited by all of the African-American owned agencies from all parts of the country and are not unique to any particular agency. The white owned agencies combine with the companies in the United States to achieve this end. Their objective is to put up more obstacles on the path of progress for African-American agencies. Among the cities, Pittsburgh may have the worst record of all cities. There are very few agencies there in the upper ranks with black origin, and there are no such agencies in the lower group. This city also does not produce new black agencies which are able to maintain their staff for more than five years. The programs for diversifying industry are quite unsuccessful and very few of the blacks get jobs in the advertising industry. There was an article on October 14th, 1996 in Minority Business Times with the title of "Marketing to Minorities" on this subject. This is a bad joke, as the author did not consult a single African-American advertising agency for their views and examples.

All the overt and subtle issues faced everyday by a black consumer cannot be understood by a white-owned agency. The white owned agencies do not like to work with the blacks, except when they are forced into it. They call in the black owned firms as sub-agencies to help them win the contract. After they are able to win the contract, they just pass on a few token orders to the black agency. Today, there is a lot of noise being made about affirmative action for the minorities in advertising agencies, but there is no enforcement of this in the agency world. (Bynum. Solutions to the lack of blacks in the advertising industry)

In the city of Phoenix, the volume of advertising done by the black owned agencies are a pittance according to Ray Arvizu, who is the owner of the fifth largest agency and the biggest agency owned by the blacks. The other black owned companies are relatively of recent origin and comparatively small firms like Southwest Dimensions, AMMI and Turbo Advertising. These firms are mostly attending to ethnic marketing. On the other side, one must remember that the city of Phoenix has a one-third population of minorities, and the representation of blacks in advertising is much smaller than proper in relation to their population. This deficiency has been attributed to the lack of mentors and role models by Renetta McCann, CEO of Starcom NA, and they are one of the largest media companies in the country.