Resistance to Changing the Status Quo

Resistance to Changing the Status Quo

While the new face of Pennsylvania Avenue in Washington, D.C., reflects today’s multicultural society, the business community of Madison Avenue bares almost no resemblance to its immediate environment– considered one of the most culturally and ethnically diverse cities in the U.S.–according to a damning report that charges racial discrimination throughout the U.S. advertising industry, laying the groundwork for litigation.

Racial discrimination in advertising is 38% worse than in the country’s overall labor market and the divergence between racial equality in this industry and the rest of the labor market is more than twice as large today as 30 years ago, according to the Research Perspective on Race and Employment in the Advertising Industry. The 104-page study, released in January, was compiled by Washington, D.C.-based Bendick and Egan Economic Consultants Inc., an independent research firm that provides research, policy analysis, training, and consulting to government, business, multinational organizations, and the nonprofit sector. It was commissioned by a coalition of legal, civil rights, and industry leaders who created the Madison Avenue Project, formed by the NAACP and Mehri & Skalet P.L.L.C. law firm in Washington, D.C., in 2008 to address advertising’s deep-rooted racial bias.

Among the findings:

Based on national demographic data, 9.6% of advertising managers and professionals should be African American. The actual percentage in 2008 was 5.3%, representing a difference of 7,200 executive-level jobs.

About 16% of large advertising firms employ no black managers or professionals, a rate 60% higher than in the overall labor market.

Blacks are only 62% as likely as their white counterparts to work in the powerful “creative” and “client contact” functions in advertising agencies.

The data “blew me away,” exclaimed Project leader Cyrus Mehri, a prominent civil rights attorney who has won several huge discrimination settlements against corporations, including Coca-Cola ($192.5 million), Texaco Inc. ($176 million), and Morgan Stanley ($46 million).

The $31 billion-a-year industry presents numerous challenges and barriers to entry for African Americans, including low starting salaries, poor recruitment, worse retention, and lack of mentors. There is also the long-adhered-to experience requirement. This last challenge demands experience at a celebrated agency, specific category experience (i.e., automotive, pharmaceutical, beauty), impressive industry relationships, television production skills, and the ability to hit the ground running, which is repeatedly mentioned as a hurdle for the mid- and senior-level talent.

“There is always a demand for top talent,” says Carol Watson, president of Tangerine-Watson, a multicultural talent management firm in New York City that specializes in advertising, communications, and marketing. “But the hot agency, award-winning work, in-demand categories, and hard-to-find digital skills agency hiring managers require is very specific and significantly reduces the vast majority of candidates agencies consider qualified.”
Often agencies are not only looking for candidates with very specific experience in specific sectors, such as brand management in automotive, they are also seeking candidates whom they feel will be a good personality match for the agency as well as the client. The “casting” process often eliminates blacks.

“Because we’ve had such a narrow point of view in terms of what the right fit is for our clients, it has automatically  been said when you’re looking at a résumé, it needs to do this, this, this, and this and if they don’t, move on,” explains Nancy Hill, president and CEO of the American Association of Advertising Agencies. “That is what has eliminated a lot of minority candidates across the board. And by the way, not just African Americans but also Hispanics, Asian Pacifics, and women.”

Hill says agencies are starting to view résumés differently by rethinking “traditionally held ideas about staffing such as only women should work with clients/products aimed at moms or only African Americans should work on urban accounts.”  A problem bigger than recruiment, however, is retention. Advertising agencies are doing very little to support, train, and mentor diverse employees once they are hired.

Mehri is appalled at the way the industry has segmented the market by setting  up small boutique agencies with limited budgets to specifically market to the minority consumer while an all-white team at the parent company handles mainstream accounts.

African Americans wield $913 billion in buying power and that figure will grow to $1.2 trillion by 2013, according to data from the Selig Center for Economic Growth at the University of Georgia. However, African Americans are losing ground to Hispanics, the new consumer darlings. Their $951 billion in spending power in 2008 translates to a 349% increase since 1990 and easily surpasses the 187% jump for African Americans and 151% increase of all consumers. By 2013, Hispanics’ buying clout will leap to $1.4 trillion. This isn’t lost on advertisers. Nielsen figures show advertisers spent $1.8 billion, or 5.3% less, on African American media and $4.3 billion, or 2.7% more, on Spanish-language media through the first three quarters of 2008.

Challenging racial discrimination on Madison Avenue, however, dates back to the early 1960s. Every several years there’s outcry to no avail. New York City’s Human Rights Commission, under the direction of former prosecutor Patricia L. Gatling, helped bring it to light again in 2006. She wielded her power and tenacity to get 16 of the city’s top agencies to sign a diversity agreement with the commission, thus pledging to meet self-set hiring goals to increase representation of minorities in professional and management positions. (The definition of “minority” is left to each agency.) Every January, for three years and ending in 2010, the agencies (now 15 after a merger) must report their upcoming minority hiring goals and actual hires for the previous year to the commission, which has the authority to fine, subpoena, and hold hearings. The 15 agencies met 24 of the 30 goals they set for themselves in 2007, the only year all numbers were available as of press time. Each agency set two goals: one for hiring managers and one for hiring professionals such as copywriters. The agencies expected minorities to account for 18% of their combined 2007 hires but exceeded those hopes with 25%. The goal was a combined 19% for 2008. While some agencies met or exceeded their goals, others have fallen short. Arnold Worldwide expected to hire minorities for 30% of its management and professional hires and did just that in 2007. It pledged to do the same in 2008. Y&R exceeded its plans of 18% management and 30% professional after hiring 27% and 46%, respectively. It pledged 20% and 33% respectively for 2008. Neither DDB Worldwide nor Merkley + Partners, each with a 10% goal for management and both part of Omnicom Group, the largest holding company by revenue, hired any minorities in that category in 2007. Merkley’s 14% professional hire was also lower than its 22% pledge, making it the only agency to miss each of its 2007 marks. Both set identical goals of 10% and 22% for 2008.

Over the last three years agencies have hired diversity officers, launched diversity internship programs, and tied the attainment of corporate diversity goals to senior execs’ performance reviews. The American Association of Advertising Agencies committed $250,000 to begin planning an ad center at Howard University. And in a $1.25 million deal with New York City Council member Larry Seabrook, Omnicom Group, which also includes BBDO Worldwide, agreed to establish an advertising, marketing, and media readiness curriculum at Medgar Evers College.

“The problem is right now, even if they are doing good things they have no credibility,” says Mehri. “They’ve gotten away with it, [but] that is going to stop now. They act like they’ve heard the warning signs and they’re going to do something about it and then they initiate an internship program, and then people back off. They keep doing that same routine over and over again.”

Gatling criticizes the minorities in the industry for letting this problem exacerbate. She says the post-1964 civil rights babies were too worried about being blackballed to say anything.

“Silence breeds this culture of fear. I spoke to a lot of people who left the industry, something they really wanted to do, because they just couldn’t navigate it.”

Meanwhile Mehri is contemplating his strategy. He’s yet to decide whether to pursue litigation, a complicated matter because it would likely involve suing agencies individually. The first step is for the NAACP to send letters to advertising’s major clients, who can pressure the

This article originally appeared in the April 2009 issue of Black Enterprise magazine.