After being pressured to substantially increase the amount of money it spends with Black-owned media, General Motors revealed plans today to double its advertising and marketing spending with diverse media companies while committing to additional “engagement” with the leaders in the segment.
Detroit-based GM announced it will increase its overall “diverse” media spend from 2% of its budget this year to 4% in 2022. The goal is to get to 8% by 2025.
“This action plan will transform our engagement model with diverse media in a sustainable way,” said Deborah Wahl, GM global chief marketing officer, in a statement. “Over the course of several weeks, we met with many diverse-owned media organizations. We are grateful for the transparency and spirit of collaboration, which helped us frame this inclusive approach.”
Today’s announcement follows GM’s pledge in June 2020, as part of the Alliance for Inclusive and Multicultural Marketing, to commit to equality, inclusion and systemic change in advertising.
In addition to adding money to the spend, the company is hosting a “Diverse-Owned Media Summit” on May 14. The meeting is designed to encourage existing and potential GM partners to submit an overview of their business, including a request for proposal.
GM plans to use that pool of RFPs to determine where to spend its ad and marking dollars in the future. The process for the selection of media partners will be accredited by a third party to ensure fairness and transparency, officials noted.
In addition, the company and its media buyers are changing the way they determine where to spend their funds. Going forward, they will use a “multi-factor analysis” that assesses capabilities, reach and analytics to find new diverse media to partner with.
Additionally, it appears GM will work with diverse media companies to reshape the auto company’s measurement metrics. This will “allow for more flexibility based on the size and scale of the media organization. GM’s priority, in collaboration with diverse media, is to create a win-win for the diverse media companies and GM,” the company said.
Finally, GM is creating a $50 million Diverse Marketing Incubator Fund. The goal is to allocate the money during a 10-year period to support and grow diversity-based marketing companies. The money is in addition to the company’s previously allotted marketing dollars.
Inspiration for the new approach
The owners and top executives at seven Black-owned media companies chided GM and CEO Mary Barra in full page newspaper ads in the Detroit Free Press and later the Wall Street Journal last month. In the ad, they suggested the company, by its lack of financial support of Black-owned media, was participating in systemic racism.
They demanded an increase in spending to promote “economic inclusion.” The group took direct aim at Barra suggesting she was racist and demanding her resignation if she didn’t respond. Initially, she agreed to meet with them.
The signatories of the ad — including Weather Channel owner Byron Allen; rapper, actor and media mogul Ice Cube; and Junior Bridgeman, the owner of Ebony Media — demanded that GM devote a minimum $200 million annually to Black-owned media, with the figure increasing 5% annually during the next 10 years.
“Mary Barra has the opportunity to be on the right side of history,” Allen said during a conversation with TheDetroitBureau.com midday Wednesday. He acknowledged his group would try to leverage any agreement with GM to win similar concessions from not only rival automakers but corporate America in general.
“Every corporation in America will be held accountable if they don’t do business with Black media in a respectable way,” he said.
Hours later, when the original meeting with the seven media execs was canceled he expressed surprise and anger. “What they’re trying to do is divide and conquer,” Allen said by phone. “They should be meeting with us.” Music and fashion mogul Sean “Diddy” Combs lent his support to the seven signatories, suggesting a boycott of GM products could be coming.
Response to the new plan
The decision to hold multiple meetings with a broader cross-section of the Black media community was well received by others, however. Some of those meetings have taken place, resulting in much of this new action plan from GM, including with the National Newspaper Publishers Association (NNPA), a group of Black-owned media companies. Thus far, none of the seven signatories has responded to the plan publicly.
“The NNPA notes with appreciation a recent substantive discussion with General Motors Chairman and CEO Mary Barra and with other GM executives about establishing a strategic partnership between GM and the NNPA going forward, today in 2021 and into the future,” said Benjamin F. Chavis Jr., NNPA president and CEO.
“The new GM action plan, including stated commitments to increase advertising spends with African American-owned newspapers and other African American-owned media, is good news for Black America. The NNPA represents 230 African American-owned media companies and we reaffirm our 50-year plus support from GM. Yet, the future looks much brighter today as a result of GM’s new transformative commitments and engagement with African American-owned media businesses.”