The current industry conversation around investment inequalities in the media and creative supply chain has been extensive, and rightly so. For example, there has been tremendous interest in supporting Black-owned businesses and Asian-owned businesses have also garnered interest and support.
Those are both positive developments, but Hispanic-owned businesses have been left out of much of this conversation and that’s not right. Furthermore, it’s been stated by the Hispanic Marketing Council that “Too many brands are ‘robbing Peter to pay Paul’ by shifting budgets from Hispanic to Black and Asian efforts without ever expanding the size of the investment.”
Forty percent of the population is currently multicultural, including 18-20 percent who are Hispanic, according to U.S. Census figures. More than half of births in the United States are now to multicultural women, with Hispanic families leading the way. A company’s media and creative supply chain should reflect that diversity – and that means a commitment to Hispanic businesses and marketing support to Hispanic consumers.
ANA’s just-released study– “The Growth of Supplier Diversity” – asked several questions about the ethnicity and gender of businesses targeted with supplier diversity programs for marketing/advertising. Among those businesses, Hispanic-owned companies are near the top of the list, noted by 91 percent of respondents.
In drilling down further to identify where the most spend is, Hispanic-owned businesses were second. But there is a wide gap between Women-owned businesses, which were at the top of the list.
Finally, when asked what types of businesses marketers expect to spend more with in the next year, Hispanic-owned businesses ranked third. That’s good news for the Hispanic segment.
As marketers increase their spending and commitment with diverse suppliers – whether those suppliers are Hispanic, Black, Asian, or other – they are urged to keep some important considerations in mind.
- A strong supplier diversity program helps ensure that a company’s suppliers reflect the communities it serves.
- The top challenge in supplier diversity for marketing/advertising is finding diverse suppliers. The ANA and the ANA’s Alliance for Inclusive and Multicultural Marketing (AIMM)have curated two resource lists: (a) Certified Diverse Suppliers and (b) Suppliers Serving Predominantly Multicultural and Diverse Audiences, Non-Minority Owned and/or Non-Minority Certified. Both are updated regularly with details at www.ana.net/diversesuppliers.
- Another key challenge in supplier diversity for marketing/advertising is providing visibility to opportunities to recommend diverse suppliers, meaning being able to find projects for diverse suppliers to bid on. It is generally the role of procurement to work with their internal stakeholders to identify such opportunities. Companies should minimally follow the “rule of one” — including at least one diverse supplier in every RFP, if relevant.
- Some diverse-owned businesses are certified by organizations including the National Minority Supplier Development Council (NMSDC); some are not. For some marketers, that certification may be a requirement for doing business. I heard one marketer say, “Certification authenticates that a supplier is who they say they are and removes the onus on the marketer to do that.” To maximize business opportunities, suppliers should be certified. At the same time, the industry should work together to help make the certification process easier (and less of a barrier) for suppliers.
- For many companies, media is their most significant marketing/advertising investment. Yet finding diverse media suppliers has been a particular challenge, as the pool of diverse owned (and/or certified) media companies is small. Marketers are encouraged to expand their criteria when sourcing suppliers to include certified diverse suppliers, suppliers that are diverse-owned but not certified, suppliers that are diverse-operated but not diverse-owned, and/or those suppliers that target diverse segments but are not diverse-owned or operated.
- Supplier development plans are important. These are growth and/or improvement plans specific to a diverse supplier supporting a business, and may include financial, time, and/or mentoring investment by a company. Some marketers are even stepping up to help diverse suppliers become certified. It’s not enough to simply spend money with diverse suppliers. Rather, marketers should invest in the resources to help develop those suppliers be successful.
- Perhaps most importantly, marketers need to be open to doing business differently when working with some diverse suppliers. For example, they may need to add new people to their teams, invest more time in supplier relationships, relax payment terms, and look beyond conventional metrics. For the latter, marketers should be open to conversations with diverse suppliers on ways to evaluate a partnership. Marketers are encouraged to think beyond scale and reach for their supplier diversity programs and instead consider the importance of audience engagement and relevance.
- A 2019 study conducted by PQ Media on behalf of AIMM found that multicultural media investments comprise only 5.2 percent of total advertising and marketing revenues, yet multicultural consumers now comprise approximately 40 percent of the total population. Those numbers suggest an opportunity for more marketers to engage multicultural consumers to drive business growth. Marketers – TAKE ACTION!
ANA’s just-released paper – “The Growth of Supplier Diversity” – is available as a resource to all at www.ana.net/supplierdiversity.