Building relationships with diverse consumers key to success says My Code boss

But they’re not shifting very fast. And over the coming year, industry players want this trend to speed up. Parker Morse, founder and chief executive officer of My Code, tells The Drum that advertisers have begun accelerating investments directed into diverse media in recent years.

The company is the largest multicultural media firm in the US and specializes in facilitating advertiser investment in Hispanic audience-focused publications and those aimed at Black, LGBTQ+, Asian American and Native Hawaiian/Pacific Islander (AANHPI) consumers. It works with over 1,200 titles across North America; the AIMM estimates there are around 2,300 such outlets in the US.

Morse claims that, despite those demographics accounting for around 40% of the US population, less than 10% of ad dollars are directed their way.

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More marketers realize that closing this gap is a “business imperative,” Morse argues. “When you look at population changes and spending power changes in the next 20 to 30 years, if you’re not building a relationship with diverse consumers, you’re not going to have a successful business in the US,” he says.

There have been signs investment into the more expansive, diverse/multicultural advertising space has been increasing. This year, Burrell Communications was acquired by a consortium led by Black-owned private equity firm FVLCRUM Partners. But minority-owned agencies and media companies have historically found it difficult to argue for more investment or to capture their fair share of it.

Some advertisers are heeding this call; AIMM’s figures showed that investment growth in diverse radio, TV, digital print and out-of-home media outpaced the same for the US at large; total ad spend in the US grew 9% between 2020 and 2022, versus 80% for diverse media in the same period. But it’s rising from a small base. Ad spend in diverse-owned media rose $1bn between 2020 and 2022 but accounted for only 1.9% of overall US spending.

My Code aims to position itself as the single gatekeeper between advertisers and these audiences. At the end of November, Project Black, a $1.45bn fund operated by private equity firm Ariel Alternatives, acquired the company at a $400m valuation. Morse says the sheer variety of diverse-owned and targeted media and the relative absence of large media companies dedicated to those audiences is a stumbling block to further spending.

“The fragmentation that exists in diverse targeted media is real. On the TV side, there are not a lot of places of real scale that a marketer can go to and drive material impact. When you look at the digital side, there are few places of scale and substance. That’s what we’ve solved,” he says.

“As we partner with media agencies, who are our main clients today, we endeavor to help them be more successful. Their success is our success,” Morse says.

In April, the ANA found that only 38% of diverse media owners said advertiser investment had increased over the past year, despite 56% reporting rising ‘interest’ among marketers.

Earlier this year, GroupM pledged to increase client spending with diverse media titles to account for 5% of its overall US advertising investments. “We have a responsibility to accelerate growth through the next era of media,” Kirk McDonald, the chief executive officer of GroupM North America, said at the time.

Other holding companies have also put together formal efforts to accelerate cash flowing into diverse media; Dentsu, for example, published a 30-day payment policy for minority-owned media companies in 2021.

Morse argues that the entire media industry shares that responsibility. “We hope to be a leader and have a megaphone to drive the ecosystem forward,” he says. “We think we can have a material impact.”

But one company can’t force the issue by itself, he concedes. “It’s going to take a village.”