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GM Pledges To Allocate 4% Of Its Ad Budget To Black-Owned Media.

In a move that could benefit African American-owned radio companies, General Motors has pledged to spend more ad dollars on Black-owned media outlets. The largest American automaker said last week it would allocate 4% of its U.S. advertising budget to Black-owned media companies by next year and double the outlay to 8% by 2025.

The announcement follows pressure by Byron Allen and other Black media moguls who placed full page ads in the Detroit Free Press, the Wall Street Journal and other publications claiming that GM ignored Black-owned media outlets. Allen, owner of 16 broadcast affiliated TV stations, eight cable networks including The Weather Channel and a syndicated production company, earlier sent letters of intent to GM, McDonald’s and other major advertising brands, threatening legal action if they don’t shift at least 2% of their ad budgets to Black-owned media.

The newspaper ad that ran in the Detroit Free Press took the form of an open letter to GM CEO Mary Barra. It claimed the auto giant spends less than 0.5% of its advertising in Black-owned media, even though “African-Americans make up approximately 14% of the population in America and we spend billions buying your vehicles.”

But GM disputed the 0.5% figure putting the current number at 2%, according to a story in The Wall Street Journal. “We are disappointed that Mr. Allen and his fellow signatories resorted to additional paid media advertising to advance a narrative of factual inaccuracies and character assault against our CEO,” GM said.

In a response, Allen said the executives who signed the open letter asked GM for the percentage and the company wouldn’t provide it. “Our best estimate was 0.5%,” he said in an interview.

GM said it would hold a series of meetings with Black-owned media companies during the next few weeks.

After receiving Allen’s original letter, GM responded with a statement in mid-March. “We continue to develop and advance initiatives like the Chevrolet 'Real Talk, Real Change' platform and support projects like 'More than That with Gia Peppers,' where we’ve partnered with the National Association of Black Owned Broadcasters on a content series for Black American listeners produced and distributed by underrepresented businesses,” the statement read. “In this same spirit, we will continue to have an open dialogue with Mr. Allen."

Announced in February, the nine-episode audio series “More Than That with Gia Peppers” was developed in collaboration with the ad agency Dentsu and One Solution, the branded solution division of Urban One. The result was a series of 20-minute shows focused on wellness, entertainment and wealth that aired across radio stations owned by Urban One, as well as Spotset Radio Network and American Urban Radio Networks. Each also airs one- or two minute “micro-episodes” to drive tune-in. After each episode airs on radio on Saturdays and Sundays, it is then made available as a podcast.

Allen’s pressure and GM’s pledge come as some agencies and brands are stepping up their efforts to invest in Black-owned media after years of underinvesting in the space. “We began to see more interest in our African American audience, and a shift in major marketers’ mindset towards that audience, with the Black Lives Matter movement and the murder of George Floyd,” Andy Anderson, President of Sales at AURN, told Inside Radio in late January. “Corporate America began to understand the racial injustices and systemic racism African Americans faced in this country, not just in the streets but in all aspects of society, including education, housing, healthcare and corporate representation.”

While there is heightened interest among brands in reaching the 28.9 million African Americans that listen to radio each week, execs say it is only a step toward bringing parity for Black stations.

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