How Sundial Media Group CEO Kirk McDonald is navigating the DEI backlash

Summary

The Digiday Podcast: Navigating DEI Backlash with Sundial Media Group CEO Kirk McDonald

Release Date: February 18, 2025

In this insightful episode of The Digiday Podcast, host Tim Peterson engages in a comprehensive discussion with Kamika McCoy, Digiday's Senior Marketing Reporter, and their guest, Kirk McDonald, CEO of Sundial Media Group. The conversation delves into the current landscape of Diversity, Equity, and Inclusion (DEI) initiatives, the challenges brands face amid a growing DEI backlash, and strategies for navigating these turbulent times.

---

1. Setting the Stage: DEI Under Scrutiny

[00:57] Kamika McCoy introduces the primary focus of the episode, highlighting her recent interview with Kirk McDonald. She notes the increasing backlash against DEI efforts, mentioning that major companies like Comcast and Disney are under scrutiny for their DEI policies. McCoy emphasizes the importance of understanding how this backlash impacts diverse brands and black-owned companies within Sundial Media Group's portfolio, which includes publications like Essence, AFROPunk, and Refinery29.

Notable Quote:

"Diversity has become the dirty D word, if you will, and kind of what that means for a portfolio of diverse brands, black-owned companies and things like that."
— Kamika McCoy [02:30]

---

2. The Diminishing Impact of Super Bowl Advertisements

Tim Peterson raises a pertinent observation about the declining lasting effects of Super Bowl advertisements. Unlike previous years where ads from brands like Budweiser and Pepsi sparked widespread conversations, this year’s Super Bowl lacked memorable commercials. Instead, the conversation centered around the Kendrick Lamar and Drake feud, with brands like Duolingo and Zillow attempting to ride the wave of this unexpected cultural moment.

Notable Quote:

"There's been a couple of like lawsuits around like Paola and things like that. So I feel like it gets real sticky real fast."
— Kamika McCoy [05:05]

---

3. YouTube's TV Tipping Point

The discussion shifts to YouTube's evolving role in the digital landscape. Celebrating its 20th anniversary, YouTube now sees Connected TV (CTV) surpass mobile in viewership, marking a significant shift in how audiences consume content. Peterson explores whether this change is prompting creators and brands to pivot their strategies towards the TV experience without compromising mobile engagement.

Notable Quote:

"YouTube has held that since then. So people are spending more time watching YouTube on TV screens than Netflix or Disney Plus Hulu Peacock, like on down the list, YouTube's the top one."
— Tim Peterson [08:56]

---

4. The Trade Desk's Revenue Forecast Miss

Amidst earnings season, The Trade Desk faced its first-ever revenue forecast miss, causing investor concerns and a subsequent drop in stock price. The conversation touches on the potential ripple effects this miss could have on the broader ad tech industry, especially as The Trade Desk considers shifting to direct advertiser relationships, which might strain relationships with media agencies.

Notable Quote:

"The Trade Desk is going to try to be doing even more business directly with advertisers, which is a delicate balancing act because so much of the Trade desk business has to do with media agencies."
— Tim Peterson [13:00]

---

5. In-Depth Interview with Kirk McDonald

a. Kirk McDonald's Journey and Commitment to DEI

Kirk McDonald shares his extensive background in media and ad tech, highlighting his roles at PubMatic, App Nexus, Group M, and now Sundial Media Group. His commitment to DEI is evident through Sundial's portfolio, aiming to serve underserved and underrepresented communities.

Notable Quote:

"Our commitment to serving underserved communities, meeting them in their need states. Especially because with titles like Essence, we've been doing it for 55 years..."
— Kirk McDonald [20:39]

b. Current State of DEI Initiatives

McDonald discusses the ongoing debate around DEI, whether it's viewed as a rollback or a rebranding effort by organizations. He emphasizes the importance of brands recognizing the evolving demographics and needs of today's consumers, who demand authentic engagement and representation.

Notable Quote:

"Brands today... have to recognize that the current general market is not the old general market. The new general market is actually made up of a bunch of different communities."
— Kirk McDonald [25:37]

c. The SOCO Market: Bridging Commerce and Community

One of Sundial's flagship initiatives, the SOCO Market, is introduced as a commerce-driven solution that empowers black and brown entrepreneurs. McDonald highlights its role in fostering direct-to-consumer access, enhancing brand visibility, and driving economic growth, particularly through events like the Essence Festival of Culture.

Notable Quote:

"SOCO Market is that it exists not just physically at the festival, but it exists virtually and all year long."
— Kirk McDonald [45:00]

d. Strategies Amid DEI Backlash

McDonald outlines Sundial's strategic approach in the face of DEI challenges. He advocates for brands to continue authentic engagement with diverse communities, leveraging unique insights and maintaining strong connections through events and digital platforms. He warns against brands abandoning DEI efforts, predicting that those who do will lose out to competitors who remain committed.

Notable Quote:

"If your brand doesn't care about me, why do I care about you? And ultimately that's, I think, will be the real correction."
— Kirk McDonald [43:51]

---

6. Looking Forward: Sustaining DEI Efforts

As the episode wraps up, McDonald emphasizes the necessity for brands to integrate DEI authentically into their business models. He predicts that consumer behavior will increasingly favor brands aligned with their values and identities, urging companies to adapt strategically to sustain relevance and foster growth.

Notable Quote:

"Those brands that continue doing what they learned will advance themselves and those who will take another tactic will learn something new."
— Kirk McDonald [33:03]

---

Conclusion

This episode of The Digiday Podcast offers a profound exploration of the current DEI landscape, spotlighting the challenges and opportunities brands face amid increasing backlash. Through Kirk McDonald's expertise, listeners gain valuable insights into maintaining authentic DEI initiatives, leveraging community-driven commerce, and adapting to the evolving demands of today's diverse consumer base. As the digital age continues to transform, the conversation underscores the imperative for brands to remain committed to diversity and inclusion to drive meaningful engagement and sustained success.

---

Key Takeaways:

• DEI Backlash: Major brands are facing increased scrutiny over their DEI policies, impacting budgeting and strategic initiatives.

• Super Bowl Ads: The once-powerful Super Bowl advertisements are losing their cultural impact, prompting brands to seek alternative avenues for engagement.

• YouTube's Growth: YouTube's shift towards Connected TV signals changing consumption patterns, necessitating adaptable content strategies.

• The Trade Desk's Challenges: Missing revenue forecasts highlights the volatility in the ad tech sector and the delicate balance between direct advertiser relationships and agency partnerships.

• Sundial Media's Strategy: Emphasizes authentic engagement with diverse communities, leveraging insights and commerce-driven solutions like the SOCO Market to empower marginalized entrepreneurs.

---

For those interested in the intersection of media, technology, and diversity, this episode provides a comprehensive overview of navigating DEI challenges in the modern digital landscape.

Transcript

[Kamika McCoy]

Discover the future of AI powered digital experiences. Adobe Summit returns to Las Vegas March 17th through 20th. Learn from global brand leaders like Coca Cola, Unilever, eli Lely, Marriott, JPMorgan Chase and more. Plus, choose from more than 250 expert led sessions and hands on labs, including a generative AI learning track. Use code digidaypod for $200 off a full conference pass. For more information, visit the following link bit lysummitdigitae.

[Tim Peterson]

Hello and welcome to the Digiday podcast. My name is Tim Peterson. I am the executive editor of video and audio at Digiday Media and I'm.

[Kamika McCoy]

Kamika McCoy, senior marketing reporter here at Digiday.

[Tim Peterson]

What's up, Kimiko?

[Kamika McCoy]

How are you? I'm not gonna say that it's a hellscape. It is. But this week I'll refrain.

[Tim Peterson]

Does that count as refraining?

[Kamika McCoy]

No, no.

[Tim Peterson]

I'm gonna like start like keeping track of the streak that you have. Yeah, but yeah, this, this past week has been, has been a lot, but every week is a lot. But we have some good news to talk about for this week's juicy scoops, which is your catchphrase mine, and it sounds awkward when I say it. So we're going to talk about just what, if any, were the lasting effects from an advertiser standpoint of this year's Super Bowl, YouTube's TV tipping point and the trade desk missing its revenue forecast for the first time. We also have a guest. Kimiko, you had the interview for this week. Who'd you speak to this week?

[Kamika McCoy]

I Talked to Kirk McDonald, who is the CEO of Sundial Media Group, which has publications in its portfolio like Essence, AFROPunk, Refinery29 as of recent. And the conversation was interesting and I think very timely. We talked a lot about diversity, equity and inclusion and how diversity has become the, the dirty D word, if you will, and kind of what that means for, you know, a portfolio of diverse brands, black owned companies and things like that. It's been mounting for a while, so it was nice to talk to Kirk and kind of get a 5,000 foot view of what's happening.

[Tim Peterson]

Yeah, because it seems like the whole DNI budgets or multicultural budgets would be under threat this year because I mean, even this past week the FCC has talked about going after Comcast for its DNI policies.

[Kamika McCoy]

Yeah, there's some been some back and forth with Comcast, Disney, I think there's a handful that are still standing. But there's even speculation that, you know, Costco could be in hot water for standing on its DEI Practices as well. So, you know, excited to hear what. What Kirk has to. To say around these things.

[Tim Peterson]

Yeah, no, that sounds like a really interesting, probably difficult conversation. Speaking of difficult things, it feels like it's getting harder and harder for super bowl advertisers to have much of a lasting effect. Like we talked about in last week's episode, I didn't really get a chance to watch any of the ads in this year's Super Bowl. But coming out of the super bowl this past week, it didn't feel like I really missed anything. Like I didn't notice any big conversation about the ads like there would have been in the past, like when Budweiser had the frog saying was and things like that, or Pepsi having whichever celebrities in its commercial. But you're the expert. You cover marketing. This is your day to day.

[Kamika McCoy]

Yeah.

[Tim Peterson]

Am I missing anything?

[Kamika McCoy]

You are absolutely not missing anything. Because even a couple of years ago, when you think about was it Coinbase's ad? Reddit also had an ad. I think it was Coinbase that had the QR code that crashed. But nonetheless, it was a moment that people talked about for a while. The only thing that came out of this super bowl was not from an advertiser perspective. It was Kendrick Lamar and the Drake Beef. And what's interesting here is that one, bootcut pants are back. Two. Two. What's interesting is that because there haven't been any ripple effects, right? Any memorable spots from the Super Bowl. You're seeing brands tack themselves onto the Kendrick Lamar slash Drake Beef. Duolingo made a really, really big deal of it. They had a couple of, like, social posts. You know, one of them was, like, had some of their characters singing parts of Not Like Us. There was also Zillow that had a couple of, you know, super bowl tweets happening or threads that were happening at that time. And then also Cars for Kids, the nonprofit organization for children that also tapped in.

[Tim Peterson]

Well, I guess a minor. There is a tie in there that maybe not the tie in you had.

[Kamika McCoy]

Hoped for or even wanted.

[Tim Peterson]

Yeah.

[Kamika McCoy]

But I think the premise here is that brands are looking for a way to stay relevant after the big game, which probably the biggest pop culture moment that we experience all year is the super bowl halftime show. So just as that last bastion of a monocultural moment, that's where brands are tapping into.

[Tim Peterson]

Right. And they kind of have to like. I get that part. I guess what is unclear to me is whether it's actually working.

[Kamika McCoy]

It is unclear to me as well, and I would imagine unclear to the brands Themselves. I don't, I think personally, I feel like you run the risk of flying a little close to the sun. Tapping into that, you know, given what Kendrick is saying about Drake. Right. There's been a couple of like lawsuits around like Paola and things like that. So I feel like it gets real sticky real fast. I understand brands wanting to be part of cultural moments and wanting to, to, to tap into those things, but I think there's a matter of being careful. A couple years ago we saw the Amber Heard and Johnny Depp trial and there were several brands, including Duolingo, that kind of got in some, some hot water, some backlash for tapping into that.

[Tim Peterson]

Right. And what is it? Duolingo killed off its mascot this week or something?

[Kamika McCoy]

It did kill off its mascot. It's reminiscent to me, I, when I reached out to them to say, hey, what's going on here? I was told that it's a brand marketing stunt, but it is very reminiscent of what was it, Mr. Peanut's baby nut years ago. So maybe we see a baby Duo. Who's to say?

[Tim Peterson]

Yeah, I'm just, I'm at a loss of like, who other than like the brands themselves and their agencies who are just the normal people who care about this kind of thing.

[Kamika McCoy]

That's another very good question. Besides people that are using Duo on the, on the app, I guess. But I don't know, I think that's a really, a really good question that you posed there because again, there's, there's a, A, a big precedence that brands are putting on themselves right now to, to be culturally relevant given how fast culture moves. Something that was popular on Tik Tok 2 days ago can be, you know, no longer popular. When's the last time you heard somebody say very demure. Exactly. It went fast. It came and went fast. But what has not came and gone fast is YouTube.

[Tim Peterson]

Yeah. 20. Happy 20 year birthday to YouTube. We're recording this on Friday, February 14th. This is the 20 year anniversary of YouTube's launch of the at a zoo video that they recorded, I believe at the San Diego Zoo in the San Diego area. So nearby somewhat. But yeah, YouTube had some, especially, you know, covering the TV streaming video industry, covering YouTube for, God, more than a decade at this point. YouTube, CTV now accounts for a larger share of watch time on YouTube than mobile, which was probably like a long time coming. I think anyone who's been paying attention to YouTube for the past four years or so, CTV has been growing and growing in terms of, you know, viewership and watch time on YouTube YouTube, I think, like two years ago, overtook Netflix as the streaming service that accounts for the largest share of watch time on TV screens, and YouTube has held that since then. So people are spending more time watching YouTube on TV screens than Netflix or Disney plus Hulu Peacock, like on down the list, YouTube's the top one. And now they're spending more time watching YouTube on TV than they are watching YouTube on their phones, which.

[Kamika McCoy]

That's something.

[Tim Peterson]

As someone who spends more time watching YouTube on my TV than on my phone, not super surprising to me. But Kamika, how much time. How much time do you spend watching YouTube in general and how does that break down for you between like phone, computer, tv?

[Kamika McCoy]

Tim, that is actually my question for you. What the heck are y'all watching on YouTube TV to be sp.

[Tim Peterson]

I watch a lot on YouTube.

[Kamika McCoy]

I have not found. If anybody's got any good recommendations for what I should be watching on YouTube, please let me know. But yeah, I, I'm a. I'm a second screen person. So mostly I'm on TikTok while the TV is on in the background. So the television is watching me. But it is interesting because you're. You've got like the amount of content there. I know one thing that we talked about last week is like, podcasts are becoming video podcasts are becoming a bigger thing there. Every once in a while I will turn into a video podcast and hopefully one day Digiday has its own. But in the meantime, that is one place that I could see that going. But yeah, it's really interesting to see that it has overtaken, you know, know, a platform that has, like, professionally produced, like massive budgets of content coming out and YouTube, you know, content creators and things like this, but also their own productions really coming out swinging here and landing the, what do you call it? The stick sticking the landing.

[Tim Peterson]

Yeah, no, I mean, that's kind of the thing too, because you have a lot of creators, Mr. Beast, Michelle Car, the Try guys who are spending a lot of money on their YouTube videos. And so that is kind of like the lagging indicator of people still thinking YouTube is primarily cat videos. It's not. There are plenty of cat videos on YouTube, but there's also a lot of things on YouTube that look like they could be on Netflix or on traditional tv, hbo, what have you. And what's like, most interesting to me about this TV Tipping point is I think it was like two years ago or so as CTV was becoming a larger part of YouTube viewership. I talked to some creators, some publishers, and even some Agency executives that work with brands about. Okay, to what extent are you starting to pivot your YouTube strategy more around TV than around mobile? Are you producing longer videos? Are you producing videos in 4K? Are you creating things that are more for like the living room experience than someone watching just by themselves on their phone? They're just like, no. Because even though CTV is a bigger share of viewership, mobile is still the even bigger share of viewership. So we can't be producing for the TV experience at the cost of the mobile experience. Now, I'm very interested to hear if that has changed or it is about to change, but because of this seeming Rubicon, I don't know that it's going to go back to mobile ever being the primary share of watch time for YouTube again.

[Kamika McCoy]

Yeah, that, like I said, is really interesting because I still have no idea what everybody is watching on that app.

[Tim Peterson]

But which is wild. But you also do watch traditional tv, so.

[Kamika McCoy]

I do, I do. And then not for nothing, you know, for creators, one thing that I have noticed with them pretty regularly is this push to like if you started viewing me on TikTok, you know, or YouTube shorts, depending on where the tick tock band lands. But the goal has seemingly for a lot of big creators has always been to push to YouTube where that longer form content lives.

[Tim Peterson]

Yeah. Which is where, you know, for digital, our longer form video content lives on YouTube LinkedIn too. But YouTube's really been the home of that. So we'll see how that goes. Maybe we'll have someone from YouTube or YouTube creator on the show sometime soon to talk more about this. Last thing we need to talk about from this past week is the trade desk which reported earnings. We're in the middle of earnings season. I love earnings season. Trade desk maybe not so much loving earnings season right now because for the first time in the company's history they missed their revenue forecast. Now, to be clear, revenue still grew. So it's not like the business is suffering all that much. But it was enough for investors for Wall street to start selling shares for the trade desk. Stock price to drop as a result of this, which it's hard necessarily to know what to make of it. I think. You know, Ronan Shields had a story up on Digitite talking about this and recapping what the trade CEO Jeff Green said on the earnings call about what was the cause of this. Well, not so much even what was the cause of the revenue forecast miss so much as what trade desk is going to do to try to grow revenue a bit more this Year one of the things that was called out is Trade Desk is going to try to be doing even more business directly with advertisers, which is a delicate balancing act because so much of the Trade desk business has to do with media agencies. And so if you start going to clients directly, agencies aren't going to like that necessarily. So that's going to be some potential political hot water for the Trade Desk.

[Kamika McCoy]

Yeah, I was going to say like the, to me, the most interesting point part here would be the ripple effects that this then causes and kind of when those things start to fan out, the cottage industries that have kind of been built out around that and with, you know, the Trade Desk being as big of a titan as it is, what does that kind of mean for other players in the, in the, this space, like Allah agencies and whatnot. So I think this is a to be seen, you know, thing. So we'll see those ripple effects. Given the way news is happening, I expect to see them sooner rather than later.

[Tim Peterson]

Yeah, because I mean one thing that, you know, Trade Desk called out in its earnings is, well, we still have, are waiting to, you know, hear the verdict in this Google Ad tech antitrust lawsuit. If they have to sell off part of their ad tech business, that could be beneficial to Trade Desk. But another thing that Tradesk didn't bring up, but in the past week Applovin, which is another ad tech company that's primarily focused on the mobile in game advertising space, had really solid earnings and if I remember correctly, like a lot of that was attributed to Applovin being able to diversify its advertising business beyond just like mobile apps running ads in other mobile apps to promote their mobile apps. And so if that suggests that there is potentially growing competition for the Trade Desk. Now Applovin still in a different kind of business than the Trade Desk is, but the trade desk has kind of expanded beyond its still bastion on the demand side, platform side, to strike more direct deals with publishers. Now it's going direct to clients. And so it is in a similar way to Google kind of spanning the programmatic supply chain. And it seems like so many of these ad tech companies are just kind of trying to span the supply chain where that could as much as it is to everyone's competing with one another right at this point. So. Well, we'll see how that goes.

[Kamika McCoy]

We shall see. We shall see. Those are some good juicy scoops and I appreciate that you started this conversation by saying it. We'll, we'll see if we can continue that trend.

[Tim Peterson]

Yeah, we'll see if I don't sound like a complete fool by saying juicy scoop. But Kamiko, before we go, remind me who you spoke to for this week's episode.

[Kamika McCoy]

Yes, yes, yes. We Talked to Kirk McDonald, who is the CEO of Sundial Media Group again that oversees publications like Essence, AfroPunk and Refinery29. We talked about the current state of DEI and what it means for some of those the portfolio of those brains. So I think it's a timely conversation and I'm excited to get to it.

[Kirk McDonald]

Cool.

[Tim Peterson]

Excited to hear it. Thanks Miko. Discover the future of AI powered digital experiences. Adobe Summit returns to Las Vegas March 17th through 20th. Learn from global brand leaders like Coca Cola, New Unilever, eli Lilly, Marriott, JPMorgan Chase and more. Plus, choose from more than 250 expert led sessions and hands on labs, including a generative AI learning track use code Digiday Pod for $200 off a full conference pass. For more information, visit the following bit ly summitdigida.

[Kamika McCoy]

Hello. Hello and welcome to another episode of the Digiday podcast. Today we've got Kirk McDonald, CEO of Sundial Media Group joining us. Hi Kirk, how are you today?

[Kirk McDonald]

I'm wonderful. Kimiko, how are you today?

[Kamika McCoy]

I am doing all right. Doing all right. I typically like to start off my conversations with a fun question, so if you allow me, I'm going to do that.

[Kirk McDonald]

I'm all about the fun. Come on, bring it.

[Kamika McCoy]

Perfect. You have got quite the resume. But what was dating all the way back to your youth? What was your diary?

[Kirk McDonald]

Wow, is that way of you calling me old? You know, that's the second time I've been called old today. Kimiko, someone called me uncle earlier today. Thank you. No, it's good. I love the fact I've been around a minute, but it's all right. Go ahead, go with your question. Let's see how this works out.

[Kamika McCoy]

Uncle, what was your very, very, very first job?

[Kirk McDonald]

Ooh, my very, very, very first job was I started shelving books in Rockefeller University Library a couple of days after graduating high school. Grew up in and around New York City. I am, you know, a child of immigrants. We moved here from Jamaica, from the West Indies to find and follow the American dream. And right after high school, Bronx High School of Science, I needed a full time job because I had to pay for college and I was going to go to City College here in New York and I started working at Rockville University's library. It's a medical library over on York Avenue, 60th Street. And I Would shelve books in the library. Eventually it turned into. I did a little bit of coding back then. So eventually started building and contributing to the coding of their online cataloging system. But yeah, as way back when that was my first, first job. Thanks for bringing me down memory lane. Aging me. Kimiko, well done. Great start. This is going to go well. I'm very excited.

[Kamika McCoy]

I love that. How big were those books? They seem thick.

[Kirk McDonald]

They were big. They were medical journals. So the habit for the students would be to take them down but not put them back. So yeah, didn't need to go to the gym a lot. A lot of above the head lifting to get those things in there. I was in good shape and I.

[Kamika McCoy]

Love that, love that, love that, love that. I think that that takes us nicely because I want you to walk through the rest of your career, right? You've got an interesting background. You were at PubMatic and Ad Tech business and then App Nexus and ad tech business again and Xander and now you're Group M and then Sundial. But all the while, you know, as I'm kind of researching for this, one thing that I've noticed is that there's a lot of DE&I diversity and supporting of marginalized communities through that work. So kind of walk us through how you got to Sundial and kind of how diversity played a role in all of those roles.

[Kirk McDonald]

Oh wow. Thanks. So I do feel very fortunate that I have operated at this point on the sell side. So that has been traditionally the publisher side of the business and that was my early career. It started out in magazine publishing. I started Conde Nast in a research capacity. Back then you didn't see a lot of again, I'll use the word diversity in their sales force. And that was just the way it was then. But I always felt like the place to represent things was from this position of truth. So I actually was fortunate. I landed in the research department and that research was insights into what the audience to the titles were. And that would be a big part of telling the stories to advertisers. And that research role eventually got me really interested in being part of the selling organization. And it didn't happen at Conde, but my next sell side job was at Ziff Davis and really got lots of sales training. Again, this recognition that in this sort of vertical publishing, special interest publishing in the PC industry, you could actually get greater value for audiences and if you understood audience data, it mattered. Believe it or not, all of these things started tying together even as I went on to cnet. Another Sell side job early, early Internet time. And all through my career I've been in pursuit of why do consumers consume content, where and when they do, and how do those consumers eventually form communities and what are the need states of those communities. And if you as a title or a publication could meet that need state, your value would be associated. So that was on the sell. I did end up on the tech side because I was also curious to understand, well, how could technology now not just make the audiences and the communities available in any aggregate place, but how you could actually specialize which messages they saw. If you could deliver and bring the right ad to that community or to the individuals in that community, you'd have higher return on the advertising side, but you'd also be meeting the needs of the community differently. So that was great. And I feel fortunate to think I have a very deep understanding of the issues on the sell side. Sophisticated enough understanding of how technology has enabled media to work in a more personalized way then most recently on the buy side to run Group M. Really amazing opportunity to run that agency holding company for North America and really see all of the challenges and the friction in the way that the buy side has to operate as this valuable intermediary between brands and environments and audiences they seek. So it's been great. What's the through line curiosity about consumers content and way they consumed a passion for how communities have similarities, mostly revealed in the way they express their need for content and information. And that has been an important part of me understanding the needs of underserved communities, underrepresented communities. Why Sundial now? I'm excited to be here because of our commitment to serving underserved communities, meeting them in their need states. Especially because with titles like Essence, we've been doing it for 55 years, acting as champion, activist, advocate, empowering tools that has met the needs of Black women. Acquiring Refinery 29. 20 years of recognizing the importance of how women are seen and all the hats that she wears, not just as mother, but business leader, entrepreneur, partner, and meeting and understanding the content that she needs to be empowered feels like a really fortunate opportunity. And I couldn't be more excited about what we do there. How we then connect that to commerce is really powerful. Kimiko. So that's sort of like the full circle of it all. And I'm excited about what we get to do.

[Kamika McCoy]

Absolutely. Absolutely. I think you and I first connected a couple of weeks ago during one of the most recent waves of the changes to diversity, equity and inclusion space. Right. And I think why I was excited to talk to you for this episode is that you've come from an interesting purview of like ad tech, publishing and whatnot. Kind of giving a 360 view here. So I would love for you to kind of walk me through where you think we currently sit when it comes to marginalized communities and the retooling or rollback, depending on who you ask, of diversity, equity inclusion efforts.

[Kirk McDonald]

So we are in the middle of it, even when we and I loved our conversation last time because it's great, because you provoked original answers, because we're in the middle of reacting to this moment. Whether it's a rebranding effort, like a conscious effort to say, hey, the word diversity is a divisive word. We don't want to use diversity and we want to rebrand this, or it's very intentional, which is, hey, we are rolling back. And rolling back simply means that there was a time before this that we liked the balance and we want to go back to that version of it. I do think that either as a rollback or as a rebrand, the effort has to recognize the reality of the moment. And I like to live in the reality. So if we go all the way back to my career that starts out in research and insights, understanding the reality of the marketplace or the communities you're speaking to is essential to actually not just speak their language, but have permission and trust to be valuable and important to them. Brands today, regardless of who you are, have to recognize that the current general market is not the old general market. The new general market is actually made up of a bunch of different communities. Its complexion has changed. It is in control of how it is perceived. Its genders aren't binary anymore. And that new general market that has said these are the ways that I show up will insist to brands, if you want my dollars, you're going to actually have to actually speak to me in my language and in a place and in a way that I trust you. And for any brand and business, that's either opportunity for you to capture, share or decide that that particular customer isn't important. And I think your actions will show it. So for a brand that makes the conscious decision to say, I'm going to walk away from you unless you think of your gender in the two ways I think of it, or I'm going to walk away from you because you are insisting that you have unique needs for your hair, unique needs for your skin, unique needs for the way you want to purchase clothing, I think those brands may find out that those Communities choose to do their commerce differently and we'll see how that plays out. And I still think we're early enough here that some of the brands are trying to say, well, I'm going to make these broad statements and then we'll see what happens. It'll be interesting to see whether those communities start saying, you know what? I think we've seen this movie before and I think we know what this feels like. So we'll take our dollars either as individuals or as communities, and we're going to shop, we're going to interact where we feel welcome, where I feel recognized, where I see someone that feels like I'm home. And if, and if that, you know, if that works out, I think then brands will react. I mean, ultimately I'm a believer in capitalism. And then at some point you turn around and, you know, you, you, you shift to that, you shift to that, to that consumer's needs.

[Kamika McCoy]

Absolutely. Your background going back there touches on some responsible media investment. Right. Those are some projects that you spearheaded at Pubmatic and then obviously, you know, being at Group M Media investments. So talk to me a little bit about in kind of the waxing and waning, the back and forth of the pendulum swing of D E N I. Right. Because it's a pendulum. Talk to me a little bit how you've seen over the years the money move in that does a pullback and a lean in things like that over the years.

[Kirk McDonald]

So I think over the years the good news is that it's when you can actually understand the flow of the river and then find a way to kind of optimize it, that you can create opportunities for yourself. Everyone has to find a business efficiency in the way that they want to operate their business. And I think that that has been a challenge for companies to do the different thing and make the changes to respond to the new marketplace. The new marketplace has said for a long time, and again, I'm going to do this without using the word diversity. The new marketplace has said for a long time is that our communities actually have different needs. And if you can meet the needs of a particular sub segment inside the broader audiences you're looking for, you can actually have accelerated results. When I've kicked off diversity initiatives, sorry to use the word, but they were comfortably branded as diversity initiatives. It was to encourage brands to realize there is a sub community inside the audience you're looking for that isn't identified based on just an audience demo or a psychographic profile, but really on needs that are either cultural needs, social needs, that speak to them in a different way. And if you can actually speak to that community, the community will respond in kind for you. That's where brands have been very, very successful. And there are countless cases that have proven that those initiatives and brands that have leaned into this in an authentic way have become more resonant to particular communities and have been rewarded for that disproportionately in some cases with brands. And we have those case studies and believe that we will continue to demonstrate brands that will do that going forward. We know that those needs show up, especially on the commerce side, and it's why we've got our SOCO market. Right. So SOCO market is not just an environment for black and brown entrepreneurs. It's a marketplace for the communities that want to actually find unique products that are not available in other environments and then they can respond to it. So I believe I've always been a driver and advocate for responding to the needs of the communities that you have products and services for, because it is a good business decision. If it also happens to support social causes and it also happens to be just sort of a feel good in your heart, that's fine.

[Kamika McCoy]

But.

[Kirk McDonald]

But if you do it for business reasons, then I think it sticks and lasts. Anything else feels like the kind of program that you then start and you stop. Right now we're going through a moment where we're trying to pretend that the programs that have been branded dei, all of them were kind of like feel good moments and not recognizing that they really were opportunities about making commerce happen for the companies that were looking to meet the needs of communities uniquely going forward. And to be clear, this current market or this current generation, and as we go from X, Millennials into Z and Alpha, increasingly are going to spend their dollars not just with a provider of a product or service, but with someone who they feel that they have aligned with purpose and align with mission and. And brands also are going to have to recognize how they respond to that moment as well.

[Kamika McCoy]

I think what's interesting in moving into kind of your role as CEO of Sundial Media Group now is that, you know, you've. You've seen how money has flowed. You've overseen how money has flowed. Ad investments, media investments have flowed. But now you're on the side of it, where Sundown media Group oversees AFROPunk, Essence, and others who are on the receiving end of those ad dollars. Right. So talk to me a little bit about, in kind of this, the current marketplace that we're at. Right. How are those shaping up? Do the commitments that once stood, you know, post 2020 still stand now in 2025.

[Kirk McDonald]

Yeah, you know, we mentioned this a little in our last conversation. So for, for those who are hearing the podcast, they should go back and read your article. I think the, the reality is that we don't know yet. There's a lot of press announcements. All the press announcements have not actually gotten themselves all the way down to we are going to stop spending this way and spend another way. Remember, even when they shift spending to say, look, I'm going to put an intentional extra percentage of my spend to support black media or I'm going to intentionally percentage of my spend to make sure that we get to authentic women led businesses where that voice speaks to how the audiences respond differently. All of those were always measured against the performance of media on the back end. So it's not that anyone turned around and said, oh, and I'm going to forgive the metrics of accountability on the media. So if they worked, I don't know why you would turn around and now undo them simply because you're following what you think is the new direction of the herd. And I really just don't believe that that should happen. We've now put a lot more effort and we will continue to do this in supporting that. We sit in a place where we can bring unique insights into how our audiences behave. They trust us in a way and they tell us things through our audience panels that they just simply don't say elsewhere. They speak differently because we speak their language. And I will bring that to brands and they will use that to activate. So we will continue doing going forward on the back end, whether it's our sponsorship opportunities. We are coming up with an event where we will do Black Women in Hollywood. This is an amazing event. It recognizes those who don't get recognized and sometimes are not on the events that get broadcast tv. But we've got amazing distribution partnerships. We're going to do our Black Women in Hollywood event here. And that community, when it gets together, speaks with each other in a way that is unique. And for brands who don't see that value, I would challenge then you don't want the commerce that the black woman generates because that's what that room will represent. And the same thing for our properties in the Hispanic space and the same thing for our properties like across Refinery 29. They offer commercial value to any brand that supports us. So again, if after George Floyd post 2020 and the pandemic, you believe you did tactics that were only unique for that moment if you believe that the world now is not 2025, but actually 1975 or some other time, then I think boards and those businesses will try to think and act accordingly. If the stats are right and the data is right, that the new general market is very different, it is a different complexion, it is a different selection of gender, it's a different need states. In terms of the things that I think resonate for me, if it is a different overall expectation, then I think those brands that continue doing what they learned will advance themselves and those who will take another tactic will learn something new.

[Kamika McCoy]

Yeah, we've touched on the acquisition of Refinery 29 a couple of times and I do wanna make sure that we hone in on that for our read. An acquisition that happened last year. Talk to me a little bit about what's kind of been the latest since then. How has that been going? Are there plans moving forward?

[Kirk McDonald]

Oh, we are so excited about Refinery 29. This will be the 20th year anniversary for the property. A property born in a time where it wanted to say that the voices of women had to be heard in the boardroom. Had to be heard because we were entrepreneurs, they were entrepreneurs, had to be heard because they wore many more hats than we were pretending they did. That that brand, that property, maybe now more than ever before, needs to go make those cases again to champion right to bodily autonomy, right to making health decisions for yourself, right to actually being recognized for equal work that you do. There are a couple economic reports out there that speak to the fact that over the next five to 10 years, we're going to see the most significant shift in wealth as baby boomers start handing their dollars down into the next generations. And that the greatest recipients of those shifts are going to be women. It's an important time, we think, to have a brand like Refinery29 again saying, look, here are the causes that are important to women because they will actually approach how they deal with their new accumulation of wealth differently than any other group before them. We think that's uniquely different for black women than for non black. We think it's going to be different for Hispanic as well. So we're really excited to have inside of Refinery 29 the Somos focus on Hispanic and again, the complementary nature of Unbothered that works well with what we do inside of Essence Ventures. AfroPunk, you mentioned again, a huge community of creators that are really living at the forefront of how tech, technology, innovation, content is going to shape culture. Excited to see that property also celebrate a big 20th anniversary this year. So we kind of feel like, oh, and essence will be 55. Right. So we got big anniversaries this year across the portfolio. And then, remember, for us, we don't think of it just in terms of content because we're more than just a media company. We're an intelligence and insights company. We're a technology innovation company now. And ultimately, this is all about taking those communities all the way through the experience, all the way to commerce. So it's how content communities convene, shape culture and drive commerce. And that's what the family of properties do. That's why, again, something like a SOCO market is built to capture this and to create a true symbiotic partnership between brown and black entrepreneurs. And again, a community that has been seeking their products and services and will lean in, we think, more intentionally now than they have even in the past, for all the reasons that it's just really noisy and you're going to look for safe, familiar places to go.

[Kamika McCoy]

Yes, I think that's an important thing to note here because you're not the first person that I've talked to that's kind of said this, like, as much as the, the walkbacks are happening and the, you know, and I. Diversity comes a dirty word. There's still spending that's happening at least this quarter. Right. So kind of what does that mean for, like, the strategies as far as, like, you know, pitching for ad dollars and advertisers to work with these brands, especially with, like, unbothered refinery, 29, things like this for, you know, 2025. Does. Does the pullback, like I said, the retooling or walk back, depending on who you ask, kind of.

[Kirk McDonald]

I think that, again, I don't know that the pullback, you know, what the pullback is going to affect those strategies, but I think that any dynamic change in the marketplace should affect strategies. So our strategic approach this year is not what it was last year, nor was it the year before, where we actually have demonstrated value in the past, has to be foundational to the new places we'll demonstrate in the future. You can't sort of say, well, we're not going to do that, but we're going to do this. I feel comfortable that our portfolio of brands, the unique insights we'll bring into the conversation, for the brands that have chosen to lean in, we have an insights division that really tries to help our brands understand not just the particular audience to speak to, but how to speak to the audience, which I think is maybe even more important than just saying we want to get women in this age break with this particular domestic situation. It's, well, what are the words that resonate for her? What are the products that actually resonate for her and the price point? So we know that we have a unique value proposition to be able to deliver that. And then with our experiences, they're not getting less interesting or less engaging. The in real life experience and live experiences is a growing opportunity. And it's because brands recognize that when people convene and when you actually can bring a lot of attention to a single moment in time, there is a huge opportunity. We have multiple of those cultural convening moments over the course of the year. So from Essence Festival to beautycon to the Afropunk event happening here, we also do Afropunk in Bahia. We will bring back an exciting return this year to 29 runes, which has been away for a while. Our GU Girls United events. We know that our in real life opportunities now with our ability to do distribution and reach so that we have video assets to go along with that, that's an intentional shift in the way we're going to do our events this year. So not just the cultural moments, but their distribution on the back end. We think that, yeah, even if your strategy is changing, it's still too compelling an offering. And unless you're going to stand up and say, well, we think our product's great and we don't have to market to women, then make that statement. But if your brand doesn't need to have women as part of your commerce target, then okay, that's fine. If you don't care about black women, you don't care about Hispanic women, you don't care about creators, the people who are shaping the edge of culture.

[Kamika McCoy]

Yeah.

[Kirk McDonald]

You know, I think what will happen this year is all those people are going to realize, well, if your brand doesn't care about me, why do I care about you? And ultimately that's, I think, will be the real correction. So, yeah, I hear all the press right now and I know there will be some pullbacks and what felt like diversity programs will go away. We have a compelling value proposition that I think cuts through that noise for those who want to listen to it and those who don't, they should know that their competitors who listened will win disproportionately. That's all.

[Kamika McCoy]

Yeah, I want to, I want to lean in on the SOCO market because at the same time that there are conversations about like in, in the social media conversations that are happening about, well, let's boycott the brands that are no longer supporting us. Right. The ones that are retailers, excuse me, that are pulling back on these DE and I initiatives. The question then becomes, right, well, where do we spend our money and do we commit to diverse owned suppliers? And I would imagine that SOC then comes up here. Right. As a place for people to, to, to sell and entrepreneurs and creators and whatnot. So talk to me a little bit about how I guess SOCO market can kind of pitch itself in, in that gap.

[Kirk McDonald]

Sure. You know, again, this is about economic impact and growth of commerce. So it's this ESSENCE powered initiative that sits under the sun. AL Group. It's a commerce driven solution. It's empowers black and brown entrepreneurs giving direct to consumer access, brand visibility, corporate partnerships which really are driving long term business growth. We've seen vendor participation grow over 150% in recent years and the entrepreneurs there are beginning to grow even broader distribution as a result of that. Just as an example, when we do the Essence Festival of Culture, which happens annually around July 4th weekend, we do it in the city of New Orleans. We love doing it there. It drives real economic growth for that city and SOCO market is a part of that. So we generate over 340 plus million dollars annually for New Orleans and Louisiana. That's a significant contribution to that community. And the benefits largely in this case do sort of resonate and land with black owned businesses who participate through SOCO Market or actually are local to the, to the, you know, to the geography of New Orleans. So less about do it because of its social good, do it because, you know, hey, blacks should buy with blacks. Do it because you can meet a black or a brown entrepreneur that is making and creating a product or service that is unique, that is different, that is meeting your unique needs. And when you do that and you spend with them, they also benefit. And there has to be a point of aggregation. And SOCA market is that it exists not just physically at the festival, but it exists virtually and all year long. And we are excited about the kind of growth that we're seeing in that part of our business as well.

[Kamika McCoy]

Absolutely. Kirk, you know, I could talk to you all day, but I don't want to hold you hostage. This was, I don't want to hold you hostage. I, I really appreciate you joining us on, on the show and I hope to talk to you again soon.

[Kirk McDonald]

I would look forward to that. Thanks so much for being such a gracious host and I look forward to listening to the podcast Cheers.

[Kamika McCoy]

Well, that brings us to the end of this episode. Of the Digiday Podcast. Thank you to everyone for listening. And please don't forget to share this episode with someone who you think would enjoy it. You can even rate us and leave us a comment on Apple Podcasts. We'll be back next week with another episode of the Digiday Podcast. Thank you so much for joining us.