Marketer Steve Stoute: Industry Lip Service to Diversity Isn't Enough

“I’m not going to allow that industry which has completely been ignorant to diversity — to continue to say, ‘We gotta do better,’” says Steve Stoute.
Meredith Jenks

“I’m not going to allow that industry — which has completely been ignorant to diversity — to continue to say, 'We gotta do better,'" says Steve Stoute.

The music exec turned marketer — who helps top brands plug into culture — is demanding ad agencies show their work: "Show me a picture of your board."

In February, back before the pandemic upended life and George Floyd’s death ignited a national referendum on racism, advertising executive Steve Stoute traveled to Los Angeles for the type of whirlwind visit that had long ago become routine. Stoute’s day started at Staples Center with an emotional memorial for his friend Kobe Bryant, whom he once signed to a record deal. Then he was off to a meeting at Disney, the fruits of which wouldn’t be revealed until late August, when the entertainment giant announced a strategic partnership with Stoute’s marketing firm, Translation.

By late afternoon — when I met Stoute at the Waldorf Astoria Beverly Hills — he was huddled on the hotel’s restaurant patio with a group that included LeBron James, his producing partner on the 2018 documentary Student Athlete. After Stoute settled into a booth and ordered a green juice, football phenom Chase Young (who would go No. 2 in the NFL Draft two months later) stopped by to shake his hand and chat.

But it wasn’t until an hour later, when Stoute met Drake’s manager, Future, for an evening of backgammon, that it occurred to me he might be the most connected man on Madison Avenue — either that, or he knows how to put on quite a show. "My network is important because I need to always be close to what is happening in culture and understand where it’s going," he explains.

Stoute, 50, is a maverick in the buttoned-up, majority-white world of brand marketing. A former music manager and record executive who guided the careers of Nas and Mary J. Blige, he jumped into advertising at the turn of the century because he sensed a lucrative opportunity to help brands interpret Black culture, particularly through the exponential growth of hip-hop. In the years since, Stoute has styled himself as a key connecter at the place where media, technology, music and sports meet.

"More than anyone, Steve has the ability to be ambidextrous," says Michael Kassan, CEO of consulting firm MediaLink, who remembers sitting on Stoute’s couch and brainstorming when they were both dreaming up their businesses in the early aughts. "It’s a special gift to be able to have cred in so many different areas."

It’s the ideal place to be now that the country is waking up to — and media and entertainment companies are looking to more fully embrace — the ideas that Stoute has been talking about for years, particularly the argument that Black culture is the new mainstream, which he made in his 2011 book, The Tanning of America: How Hip-Hop Created a Culture That Rewrote the Rules of the New Economy. "The way media is fragmented, they don’t see any way that a 17-year-old African American in Compton and a 17-year-old white kid from Greenwich, Connecticut, can be moved by the same thing," he says. "I’m on a constant quest to blow that up."

The Queens-born Stoute founded Translation in 2004, a year after he helped McDonald’s sign Justin Timberlake to sing the "I’m Lovin’ It" jingle. Sixteen years later, the company has grown to more than 200 employees, with offices in Brooklyn and San Francisco (which closed at the start of the pandemic). Its clients include AT&T, Kaiser Permanente and the NBA’s New York Knicks.

Gaining access to Stoute’s network is part of the appeal of working with Translation. "When we needed to make a connection, Steve would be there to help us," says State Farm chief marketing officer Rand Harbert. Translation handles some advertising for the insurance agency, including its NBA business, and also helps with its Neighborhood Sessions concert series, which brought Jennifer Lopez back to the Bronx earlier this year. Harbert says Stoute often goes above and beyond his role as a creative exec. "When you’re a client of Steve’s, he’s thinking about you all the time."

In 2017, Stoute persuaded Google parent Alphabet, venture capital firm Andreessen Horowitz and 20th Century Fox to invest $70 million so he could build Translation’s music arm, UnitedMasters. It offers a platform where artists can circumvent restrictive label deals but still distribute their songs on Spotify and Apple Music. In mid-August, UnitedMasters struck an arrangement with TikTok to serve as the distribution partner for musicians who emerge from the social video app. UnitedMasters currently works with some 500,000 artists. Not all of them break out, but UnitedMasters — which typically takes a 10 percent cut of revenue — was behind the rise of indie rappers NLE Choppa and Lil Tecca, who both ultimately signed with labels after they blew up. Another artist it has worked with, Tobe Nwigwe, gained attention in July for a track about the police killing of Breonna Taylor.

"Even though Steve has worked for record companies, he really is a serial entrepreneur," says Jimmy Iovine, who hired Stoute at Interscope Records during the mid-1990s. Of UnitedMasters’ viability as a label alternative, he says, "Steve’s got to take it the rest of the way, and I believe he can."

Another piece of Translation’s business is a fledgling data operation that can gather information about the music resonating with listeners and package those insights for brand clients looking to be the first movers on the next big consumer trend. "Artists are the guys creating culture," notes Stoute.

Though the pandemic has hit the marketing world hard — Forrester estimates that ad spending could decline 25 percent this year — Stoute says Translation’s business has remained relatively steady thanks to its clients, which are in industries like insurance and telecom that were impacted less than, say, travel. The execu- tive, who spent the first three months of the novel coronavirus crisis in Miami with his wife and children, avoided layoffs but did conduct some furloughs. The company also restructured employee compensation to offer a smaller base pay but with larger bonuses tied to company performance. In the middle of it all, Translation formed a strategic advertising partnership with Disney and signed Beats by Dre as a new client. In the middle of it all, Translation formed a multiyear advertising partnership with Disney to help brands reach more diverse audiences and signed Beats by Dre as a new client.

Working with Stoute means accepting his penchant for speaking his mind. "We don’t always agree," acknowledges Harbert, "but at the end of the day, you are better because you had a conversation with Steve."

Stoute — who in 2011 took out a $40,000 ad in The New York Times blasting the Grammys for being out of touch with the culture after the awards show snubbed Kanye West, Eminem and Justin Bieber in top categories — clearly enjoys playing the part of provocateur, even if it sometimes gets him in trouble. Not long after he began working with the Knicks, he implied during an ESPN interview that the team would fire its interim head coach. The organization had to defuse the situation by downplaying his influence over personnel decisions. But the criticism didn’t stick to Stoute for long. "I’m a marketing guy," he says, suggesting that it was all part of a ploy to get people talking about the Knicks. "My job is to make them relevant."

As Stoute turns his attention to extinguishing the advertising industry’s discriminatory practices, his brazenness could go a long way. In June, he published an open letter calling on the advertising industry to reckon with its long history of marginalizing Black consumers while simultaneously coopting their culture to sell more products. Now, he plans to hold the big agencies’ feet to the fire.

When we catch up by phone in August, he tells me he’s spent the better part of his summer penning a set of diversity recommendations that he’ll soon ask brands to push their agencies to adopt. His guidelines include hiring more Black talent in senior leadership roles and reimagining the role of the chief diversity officer as one that directly impacts the bottom line. He’s also advocating for budgets to be reallocated to increase marketing focused on African Americans in categories where they drive consumer spending.

Saying "We gotta do better" isn’t enough, asserts Stoute, explaining that accountability goes far beyond the black boxes that scores of brands uploaded to their Instagram feeds in a show of solidarity with Black Lives Matter. "You want to show me a picture of you blacking out your Instagram? Why don’t you show me a picture of your board? That’s commitment."

A version of this story first appeared in the Aug. 26 issue of The Hollywood Reporter magazine. Click here to subscribe.