Diversity Representations in Advertising: Enhancing Variety Perceptions and Brand Outcomes

Diversity, equity, and inclusion (DEI) initiatives have been on social equity agendas of firms for some time, but progress has been limited. We make a business case for DEI, showing its representation in firm communications has important implications for marketplace outcomes and consumers’ perceptions of, and behaviors towards, the firm. We show that depicting observable diversity of customers (e.g., in race or age) in advertisements creates a perception of greater brand creativity, which in turn improves brand impression, and willingness to pay, use, and choose the brand. By leading consumers to believe the brand satisfies more diverse needs of observably different customers, DEI representations in ads increase perceptions among observers that the brand creatively offer greater product variety to manage diverse preferences. The findings are important as they suggest that firms can not only achieve their social responsibility goals by increasing diversity but can also improve their bottom line.