Insightful Tips for Thoughtfully Marketing to LGBTQ Customers

If you’re going to go where the money is—to pursue the greatest spending power—you’ll be joining an ever-increasing number of companies (still somewhat quietly) reaching out specifically to lesbian, gay, bisexual, transgender, and queer consumers.

In many cases, these consumers have a two-person household, each member with above-average education earning above-average incomes. And many have no children to raise, so they have a lot more money left over every month than their heterosexual counterparts with families.

I’m willing to say here what hardly anybody else is: The vast majority of marketers are heterosexuals who may profess having no problems with LGBTQ people but who are, in truth, uncomfortable about the idea of designing advertising and marketing programs to attract them as customers, clients, or patients. If, for your own nonbusiness reasons, you have no interest in or willingness to deliberately and specifically market to affluent gays and lesbians, just know it’s a bad business decision and, if you’re running a business in which there are shareholders other than yourself, a fiscally irresponsible decision.

Mainstream America includes gays and lesbians. This doesn’t, however, mean that they’re a fully absorbed group unresponsive to targeted marketing and specially directed messages. To the contrary, they consistently reward those marketers who make a special point of designing unique advertising to appear in the publications only they read and creating especially gay-friendly sales and business environments. The trick, as it is when appealing to any specific group, is not to be condescending or clumsy.

Quick Market Facts

• Research verifies that 80% of gay people have incomes above the national average; 40% earn more than $100,000.00 a year.

• The combined buying power of LGBTQ adults in the U.S. as of 2016 exceeds $915 billion and is rising.

• LGBTQ consumers spend more than $64 billion a year on travel. The travel industry was one of the earliest and most pro­gressive and aggressive industries to develop product offerings, advertising, and marketing specifically aimed at the LGBTQ consumers. For instance, Harrah’s Entertainment started aggressively marketing to gay men 18 months after the extensive research revealed they spend an average of 30% more than straight men when traveling. To put a bit of money math to that statistic, you could have 1,000 straight customers at your resort each spending, say, $2,000 or 1,000 gay customers each spend­ing $2,600 The net difference is $600,000. Multiply that by 52 weekends, and you get $31.2 million. As you can see, who you bring through your doors matters a lot. This applies to you regardless of your business category—travel, restaurants, clothing store, furniture store, financial plan­ning, whatever—both as a general principle and, specifical­ly, regarding gay and lesbian consumers. In many catego­ries, gay people are worth more than straight people. Marketing to the gay and lesbian population is, in its essence, taking a shortcut to a more affluent, more freely spending clientele.

• Gay consumers are twice as likely to buy a vacation home, six times more likely to buy and have installed a home theater system, and eight times more likely to own multiple mobile devices and computers than heterosexu­als.

• LGBTQ households make 10% to 20% more shopping trips to malls, stores, and other retail locations than the average U.S. household.

• In B2B spending, 30% of LGBTQ employees and executives control budgets or purchasing decisions. 60% of those people surveyed say that the reputation of a ven­dor company for being LGBTQ-friendly affects purchas­ing decisions.

Marketers ignore or resist all this to their detriment.

How to Match Media with This Market

The top three ways the LGBTQ consumers are likely to learn a business is LGBTQ-inclusive are:

• Advertising specifically in LGBTQ media (49%)

• Articles and news stories (47%)

• Sponsorship of LGBTQ charity events or organizations (41%)

Affluent LGBTQ consumers are more engaged online than the general population, so reaching them requires more attention to and use of online and social media. In comparison to the general population, they’re 1.8 times more interested in receiving advertising via their mobile phones, 2 times more connected by hours in a day, and 1.5 times more likely to post and consider online reviews.

But can outright target marketing work?

Yes.

The automaker Subaru turned their struggling company around by advertising to a group of consumers other car companies were ignoring: lesbians. Internal research showed that a surprising number of their customers were lesbian, so the company crafted advertising for those buyers. Subaru ads featured captions like “It’s Not A Choice. It’s The Way We’re Built,” and utilized openly gay celebrities like tennis star Martina Navratilova.  

Message-to-Market Matching

Any marketing outreach to a particular group of target consumers has to begin with striving to understand the target audience and organize it into manageable subgroups.

Community Marketing & Insights has been conducting LGBTQ research for 29 years. They divide the marketing into three identities and three generations, producing nine sub-markets:

1. Gay and bisexual men (46% of the market)

2. Lesbian and bisexual women (also 40% of the market)

3. Gender-expansive including everybody else but hetero­sexual (8% of the market)

The generation divides are:

• Millennial (born 1981–1999)

• Gen X (born 1965–1980)

• Boomer (1942–1964)

A closer look at the identities, in brief:

• Gay and bisexual men. Twenty-six percent are legally mar­ried, another 17% are in a relationship and living with a part­ner. They have the highest incomes of any LGBTQ group; more than half earn upwards of $100,000.00 a year. They’re concentrated in urban/big city ZIP codes.

• Lesbian and bisexual women. Thirty-nine percent are legally married, another 18% live with a partner. About 30% have incomes above $100,000.00. There’s a broader geographic dis­tribution with this group, which includes medium-sized cities and suburban areas.

• Gender expansive. Thirty-one percent are legally married, another 15% live with a partner. They rank lower in income, net worth, and home ownership than the other identities.

Age brackets obviously matter, as they do with the entire population, and in much the same ways as with overall population.

by Dan S. Kennedy