Promoting to gays is no longer a walk on the wild side.
“Gay marketing has really come out of the closet,” quips Wes Combs, president and co-founder of Washington, DC-based Witeck-Combs, a research and strategic planning agency specializing in marketing to gays. “Five years ago, a company that said it would promote to gays set the marketing world on its head. Today, if a brand isn’t at least considering how to sell to gays, they’re really missing out.”
Somewhere between 15 and 17 million U.S. citizens are openly gay, according to Witeck-Combs. For the first time last year, the Census tallied households with same-sex partners, and found 1.2 million (although the actual figure is undoubtedly higher). Gay consumers command $450 billion in buying power, according to Witeck-Combs.
This is a demographic with a strong self-identity. “We’ve found that, even among minorities, gays identify themselves by their sexual preference before their ethnicity,” says Jeff Garber, president of Syracuse, NY-based market researcher OpusComm Group.
It’s also a group that does its homework on brands. “Not unlike other minorities, gays are not used to getting attention from marketers,” says Combs. “[So] they’re often cautious about why a company wants their business.”
Leading gay publications such as OUT and The Advocate compile lists of lifestyle-friendly companies, as well as lists of those not so enlightened. For instance, American Airlines, Fort Worth, TX, soared into the top spot in the early 1990s as the preferred airline of gays not from targeted marketing but because it was the first airline to offer such policies as same-sex partner benefits and be-reavement fares. On the other side, rival United Airlines, Chicago, is still attempting to undo the damage caused by its challenge of a San Francisco ordinance on same-sex partner benefits a few years back — which prompted a three-year boycott by the gay community (United began offering same-sex partner benefits earlier this year).
Many marketers take cues from their own ranks, through employee advocacy groups such as American’s GLEAM (Gay, Lesbian, Bisexual, Transgendered Employees of AMR) and General Motor’s GM Plus.
Even Coors Brewing Co., Golden, CO, a brand not historically known for progressive politics, has been courting the gay and lesbian market for more than a decade; Mary Cheney, the openly gay daughter of U.S. vice president Dick Cheney, served as the company’s corporate relations manager in the 1990s before leaving to stump for her father in the 2000 election. “As far as sweepstakes and contests go, we really don’t do that specifically to the gay community,” says Coors spokesperson Aimee St. Clair. “We focus more on sponsorships such as Gay Pride events and contributions to nonprofits.”
Some marketers are finally getting up to speed on how to mine their own customer files for information on gay consumers. “The travel industry has taken the best advantage of gay marketing,” says Combs. “Initially, there was a lot more data available on gay consumers from airlines and rental car agencies [which could track bookings from same-sex couples] than anywhere else.”
Minneapolis-based RSVP was a pioneer in the gay travel market when it launched in 1985. The travel wholesaler books between 4,000 and 6,000 gay-themed cruise vacations each year. “We don’t just charter a ship, we take it over and plan the whole agenda,” says director of marketing Paul Figlmiller. RSVP is also called upon to provide the prize trips for gay-themed contests from marketers as disparate as Miller Beer and the International Gay Rodeo Association.
According to Witeck-Combs, 72 percent of gay consumers prefer brands that pitch them directly.
“This is a market that’s open to brand loyalty,” says Garber. “That’s a new concept for mainstream marketers, whose audience has been bombarded by all sides and become pretty jaded.”
However, it takes a lot more than a gay-tweaked sweepstakes or sampling program to gain that loyalty. Marketers who are serious about targeting the gay demographic need to demonstrate they are concerned about the audience’s needs.
Take American Airlines, which has become the market leader without doing much in the way of targeted promotion. “Whenever I give a presentation to gay groups, I ask who’s seen our ads or promos, and 70 percent of the hands go up,” says Rick Cirillo, American’s vp-global sales and marketing of gay and lesbian communities. “But we don’t advertise in gay media. I have to point out that they haven’t seen our ads, they’ve seen our logo as part of ads from organizations we sponsor.”
Cirillo sparked American’s outreach to the gay community in 1993 by helping to institute the aforementioned same-sex policies and raising the airline’s visibility within the community. “We started off by sponsoring anything we could,” he says. “Since then, we’ve managed to switch the ‘sponsor’ tag to ‘official airline’” as often as possible; one example is the 2002 Gay Games in Australia (even though marketing partner Quantas will actually handle travel duties).
Subaru, meanwhile, has succeeded through high-profile marketing and innate satisfaction with the product. Since 1994, the Cherry Hill, NJ-based car manufacturer has focused on niche marketing to five key customer groups: professionals in healthcare, education, and technology, a segment called “rugged individualists,” and gays.
“We’re in your life, not just in your face,” says Subaru director of national marketing Tim Bennett. “We don’t just buy an ad, we become part of the lifestyle.” That latter strategy includes being founding sponsor of the Rainbow Card, a credit-card service started by San Francisco-based Visa USA and former tennis star and gay advocate Martina Navratilova; Subaru offers Rainbow cardholders up to $3,000 off a vehicle purchase.
When Chicago was bidding to host the 2006 Gay Games earlier this year (it eventually lost to Montreal), the organization’s site inspectors toured the city in Subarus. And the ads the brand runs in publications like Out and The Advocate are customized: a current one unites a common gay expression through the brand’s own outdoorsy reputation through the headline, “Get Out. And Stay Out.”
Drinks with a Twist
Alcohol brands have been among the most prominent in marketing to gays, as well as the earliest. Absolut Vodka, for instance, began advertising in gay publications in the 1970s.
However, the recent popularity of new Cabana Boy Rum in the gay community came as a pleasant surprise to Lewiston, ME-based White Rock Distilleries — honestly.
“A lot of people don’t believe us, but we didn’t create Cabana Boy with gays in mind,” says White Rock vp-sales Bill Dabbelt. “Our ad agency [Lewiston-based Swardlick Marketing Group] has a lot of female employees, and they suggested the product for women.”
In early meetings, White Rock sales staffers assumed the product was for a gay audience — much to the surprise of company brass. But the assumption proved true in early tests, which led White Rock to alter the promotional schedule to target both young women and gay men.
Since launching in select markets last March (the brand went national this fall), Cabana Boy has relied primarily on local on-premise activity at gay-oriented nightclubs and bars to encourage trial. In New York, for instance, the brand hosted parties and bartender contests on Fire Island (a vacation retreat popular with gays) giving away T-shirts, beach towels, and free samples. In other markets including Seattle and Tampa, gay bars hosted weekly games and prize giveaways, highlighted by a modeling contest dubbed Search for the Perfect Cabana Boy and a Fun in the Sun Sweepstakes offering a five-day, four-night trip for two to Jamaica. (The Search will roll out nationally in 2002, when White Rock may use a variation on its theme at Spring Break to reach both men and women.)
While Cabana Boy was embraced immediately by gays, it did meet some resistance among heterosexual bar owners. “We had some who didn’t want us to show up with male models at all, just females,” says White Rock sales manager Lee Atherton. “They were pretty homophobic about it. But then they realized they needed the male models to appeal to their female customers, too.”
White Rock estimates that gay drinkers account for less than 10 percent of total sales, but happily acknowledges the important role the group has played in making the brand the 15th most popular rum in the U.S. Last month, Cabana Boy swiped the role of official rum sponsor for the South Beach, FL-based White Party — one of the nation’s largest AIDS fundraising events — from rival Bacardi.
The popularity of a product known as Cabana Boy points out another important trait of the gay community, which doesn’t mind a little humor — as long as you’re laughing with them, not at them.
To wit: GuinnessUDV North America, Chicago, owner of Malibu Rum, this summer rolled out its second-annual Malibu Loves Fruit Tour, a 10-week West Coast campaign targeted to women ages 21 to 29. But this year’s tour also boasted a tongue-in-cheek Fruit Loves Malibu component that had gay males 21 to 36 in mind.
Both tours featured models dressed as Mr. Malibu and assorted fruit flavors travelling in a branded convertible. While Malibu Loves Fruit hosted parties at bars and music venues in cities such as San Diego, Phoenix, and Las Vegas, Fruit Loves Malibu concentrated on San Francisco and Los Angeles. Target Marketing & Promotions, Boston, handled.
“We tried a little bit of work in the alternative market, and the participating clubs were crying out for the tour to return,” says Malibu spokesperson Stuart Kirby.
Joining the Party
When Clear Channel Entertainment’s local office decided it needed to attract more gays to mainstream concerts at Chicago’s Tweeder Center, it tapped Third Coast Marketing, a three-year-old regional agency dedicated to gays, for a campaign that included ticket giveaways at gay-owned coffee shops and businesses.
“Working with Third Coast really gave us credibility in the community,” says Pam Morin, director of marketing for Clear Channel. “We didn’t want to be seen as just going after their money.”
Clear Channel also plastered gay neighborhoods with posters and flyers advertising such diverse concerts as Destiny’s Child and the George Strait Chevy Truck Country Music Festival “The tastes of the gay market vary just as much as any other market,” says Third Coast co-founder Kevin Boyer. “But for acts such as George Strait, there usually aren’t that many points of [promotional] contact.”
More national brands are taking an interest in marketing to gays, says Boyer, adding that Third Coast is in talks with a leading vodka brand and a national electronics manufacturer for a 2002 co-promotion that will use a spy theme and the James Bond catch-phrase, Shaken, Not Stirred (with permission from James Bond property owner MGM).
This whole market seems to be stirring.
True Colors
Chicago-based Bcom3 Group added a rather unique flavor to the menu when it launched a new multicultural marketing network in October: a shop specializing in marketing to gays.
To round out Pangea, an assortment of agencies dedicated to ethnic marketing, Bcom3 acquired a 20-percent stake in Double Platinum, a New York-City based shop founded earlier this year by advertising veterans Stephanie Blackwood and Arthur Korant.
The Pangea stable also features Hispanic shops Bromley Communications, San Antonio, and Lapiz, Chicago; African-American specialist Vigilante, New York City; and New-A, Inc., New York City, an agency group focused on Asian-Americans.
Participating agencies will continue to function as individual entities, but will be available collectively to clients needing a broader package.
Rich Enough
One reason gay consumers have been popular with advertisers is the belief that many reside in affluent, two-salary households which have more disposable income than do most heterosexual couples with children. And some marketers have extended that perception to the entire gay community.
The Institute for Gay and Lesbian Studies, Amherst, MA, says the misconception does more harm than good, and not only because it provides a misleading profile to marketers: Right-wing groups are using this perceived affluence to contend that there is no societal bias against homosexuals, and therefore no need for special protection of gay rights.
The Institute contends that the urban legend was created in large part because early data on gay consumers was derived substantially from the subscription lists of gay publications. (As a rule, magazine subscribers tend to skew wealthier than the average citizen.) More recently, online surveys have been using self-selected samples of affluent gays rather than obtaining random samples, the Institute suggests.
In reality, gay men tend to earn slightly less than heterosexual men, while gay women tend to earn slightly more than heterosexual women, according to Witeck-Combs, Washington, DC.
