Tuesday, June 20, 2017

The Trillion Dollar LGBT Market Niche

A portion of the crowd at PrideFest 2017
When I was fired from a large local law firm after I came out in mid-life - a gay partner it was said would offend the sensibilities of the firm's "conservative" client - I made a concerted effort to market to the sizable LGBT market.  Who better to address the legal concerns of LGBT citizens than a gay attorney who knew about bigotry and discrimination first hand (hence my win as the best attorney in Outwire 757 recent reader's choice awards).  As part of that effort, I was a founder of the local LGBT chamber of commerce, Hampton Roads Business OutReach ("HRBOR") In the years since, both locally and nationally, more and more businesses have discovered that smart business means marketing to the LGBT community and other minority communities, e.g. the Hispanic-American community. Some businesses have suffered the attempted wrath of Christofascists who regularly have called ineffective boycotts against national companies advertising to the LGBT market, but have been undeterred (and typically saw they earnings increase).  A piece in Inside Business underscores why marketing to the LGBT community makes sense.  The explanation is ultimately simple:  LGBT individuals make up a trillion dollar market and have money to spend.  Moreover, they are loyal to those who are LGBT friendly - locally, I can tell you which law firms to avoid if you are LGBT - and engage in word of mouth promotion of merchants and professionals that they respect.  Here are some article excerpts:
Rainbow flags [could] be seen on the streets of Hampton Roads as the region prepare[d] for a series of celebrations for the LGBTQ community, wrapping up a month of gay pride celebrations.
Hampton Roads PrideFest alone expect[ed] 25,000 to 30,000 visitors from across the Mid-Atlantic for Saturday's festival in Norfolk's Town Point Park. Many of these visitors have booked hotels for the weekend and restaurants, stores and other tourism-related businesses expect big business.
The estimated purchasing power of LGBTQ adults in the U.S. ranges around $1 trillion. Witeck Communications released a study last year that showed a four percent increase to $917 billion while the National Gay and Lesbian Chamber of Commerce estimates buying power at $1.7 trillion.
The Hampton Roads region is no exception. In fact, a 2015 Gallup study ranked the Virginia Beach-Norfolk metropolitan area as 12th out of 50 metropolitan areas with the highest proportion of LGBTQ adults (4.4 percent of our population). Old Dominion University's 2016 State of the Region Report estimated the LGBTQ working-age adult's average income in Hampton Roads totaled $2.017 billion, about 4.8 percent of total income of adults between the ages of 25 and 64.
This large purchasing power isn’t because LGBTQ adults are earning more than their heterosexual counterparts. In fact, studies cited in the State of the Region show gay men and lesbian women earn about five and nine percent less, respectively, than their heterosexual male coworkers.   Rather, this purchasing power comes from large disposable incomes due to the fact LGBTQ households often have two full incomes without any children and related expenses . . .
Much of this disposable income goes toward travel, hence the interest of the tourism industries. Virginia Tourism Corporation data shows LGBTQ visitors stay longer and spend more than their non-LGBTQ counterparts.
The Downtown Norfolk Council emailed local businesses with a list of suggestions on how to make the most of the gay pride festival and potential customers. Suggestions included showing off rainbow clothes, flags, signs, drinks and food along with offering discounts to people who wear rainbow colors in support. The council even offered to distribute rainbow flags and necklaces for free.
Ryan Downey of the Hampton Convention and Visitor Bureau said although there is nothing in Hampton that is exclusively for the LGBTQ consumer, the bureau hosts occasional meeting of local business owners to discuss LGBTQ events and efforts.
Pride events have included a river cruise, in which all proceeds went to ACCESS AIDS, and a historical feature on growing up gay in Hampton Roads called “Our Story, Our Time” presented by the Hampton History Museum.
The Virginia Beach Convention and Visitor's Bureau has produced an in-flight video for American Airlines featuring LGBTQ locals along with photos of LGBTQ couples, to market weddings at the convention center and the city's ViBe district.
The ViBe district boasts the Rainbow Crosswalk at 19th Street and Cypress Avenue. Virginia Beach leadership, all the way up to the mayor, has embraced this intentional, organic symbol by a local artist . . . .
Several organizations aim to help businesses overcome the marketing costs of advertising themselves as a destination for LGBTQ consumers.
The Hampton Roads Business OutReach aims to give local businesses national exposure. Tracy Skinner, the outreach group's president, encourages businesses to become certified as an LGBTQ business enterprise through the National Gay and Lesbian Chamber of Commerce in order to do business with larger corporations like Hilton and American Airlines.
Similarly, the Virginia Tourism Corporation urges business to add a free listing at Virginia.Org, which reaches 13 million annually. It also offers an extensive LGBTQ tourism resource guide. 
LGBTQ acceptance has been on the rise in the last decade since the repeal of the Defense of Marriage Act and “Don’t Ask, Don’t Tell." Although many are encouraged by the growing acceptance, tourism industries of competing cities have struggled to “break through the noise.” . . . "It’s not enough to just slap a rainbow flag on something and check the box.”
As the article notes, locally, the LGBT community is over a $2 billion market.  What savvy business owner would not want to pursue that type of market?

Winners of the 2017 Outwire757 "Best of" Awards

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