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Chasing the ‘pink dollar’

Thursday, 22 November 2012 | By Matty Soccio

feature-rainbow-barcode-thumbThe past 10 years has seen a chorus of companies, big and small, attempting to tap the ‘pink dollar’.

 

Brands like Volkswagen, Absolut and Levis have all invested heavily in attracting consumers from the LGBTIQ (lesbian, gay, bisexual, transgender, intersex and questioning) community, constructing advertising campaigns with rainbow colours, flamboyant music and costumes.

 

Start-ups are now looking to cash in, too. August saw the launch of QueerDeals, which claims to be Australia’s first daily deals site for the gay community.

 

This followed the creation of Pink Media Group, a Sydney-based business that aims to connect brands with the “pink dollar” via advertising.

 

Pink Media Group founder and managing director Ben Mulcahy says the gay market consists of 2.2 million people, with an annual disposable income of $20 billion. These are numbers that no small business owner will sniff at.

 

But what is the right way to do it? Does targeting your marketing to focus on sexual orientation mean you’re being mindful of the community’s interests or adding to the ‘pinkwashing’ clutter?

 

Token marketing sends an empty message

 

Take Fabiano Nigro for example. He’s a mid-20s sales professional with a disposable income: a prime target for marketing departments everywhere. Does it matter if he’s gay?

 

Is your marketing message meant to change to appeal to his sexuality or to his age?

 

Fabiano believe that a brand’s reluctance to market to the LGBTI community is a sign that there’s still fear in acknowledging it.

 

“I think companies fail to take it further than marketing – it needs to go from the little rainbow flag to customer service, and made inherent in policies and procedures and organisational culture; ending discrimination,” he says.

 

“I do agree that there is still ‘pinkwashing’ occurring, but in a country whose left wing leader can't even come out and support same sex marriage, how can there not be?”

 

Fabiano points to his local yoga studio, Bikram Yoga, in the Melbourne suburb of Fitzroy, as a prime example of providing customer service alongside marketing to local residents, including the LGBTI community.

 

It’s not over the top and acknowledges the interests in the community.

 

He says: “Companies that advertise on JoyFM, such as MyMac, live up to [my] expectations. I think it comes down to the culture within the organisation, not just the marketing.”

 

“I think most companies are still afraid to start marketing campaigns that show support to the LGBTI community.”

 

A growing and diverse market

 

The LGBTI community is a demographic that governments and social researchers believe has huge growth potential.

 

Take tourism – a 2009 Roy Morgan report estimated the LGBTI travel market alone is estimated to be worth $965 million per year.

 

Michael Snell, co-founder and owner at Gay Travel and Best Gay Cities.com Online Publishing, is hardly surprised – this estimation is typical of LGBTI travel markets throughout the western world.

 

The problem, explains Snell, is that too many ‘straight’ companies use gauche techniques in a bid to attract the ‘pink dollar’.

 

“[The term] ‘Gay friendly’ is way overused. Just because a straight-owned business wants to take the pink dollar, does not make them gay friendly,” he says.

 

“But walk down the streets in some big cities and you will see rainbow flags on straight businesses.”

 

“What does that mean really? What have they done for the gay community to demonstrate they are truly gay friendly? To me the term ‘gay friendly’ must be earned. [It] must be awarded.”

 

While it is easy to chastise brands for superficial attempts at courting the LGBTI community, Snell gives credit to the difficulty ‘straight’ companies have in identifying how to best tailor their marketing message to the community.

 

For Snell, being a part of the community makes it easier to understand its needs.

 

He says: “Because I am gay, I am very in touch with the gay community and see lots of marketing fails, [but] also successes.”

 

“It's easier for me to market my services to ‘my people’ because I am more in touch with them – and many gay people like to support other LGBTI business owners.”

 

In the entrepreneurial world, a lot can be learned from the current crop of ‘queerpreneurs’ who know their audience better than those outside the LGBTI community.

 

This inside knowledge may give them a perceivable upper hand, but it doesn’t mean that your business has to be out of the loop. But if you’re going to do it, you need to do your research and consult your audience.

Take the Pink Dollar app released in August 2012 – an iPhone app that connects retailers and service providers who are supportive of LGBTI consumers, featuring a list of gay-friendly retailers searchable by category and location.

 

That it was produced in Hong Kong says much about its necessity in a country that traditionally doesn’t readily accept the LGBTI community. But is it needed in Australia?

 

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Beyond the ‘pinkwash’ – companies that do it right

 

In the same way that companies splash their ‘green cred’ to cover their polluting activities, ‘pinkwashing’ is a way to appear to be gay friendly but not follow through.

 

However, many companies do get it right.

 

Absolut has been lauded for its support of the LGBTI community for the past 30 years, not only through its gay-friendly advertising but through sponsorship of gay pride events and general appreciation of all its consumers, regardless of their sexual orientation.

 

And there lies the perennial question: is marketing to consumers based on their sexual orientation even necessary?

 

Adam Ferrier is well known throughout Australia for his insight into consumer psychology (which he regularly shares as part of the panel on ABC-TV’s The Gruen Transfer).

 

Ferrier believes that, because there is a profitable opportunity to target the LGBTI community, businesses need to be cautious about how they go about it.

 

He says: “There is a significant proportion of the population that is gay – and of course the numbers would suggest that they are a ‘market’ worth going after.

 

The question remains, however, if they wanted to be targeted to exclusively or not.”

 

Ferrier believes that it’s extremely important to be mindful of your consumer, even through to the terminology you use.

 

“If I was gay I'd want to be marketed to as a person, not because of my sexuality. Anything that dials up individual difference too much risks being patronising and alienating – whether it be using mums to advertise washing up liquid, old people to spruik retirement homes, or gays to talk about condoms.”

“Rising above the differences and talking to humanity is always better.”

 

“In the ‘90s the term ‘pink dollar’ was invented – I find it offensive. Market to the person not their sexuality.”

 

When it comes to forming a strategy to target the LGBTI community, you need to think outside the box – to avoid a ‘pinkwashing’ label, you need to consider not only what your product or service can provide to the community, but how your whole company can be gay friendly.

 

And that means no rainbow flags on your front window, or, as Snell explains, don’t be disingenuous.

 

“You can't just call yourself ‘gay friendly’ and hang a rainbow flag up. You have to prove it. Get involved. Show that you have a sincere interest in the gay community,” asserts Snell.

 

Top Tips

  • The LGBTI community are regular consumers: think carefully about your messaging.
  • Avoid ‘pinkwashing’: Don’t paint your products or services with rainbow flags. Support the LGBTI community through sponsorship promotions.
  • Don’t make a big deal out of it: You don’t need to advertise that you’re gay friendly; publicity will come from community support.
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