New research results from the US reveal that in 2005, more than USD$212 million was spent by corporate America advertising to gay consumers, a figure that dwarfs British expenditure.
One of the world’s foremost authorities on marketing to gay consumers, Ian Johnson, says “British business, even on a relative population basis, is spending at less than a quarter of that rate, and is currently missing out on significant profits as a result.”
“While corporate Britain is still just dipping its toes in the water, US and Australian brands have already got their gear off, jumped right in and have come out safely on the other side – complete with their share of the market and increased profits,” says Johnson.
Johnson is Managing Director of Out Now Consulting – a company relied upon by many of the world’s largest brands including Barclays, Hilton Hotels, Lufthansa, IBM and Citibank to help them understand gay consumer behaviour.
“With very few exceptions UK brands are missing out on significant profits due to being poorly served by their existing marketing agencies, as they fail to keep pace with this global market trend,” added Johnson.
New laws also mean that from October 2006 UK companies must ensure they do not discriminate against people on the basis of sexual orientation in the provision of goods and services, as well as in their advertising.
According to Whitehall, gays and lesbians make up around six percent of the total UK population and Johnson says brands must utilise better targeted gay marketing to reap increased profit opportunities in a gay market now valued annually at more than Â£70 billion earnings.
A groundbreaking UK conference will address these issues next month. Johnson presents the keynote address at The Pink Pound Conference on 22 June in Millbank, London.
This new conference event has been developed by this years national CEA Award winners, Ingenious Group, as a means to help British marketers across all sectors learn how to better position their brands in the GLBT marketplace.
Conference producer Jean Collingwood of Ingenious Group believes the need for British business to understand gay marketing is now more imperative than ever. “New regulations are planned to come into force in just a few months under the Equality Act which outlaw discrimination in the provision of goods and services to lesbian, gay and bisexual people, as well as in advertising and this will affect every single sector of the marketing community,” says Collingwood.
“Companies here are already investing in improving customer insight and they understand how a holistic approach to diversity can impact on their bottom line,” says Collingwood. “The big issue now though is not whether brands should include gay consumers in their marketing efforts but how far they will need to go – for both marketing and legal reasons.”
“Despite the UK enjoying a well-deserved reputation as being one of the most socially tolerant nations in the world, Britain’s businesses have been amongst the slowest in the world to recognise that the gay market, with fewer children in gay households and higher resulting disposable incomes, is one of the dream markets of the new millennium,” according to Johnson. “We think that is because British business is still in the dark about how to go about unlocking the large profit potential on offer. Gay consumers’ attitudes remain a mystery to most UK brands.”
Australian research findings show the large brand loyalty potentially on offer to UK brands – with three out of four Australian gay consumers favouring brands that they see targeting them effectively.
The Pink Pound Conference is creating unprecedented levels of interest and debate across every sector of the marketing community. Some of the UK’s biggest brands from automotive, household products, lifestyle, the alcohol industry through to hotels, music, consumer electronics and leisure are attending to learn more about how they can market effectively to UK gay consumers.
“One thing everyone agrees is that stereotypes, insults and badly executed marketing has had its day and needs to improve in the UK. British business clearly must learn how to understand this group of UK customers effectively,” says Collingwood.