Beyond Pride: how brands can better engage the $5 trillion LGBTQ market

“We’re coming up to Pride season right now and if you talk about literally the bare minimum you can do, it's to 'be there,' support this community and be visible during Pride Month,” said Michelle Tobin, vice president of brand partnerships and advertising at Grindr and Into on the Brand Innovator stage at SXSW. “But honestly, I find the bare minimum pretty frustrating, when brands just slap a rainbow on their bottle or wave a rainbow flag during pride, and then call it a day, [or feel they] checked that box. Because surprise, surprise, people are gay all year round and continue to need to buy laundry detergent, and diapers, and clothing, and cars.”

Indeed, the cumulative aggregated annual spending power of the global LGBTQ community, according to LGBT Capital, is estimated at more than $5 trillion. Into, which in its first month had over 4m unique visitors, has become the number-one LGBTQ site in the world within six months and has tapped into the global pulse of the community.

“As a gay consumer, when I'm not at work I can go to the grocery store, I can go to the pharmacy, and I buy toilet paper, I buy toothpaste, and I look at an advertisement that has someone that doesn't look like me, and I'm still going to buy it,” said Zach Stafford, editor in chief of Into. “But if I see one brand that has someone that looks like me, either interracial or gay, I'm buying it immediately.”

This is an insight shared by a significant portion of the community: half of LGBTQ consumers are more likely to perceive brands as LGBTQ-friendly if they advertise to media outlets that they read. 44% of consumers have a more positive perception of the brand if they cater to them. The findings were crucial to Tobin, Stafford and team, who looked to attract brands in a way that parent company Grindr couldn’t.

“Very often when we go talk to brands,” Tobin said, “we'll talk to the head of marketing, we'll talk to the head of multicultural marketing, we'll talk to agencies, and a lot of times when I ask them who handles LGBTQ initiatives at your company, I get 'I'm not sure, I'll have to check into that,' or, ‘Occasionally, I handle that.' But I think in the research it shows that the vast majority of brands have no one allocated or dedicated to this audience at all.”

True connection is deeper than the rainbow

For marketers, that disconnect is most evident when talking to millennial consumers, for which over 20% of that audience identifies as LGBTQ. “That’s not a tiny audience,” Tobin noted, “and given how advertisers are frantic about reaching millennials, it’s always curious to me how many brands that I speak to that make no effort whatsoever in reaching our communities.” In the study, it was noted that marketing spend for the overall millennial demographic has increased “significantly” by about 16%, whereas the LGBTQ demo has only seen an increase of 3.9%.

The reasons why proper representation in advertising is important is much larger than appeasing those in the community. “For us, when we see ourselves in a movie or in an advertisement,” Stafford said, “It's not that we think ‘Oh, representation is great!’ It's also a safety thing. I belong here.”

“That's why you see the rainbow flag on college campuses or the counselor’s doors,” he continued. “That's not just saying 'Oh, this person is cool, it's saying, 'Hey — if you come into this office and you tell me you're gay, you're going to feel safe, you're going to feel supported, and that's what your brands can also do every day, and that's massive to a lot of people.”

Brands do want to be liked by this community, according to Brand Innovators. In the study Into conducted with them, 70% of brands said that they would like to be perceived as positive and friendly towards the LGBTQ community. Tobin found that important, adding, “70% of our consumers that we surveyed said whether or not a brand is perceived as LGBTQ friendly has directly affected a purchasing decision that they've made or not made if they weren't perceived as friendly.”

Even further, Tobin added: “Nearly 50% have said that they actually made a purchasing decision based on seeing an ad that was inclusive of LGBTQ people,” she continued. “To that point, seeing someone say, ‘Oh! I recognize myself here, I feel safe with this brand, I now feel more positive about this brand.’ We also find that our audience tends to talk about brands, tell their friends about brands that they perceive as LGBTQ-friendly.”

Brands seeing success through consistency

AT&T has found success in creating authentic relationships with the LGBTQ community. Robert Hebert, the LGBTQ marketing lead for the telecom company, said, “LGBTQ market research has made leaps and bounds through the years. I think that we are finally starting to get accurate readouts of the community which is showing up as more diverse than ever in research. There is more available research on this segment than ever before.”

The company had considered itself 'on the right side of history' since 1975, where it passed an anti-discrimination clause protecting those in the community, and Hebert highlighted its work with Cindy Lauper’s True Colors fund. ”Up to 40% of youth experiencing homelessness identify as LGBTQ,” he said. “Awareness of this issue amongst LGBTQs has been low.” The two created a PSA to raise awareness within the community. “Because AT&T has a very authentic history and connection with the community, the response to these campaigns has been extremely positive. Last year’s campaigns had some of the highest levels of engagement that we’ve seen because we are engaging the community to support the people and programs making a difference in the world.”

Wells Fargo has also become an example in the space; in 2015, the brand created a well-received spot featuring a lesbian couple learning sign language, later revealing the pair were adopting a deaf girl. “If a company is serious about reaching LGBTQ consumers,” said John Lake, vice president of multicultural marketing for Wells Fargo, “Pride is table stakes.”

“Brands need to be there,” he continued, “but as a starting point. For years, our imagery was of same-sex couples – and that was a big statement in the early days. But that focus leaves out huge swaths of the community. Last year, one of our hero images featured three individuals on the spectrum of orientation and identity. It was intentionally vague and I loved the fact that through this image we were able to go beyond labels and reflect the community more inclusively.” Even though that “Sign Language” spot itself, which aired as part of its general market brand campaign, received some blowback from some groups that took offense, Lake said, “we stood behind it completely and never wavered.”

The team at Into also cited brands such as Target, H&M, Calvin Klein (already owned by an “unapologetically gay man,” said Stafford), and Absolut Vodka as champions of the community that have been considered LGBTQ-friendly by consumers.

Simply making a commitment to this community means a lot, believed Tobin. as it's not a niche audience. “It's not an audience that it makes sense to ignore,” she adds. “especially given the generations getting queerer and queerer based on the research.” She implored brands to commit to engaging with the audience year-round and to act on it. “That's marketing right there,” she said. “There's someone dedicated in your organization to actually learn about this audience and focusing on campaign initiatives on this audience. It doesn't happen by accident.”

Stafford added that brands need to know that the audience is already there, and even acknowledging their existence is important. “It may take finally waking up and giving them a wink or something,” he said. “They're already buying, 10% of your consumers are gay, they're already there, and you show them in the ad now, you may have even more.”

On a deeper, intersectional level, Stafford, a black gay man, added that the members of this community are “global, they're racial, and they're very interested in talking about their opinion. They use that as a doorway to get to other communities. My parents are straight, so they're looking for people who support people like me, who are black, who are gay.”

Additional reporting by Doug Zanger

Read all of The Drum's coverage from SXSW in Austin, including The Drum's unique sessions with Karmarama.