Preference

This page looks at what's sometimes bundled as the 'pink' demographic - gay, lesbian, bisexual and transgender (GLBT) people online.

The wired GLBT population is of interest because it's been characterised (somewhat dismissively) as the "marketer's dream audience". It also demonstrates the need for caution in considering problematical claims about figures and behaviour.

     introduction

It has become fashionable to write about a discrete 'GLBT demographic' - one that's presumed to be homogenous, rich and passive.

Forrester shrilled that it was uniquely "different" and "a lucrative niche market", noting estimates that US gay and lesbian consumers account for US$340 billion in annual spending power. Advertising Age disagreed, claiming that the spend was around US$514 billion. Modalis Research Technologies said the GLBT spend is valued at "over $450 billion".

There have been similar claims in offline studies such as Steven Kates' Twenty Million New Customers: Understanding Gay Men’s Consumer Behavior (Binghampton: Haworth 98) and Grant Lukenbill's Untold Millions: Secret Truths About Marketing to Gay & Lesbian Consumers (New York: HarperCollins 95).

A 2001 study by US market researchers Witeck-Combs & Harris Interactive contradicts an influential 1998 Greenfield report and claims increasing ecommerce activity by members of the GLBT demographics. "We have long observed gay affinity for the Web, and the numbers keep soaring". Witeck's 2000 report "confirmed that gays and lesbians are 'information-hungry' and disproportionately favor use of the internet and online communication".

We'd be more impressed by that study if there weren't concerns about the size of the sample (137 people of 2,525 adults) and apparent assumptions about a uniform and passive demographic, explored in Alexandra Chasin's preachy but intelligent Selling Out: The Gay & Lesbian Market Goes To Market (New York: St Martins 00).

In practice the premises of such studies are problematical. The May 2000 issue of Demography, the journal of the Population Association of America, cautioned that "demographically, this is a hard population to target and analyze. Data on sexual orientation is not as easily available as information on race, gender and age."

     population size

How big is the online GLBT market in Australasia and overseas? The answer is that no-one knows, although that hasn't inhibited pitches to investors and potential advertisers.

US researchers Computer Economics claimed in 2000 that "between 2001 and 2005, the number of gay and lesbian internet users will grow from 13.5 million to 22.4 million" - arguably a significant underestimate - with projections of growth of 120% in the Middle East.

The latter is from a very low threshold: while the online GLBT population in South America was forecast to increase from 106,000 in 2000 r to 347,000 in 2005 that in Africa was predicted to climb to 59,250 and in the Middle East it would soar from 9,200 to 11,200 in 2005.

The US-based PlanetOut and GayCom sites have each claimed 1 million members, with a collective market reach of over 3.8m individuals.

Viacom's claimed that around 6.5% of the 105 million households in the US have "at least one gay clicker" (which given US household structure is probably an underestimate). It argues that "22% of partnered lesbians and 5% of partnered gays" have children at home, around 70% percent of whom are under the age of 17 and many from previous relationships. That's consistent with the claim that 20% of US men in gay partnerships and 30% of women in lesbian partnerships have previously been married or are currently married. Go to other studies and you'll find contradictory claims that

The majority of gay and lesbian households are comprised of what the Census Bureau coined "DINKS" - Dual Income, No Kids. Only eight percent of same-sex partners have children in the household, while 35% of opposite-sex partners do.

Simmons' research comparing US gay consumers to the national index of consumers reported that its group was 71% male/29% female, twice as likely as the national index to be professionals/managers and have a household income over US$60K (indeed twice as likely to have household income over US$250K), twice as likely to have a degree, three times more likely to be online than the average consumer, four times as likely to spend over US$150 on long distance and twice as likely to spend US$250 on mobile phone services.

     income and spending power

Assumptions that GLBT people are wealthy (and have a higher disposable income because they've disposed of kids) have rightly been questioned.

Amy Gluckman & Betsy Reed's "The Gay Marketing Moment", in Homo Economics (New York: Routledge 97), queried the self-interested nature of claims by some GLBT marketers. Lee Badgett, University of Massachusetts professor in economics, exploded the "myth" of gay affluence in a 1998 study suggesting that gay men earn less money on an individual basis than their hetero counterparts.

In Money, Myths, and Change: The Economic Lives of Lesbians and Gay Men (Chicago: Uni of Chicago Press 01) and earlier 32 page Income Inflation: The Myth of Affluence among Gay, Lesbian, and Bisexual Americans paper (PDF) she noted that much market research is based on a small self-selected subgroup of GLBT consumers skewed towards people with high incomes and high levels of education.

As a result of using this biased sample of people who are online and use gay Web sites, the companies conducting the study have found what they were looking for — gay people with unusually high incomes and spending. But a number of credible scientific studies that used data from random samples of gay, lesbian, bisexual, and heterosexual people find the opposite result. Gay people and gay couples do not have higher average incomes than heterosexual people.

     and behaviour

Affluent or otherwise, it is unclear whether membership of a GLBT demographic makes an appreciable difference to much online behaviour.

The problematical Witeck survey in 2001 claimed to uncover

a sharp jump with 32% of LGBT Internet users now stating they use the Internet for more than 21 hours per week (apart from email), compared with a minor decline to 17% among non-gay users. In April 2000, one-quarter (25%) of LGBT respondents disclosed using the Internet more than 21 hours per week (excluding email) compared with 18% of non-gay Internet users.

It went on to comment that

over one-quarter (28%) of LGBT respondents conducted their banking transactions online in the last three months, as compared with 21% of non-gay web users. Similarly, a 7% gap exists between LGBT and non-gay respondents who took part in online auctions over the past three months (26% v 19%, respectively).

LGBT respondents are also slightly more likely to make online purchases for goods and services than their non-gay counterparts (63% vs 59%).

The newest findings validate the power of the Internet to promote gay consumer spending and to transform the potential for e-commerce. The LGBT market appears to signal a bellwether, enabling gay households to find welcome, safety, convenience and service online.

Greenfield's study claimed that

• 78 percent of US gay online users prefer to buy from companies that advertise to the gay market
• 71 percent of US gay online users have made credit card purchases online
• 43 percent of US gay online users identify Gay.com as their favorite site

Given survey composition and the ambiguity of terms, they would say that, wouldn't they. Broader-based studies suggest that the 'favourite' site is likely to be AOL home page.

The October 2001 opuscommgroup.com report claimed that the median combined household income of US gay couples was US$65,000 (around 60% higher than the median income of US$40,800). 79.8% voted in the 2000 presidential election (compared to 49% of the general public voting in the 1996 election) and 68.8% are registered Democrats.

In Australia the Sydney Star Observer claims that the average income of its readers is $48,482 per annum. 58% supposedly have a tertiary qualification, 26% own/manage a business and a further 37.3% work in professions. As of 1998 48.8% owned a computer and 35.8% were online. (In line with the overall population that figure would now be significantly higher.) 25.6% had purchased goods or services online during the preceding month, with an average spend of $575. 36.7% have used the net for online banking; 16.5% do so "occasionally" and 20.2% do so "regularly".

A 2001 Forrester report claimed that the online GLBT population in the EU was more likely to book travel online (and spend up big) than non-GLBT counterparts. 41% had booked travel on the net (reference 28% of the overall population). Forrester claimed, in line with comments noted above, that

around 3.5% of online travel bookers are gay or lesbian and this group will research almost US$2.9 billion in travel products on the Internet in 2001. Members of this group are, on average, three years younger than their straight counterparts. They also earn more, are better educated, and are more willing to pay for premium services. Gay and lesbian consumers also enjoy shopping online and using new consumer technologies.

   next page (Australia)