Marketers have many compelling reasons to target the gay and lesbian community. According to Jon Pogact, sales manager for Brewster, NY-based list firm Mal Dunn Associates, which includes the Metamorphics Media gay and lesbian list division, the market accounted for more than $485 billion in buying power in 2003. That amounts to $27,000 per person in disposable personal income after taxes. Gays and lesbians also make an average of $6,000 a year more than their straight counterparts.
Many gay households also tend to be DINKS, or dual income, no kids. For that reason, Pogact says, gay lists work particularly well for those that sell upscale home decor, apparel, and travel. Merchants such as Barnes & Nobel, Design Within Reach, Neiman Marcus, and Pottery Barn have all logged successful campaigns.
The gay and lesbian book club InsightOut, from Garden City, NY-based membership mailer Bookspan, is in fact one of the fastest-growing of the company’s 40 segments, says founder/editor-in-chief David Rosen. In four years, the InsightOut book club has grown to more than 50,000 members.
The club consists predominantly of homosexual men — only 20% of InsightOut’s members are lesbian. But that’s starting to change, according to Rosen. “Even as early as last year it was much harder to find lists of [gay] women on the marketplace, but we’ve seen good response this year,” he says.
Rosen attributes the swell of lesbian names to more media attention. TV programs such as the much-hyped L Word and high-profile openly gay performers such as Ellen DeGeneres have made it more fashionable to be “out.”
And that’s important for companies that want to target gays, because most lists of gays and lesbians are “self identified,” says John Knoebel, president of New York-based list firm Triangle Marketing Services. In other words, the people on gay/ lesbian lists have identified themselves as such through a variety of consumer actions, such as subscribing to a gay magazine, donating to a “gay friendly” nonprofit organization, or buying product through a gay catalog. According to Knoebel, there are no gay compiled lists on the market, however.
Gay names still elusive
Indeed, while more gay consumers may be identifying themselves as such, finding gay lists to rent remains a challenge. There are about 15 million identified gays and lesbians in the U.S., but the names of only a third of them are available for rental or exchange. Metamorphics Media and Triangle Marketing each manage about 3 million names on 45 lists. But gay lists are still generally small. Knoebel estimates that only five or six gay lists have more than 100,000 names, with the average file size hovering at about 30,000 names. So to test the gay market, a mailer may have to rent a half-dozen lists to come up with enough names for a solid test.
And while Rosen says he’s seeing an increase in names, not everyone is having the same experience. “Five years ago the gay market was robust,” says Wally Schwarz, president of Palm Springs, CA-based WAS, which mails the 32-page Gay Video Store catalog. Schwarz’s file has about 500,000 names for rental, of which, he says, about 220,000 of those names are identifed as gay. “Ever since 9/11, the entire usage of gay lists has dwindled, with the exception of nonprofits,” Schwarz says. Part of that has been the general lackluster economy; Gay Video Store in particular has also been hurt by the emergence of video on demand.
A lack of available names is precisely why Neil Mulhall, president of women’s plus-size apparel mailer Silhouettes, doesn’t target the gay market more. But it’s not the only reason. “Most of our prospecting is by size, not the lifestyle select,” say Mulhall, whose catalog is part of $415 million Edgewater, NJ-based holding company Hanover Direct.
But other merchants believe that the gay market has serious potential. For Corte Madera, CA-based home decor cataloger/retailer Restoration Hardware, “the gay and lesbian category of lists could be a great source of new customers,” says director of direct marketing Linda Spellman. “We haven’t found any that we’re excited about using yet, but we are definitely open to using them in the future.”
Catalogers that want to reach gay and lesbian consumers now may need to be patient or get creative. In addition to targeted postal and e-mail lists, alternative media opportunities exist, such as gay media placements and gay card packs, as well as catalog and package insert programs from gay and lesbian companies.
Some of the larger gay lists on the marketplace include the LAMBDA Legal Defense Fund, The National Gay & Lesbian Task Force, and The Human Rights Campaign. Publications include Los Angeles-based Out and The Advocate and San Francisco-based Girlfriends and Curve.
Marketers interested in renting names of gays and lesbians could also start with online-sourced names from e-newsletters such as PlanetOut.com and Gay.com. A benefit of many such files is that they require subscribers to enter useful data such as buying history and personal interests on the registration form. For example, Los Angeles-based Hyperion Interactive Media, a network of gay and lesbian Websites, requires site registrants to submit personal information. Data such as household income, education level, and personal interests and buying history on their registration forms makes the names more qualified for marketing purposes, says president Matt Skallerud.
Proceed with caution
In many ways, testing gay and lesbian lists is no different from renting any other list. Always ask for list usage before mailing a file, to determine if any of your competitors have mailed the same names recently and if the file has a good test-to-continuation percentage. Generally test-to-continuation rates are 50%-70% among gay lists, compared with 25%-30% among “mainstream” lists, according to Metamorphics’ Pogact.
Some marketers have gay-specific offers, such as New York-based continuity club marketer Columbia House, which introduced a lesbian-specific DVD/ video club last April. “You can get it wrong and definitely strike some false notes if you use one-size-fits-all marketing,” says Bookspan’s Rosen.
But the vast majority treat the segment as just another list universe, which may be just as well. As Pogact says, “Most gay and lesbian consumers do not wear a rainbow on their forehead and may not be comfortable with their neighbors, employers, or the postman knowing about them being gay.”
A sampling of gay and lesbian lists
10Percent.com Masterfile: Selling a variety of gifts, books, apparel, and other merchandise via catalog and the Internet, 10Percent.com has a total universe of 55,400 names; $100/M; managed by Triangle Marketing Services.
AdamMale: Nearly 25,000 buyers, primarily men 21-44 years old, have purchased videos, apparel, and adult entertainment products from the cataloger; $125/M; managed by Roseberry Direct List Management and Brokerage.
Coda International Tours: Nearly 9,300 travelers spent an average of $4,000 an order on luxury tours from this company specializing in gay and lesbian travel; $125/M; managed by Triangle Marketing Services.
Gay Mart Catalog Buyers: The catalog of apparel, accessories, and gifts for gays and lesbians has nearly 73,500 buyers; $125/M; managed by Mal Dunn Associates.
Leisure Time Gay Video: The nearly 405,000 names on this file spent an average of $60 an order on videos from the cataloger; $105/M; managed by VentureDirect Worldwide.
Made in Gay America: Selling apparel, decor, and gifts to gays and lesbians, this catalog has more than 8,700 buyers and requesters; $90/M; managed by Mal Dunn Associates.
Tzabaco Catalog: Selling apparel, housewares, and gifts tailored for gay consumers, Tzabaco has more than 46,000 buyers on its file; $115/M; managed by Mal Dunn Associates.
Where the gays are
Interested in learning where to reach gays and lesbians? Below are the zip codes with the highest percentage of gay/lesbian residents.