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The Gay and Lesbian Market


Attention: There is an updated edition available for this report.

This completely updated report offers a comprehensive analysis of the gay and lesbian consumer market in the United States. The report begins with an overview of key demographic characteristics of the gay and lesbian population, including income levels and household structure. The report then assesses the current size and projected growth of the market through 2004 and highlights key aspects of the shopping habits and consumption patterns of gay and lesbian consumers. The report provides examples of how mainstream companies in the financial services, automotive, travel and other key industries are developing and carrying out effective advertising strategies to target this market.


Scope and Methodology

Scope of Report

This Packaged Facts report analyzes the market represented by self-identified gay men and lesbians 18 years of age and over. Research studies often use sexual behavior as the basic criterion to estimate the size of the gay and lesbian population. However, self-identification is a more relevant criterion for estimating the number of gay and lesbian consumers in the United States, because self-identified gay men and lesbians are most likely to respond to marketing programs geared toward the gay and lesbian market.

Methodology

This analysis is based on information collected through interviews with marketing and advertising executives, media representatives, and experts in gay and lesbian demographics, as well as an extensive review of published materials. The research included a comprehensive survey of relevant studies published by the scientific community. Other sources included trade journals covering the advertising and marketing fields, Web sites oriented toward gay and lesbian consumers, gay print media, and mainstream news reports and commentary on political, social, and economic trends within the gay and lesbian community.

Issues Addressed:

  • Population Increase
  • Racial Dispersion
  • Household Structure
  • Economic Status
  • Political/Religious Affiliations
  • Urban vs. Rural Locale
  • Same-sex Couples with Children
  • Consumer Behavior
  • Internet Shopping Patterns
  • Defining Homosexuality
  • Alcoholic Drinking Habits
  • Recreational Interests
  • Food and Nutrition Concerns
  • Gays in the Media
  • Product Adaptation

Targeted Ad Campaigns:

  • G&L Internet Bank
  • American Express Financial Services
  • SAFECO
  • Gay Financial Network
  • Visa Rainbow Card
  • Meyer’s Pride Value Fund
  • Mitchell Gold
  • living.com
  • furniture.com
  • Bacardi-Martini USA
  • Hiram Walker
  • Merck
  • Glaxo Wellcome
  • Roxane Laboratories
  • BTG Pharmaceuticals
  • DuPont
  • Roche Pharmaceutical
  • Agouron Pharmaceutical

Hours of Research: 600

Executive Summary

    Introduction
  • Background
  • Overview Of Report
    Scope And Methodology
  • Scope Of Report
  • Methodology
    Demographics
  • Gay And Lesbian Population Studies Have Limitations
  • Self-Identification By Gays And Lesbians Is Increasing
  • Gay And Lesbian Population Estimates Require Complex Set Of Assumptions
  • Table 1-1: Projected Growth Of Total U.S. And Gay And Lesbian Population 18 Years Old And Over, 1999-2004
  • Gay And Lesbian Population Is Disproportionately Non-Hispanic White
  • Many Gay And Lesbian Households Are Domestic Partnerships
  • Substantial Number Of Gay And Lesbian Households Include Children Under The Age Of 18
  • Distribution Of Earnings Of Gay And Lesbian Population Same As Population As A Whole
  • Table 1-2: Distribution Of Earnings Of Full-Time Workers: Gay People (1992-1996) Vs. All People (1998)
  • Corporate Diversity Programs Expand Employment Opportunities
  • Gay Political Influence Grows
    The Market
  • Gay And Lesbian Market Will Exceed $500 Billion In 2004
  • Gays More Urban Than Population As A Whole
  • Gay And Lesbian Market Is Highly Segmented
  • Gay Families With Children Represent Growing Market
  • Many Factors Affect Market Growth
    Gay Men And Lesbians As Consumers
  • Gay And Lesbian Consumers Loyal To Gay-Friendly Brands And Gay Media Advertisers
  • Gay And Lesbian Consumer Decisions Affected By Value Structure
  • Gay And Lesbian Consumers Have Distinct Expenditure Patterns
  • Gays Spend More On Travel Than Mainstream Consumers
  • Gays More Likely To Be Online
  • Shopping Online Increases
    Gay And Lesbian Media
  • Circulation Of Some National Magazines Remains Flat As Local Publications Gain
  • Gay Print Readers Tend To Be Male
  • New Magazines Target Variety Of Niches In Gay And Lesbian Community
  • Consolidation And Convergence Change The Landscape Of Gay Print Media
  • Internet Opens New Horizons For Gay And Lesbian Radio
  • Gay Television Outlets Remain Limited As Mainstream Broadcasters Begin To Acknowledge Gay Audience
  • Web Portals Improve Access To Gay And Lesbian Market
    Marketing To Gay Men And Lesbians
  • Gay-Friendly Corporate Policies Critical Element Of Successful Marketing Strategy
  • Comprehensive Marketing And Promotion Programs Include Community Involvement
  • Three Schools Of Thought On Most Effective Advertising Styles More Products And Services Designed For Gay And Lesbian Consumers Internet Opens New Vistas For Marketing To Gays
  • First-Time Advertisers Choose Online Presence
    Examples Of Advertising Targeted To Gay Men And Lesbians
  • Awareness Of Gay And Lesbian Issues
  • Gay Pride Symbols
  • Relationships
  • Scenes From Everyday Life
  • Breaking New Ground
  • Living With Hiv

II. Demographics

    Definition Of The Gay And Lesbian Market
  • Basic Terms Defined
  • Researchers See Sexual Orientation As Continuum
  • Male Homosexuality Has Multiple Categories
  • No Standard Definition Of "Lesbian"
    Population Size And Growth
  • Gay And Lesbian Population Studies Have Limitations
  • Behavior Is Not The Sole Criterion
  • Self-Identification Is The Most Appropriate Criterion For Estimating Gay And Lesbian Population Size
  • Earlier Population Studies Showed Lower Rates Of Self-Identification
  • Table 2-1: Overview Of Studies Of Prevalence Of Homosexuality, 1970-1994
  • Later Studies Suggest Higher Percentages Of Self-Identified Gay Men And Lesbians
  • Self-Identification By Gay Men And Lesbians Is Increasing
  • Gay And Lesbian Population Estimates Require Complex Set Of Assumptions
  • Self-Identification Rates Differ For Men And Women
  • Gay And Lesbian Population Over 18 Years Of Age Estimated At 13 Million
  • Gay And Lesbian Population Expected To Increase 13.3% By 2004
  • Table 2-2: Projected Growth Of Total U.S. And Gay And Lesbian Population 18 Years Old And Over, 1999-2004
    Ethnicity
  • Gay Community Reflects Ethnic And Racial Diversity Of American Society
  • Gay And Lesbian Population Affected By Broad Demographic Trends
  • Gay And Lesbian Population Will Become Increasingly Diverse
  • Table 2-3: Projected Ethnic Mix Of U.S. Gay And Lesbian Population 18 Years Old And Over Assuming Uniform Self-Identification Rates
  • Figure 2-1: Population Growth Rates By Race And Hispanic Origin, 2000-2020
  • Greater Stigma Within Minority Communities Inhibits Self-Identification
  • New Federal Government Data Show That Ethnicity And Race Affect Self-Identification
  • Self-Identified Gay And Lesbian Population Is Disproportionately Non-Hispanic White
  • Table 2-4: Adjusted Estimates Of Ethnic Mix Of U.S. Gay And Lesbian Population 18 Years Old And Over
    Household Structure
  • Many Gay Men And Lesbians Live In Domestic Partnerships
  • An Estimated 2.9 Million Gay And Lesbian Households Are Domestic Partnerships
  • Table 2-5: Gay And Lesbian Households By Type Of Household
  • Gay And Lesbian Households Will Total More Than 11 Million In 2004
  • Table 2-6: Projected Growth In Number Of Gay Male Households: Single Vs. Domestic Partner, 1999-2004
  • Table 2-7: Projected Growth In Number Of Lesbian Households: Single Vs. Domestic Partner, 1999-2004
  • Table 2-8: Projected Growth In Number Of Gay And Lesbian Households: Single Vs. Domestic Partner, 1999-2004
  • Vermont Extends Legal Rights To Gay Couples
  • More Employers Offer Benefits To Same-Sex Domestic Partners
  • Census 2000 Expected To Yield More Reliable Data On Gay Households
  • Many Gay Men And Lesbians Are Parents
  • Gay Families With Children Become More Prominent
  • Legal Status Of Gay And Lesbian Parents Varies In Different States
  • Lesbians Are As Likely As Heterosexual Women To Have Children At Home
  • Lesbian Couples Create Baby Boomlet
  • Substantial Number Of Gay And Lesbian Households Include Children Under The Age Of 18
  • Table 2-9: Gay And Lesbian Households With Children
  • Number Of Full-Time Gay Fathers May Decline
    Economic Status
  • Marketing Surveys Show High Incomes For Gay People
  • Level Of Gay Affluence Debated
  • Appropriate Perspective Required To Evaluate
  • Income Data Income Studies Analyzed
  • Discrimination And Age May Affect Earnings
  • Distribution Of Earnings Of Gay And Lesbian Population Approximately The Same As Population As A Whole
  • Table 2-10: Distribution Of Earnings Of Full-Time Workers: Gay People (1992-1996) Vs. All People (1998)
  • High Percentage Of Gays Are Self-Employed
  • Corporate Diversity Programs Expand Employment Opportunities
  • Wealthy Gay Men And Lesbians Expand Philanthropic Horizons
    Politics And Religion
  • Gay Political Influence Grows
  • Most Gays Affiliate With Democratic Party
  • Religious Affiliations Reflect Mainstream Society
  • Role Of Gay People Within Mainstream Religious Organizations Continues To Provoke Controversy
  • Welcoming Congregation Movement Helps At Local Level
  • American Reform Judaism Affirms Same-Sex Unions
  • Gay And Lesbian Churches Formed
    Other Demographic Factors
  • Population Skewed Toward Younger Age Groups
  • Table 2-11: Population By Age Group: Gay Men Vs. Male Population As A Whole, 2000
  • Average Age Of Gay And Lesbian Population Will Increase
  • Gay Population Has Above-Average Educational Status
  • Studies Show Gays Poorly Served By Health System
  • Hiv Infections Stabilize But Young Gay Males Remain At Risk

III. The Market

    Market Size
  • Several Assumptions Form Basis For Estimates Of Market Size
  • Aggregate Income Of Gays Exceeds $400 Billion
  • Table 3-1: Estimated Aggregate Income Of Gay Men, 1999
  • Table 3-2: Estimated Aggregate Income Of Lesbians, 1999
  • Table 3-3: Estimated Aggregate Income Of Gay Men And Lesbians, 1999
  • Purchasing Power Of Gays Totals $340 Billion
  • More Than 2 Million Gays Earn More Than $50,000
    Geographic Segmentation
  • Most Gays Live In Large Metropolitan Areas
  • Smaller Cities Also Attract Gay Residents
  • Central-City Populations Have Highest Percentage Of Self-Identified Gay Men And Lesbians
  • Table 3-4: Gay And Lesbian Population As Percentage Of Total Population By Location Of Residence, 1999
  • Averages Mask Significant Variations Across Individual Cities
  • Gays More Urban Than Population As A Whole
  • Table 3-5: Population By Location Of Residence: Gay Men And Lesbians Vs. Total Population, 1999
  • Lesbians More Likely To Live In The Suburbs While Gay Men Favor Central Cities
  • Table 3-6: Population By Location Of Residence: Gay Men Vs. Lesbians, 1999
    Key Consumer Segments
  • Gay And Lesbian Market Becoming More Segmented
  • Generational Segments Are Key Element Of Gay And Lesbian Market
  • Newest Gay And Lesbian Generation Sets Different Tone
  • Gays Important Element In Trendsetting Urban Markets
  • Self-Employed Gays Are Key Segment
  • IBM Sees Opportunities In Gay Small-Business Owners
  • Lesbians Represent Underserved Market
  • Gay Families With Children Represent Growing Market
  • Table 3-7: Projected Growth In Number Of Gay And Lesbian Households With Children, 1999-2004
  • Older Gays Become A Market Force
    Factors Affecting Market Growth
  • Self-Identified Gays Likely To Form Greater Proportion Of Population
  • More Heterosexual Individuals Interact With Openly Gay Family Members And Co-Workers
  • Declining Prejudice Makes Backlash Against Advertisers Less Likely
  • Gay Characters And Themes On Broadcast Television Raise Comfort Level Of Mainstream America
  • Boycotts Prove Unsuccessful
  • But Experts Still See Hesitation
  • Marketability Remains Key Issue
    Projected Market Growth
  • Gay And Lesbian Market Will Grow 26.4% By 2004
  • Table 3-8: Projected Growth Of Aggregate Income And Purchasing Power Of Gay Men And Lesbians, 1999-2004

IV. Gay Men and Lesbians As Consumers

    Shopping Patterns And Buying Decisions
  • Gay And Lesbian Consumers Expect Companies To Address Them On Their Own Terms
  • Gay And Lesbian Consumers Loyal To Gay-Friendly Brands
  • Gay And Lesbian Consumers Favor Companies Advertising In Gay Media
  • American Airlines Benefits From Gay Consumer Loyalty
  • Gay Consumer Behavior Often Reflects Value Structure
  • American Express Finds Lesbians Save And Invest More
  • Gay Consumers Seek Out New Experiences And Products
  • Stress Can Motivate Consumer Behavior Of Gays
  • Gay And Lesbian Consumers Often Favor Gay-Owned Businesses
    Spending On Consumer Products
  • Gay Men And Lesbians Spend More On Travel Than Mainstream Consumers
  • Fashion Can Be A High Priority
  • Gay And Lesbian Consumers Have Distinct Expenditure Patterns
  • Gay Consumers Spend Heavily On Electronic Equipment
  • Table 4-1: Gay And Lesbian Consumers: Purchases Of Compact Disc Players, Cassette Decks, And Home Theater Audio Systems
  • Books And Cd Purchases Rank High
  • Table 4-2: Gay And Lesbian Consumers: Purchases Of Compact Discs, Books, Pre-Recorded Video And Audio Cassette Tapes
  • Gay And Lesbian Consumers Support The Arts
  • Alcoholic Beverage Consumption Patterns Are Distinct
  • Gay And Lesbian Consumers Highly Interested In Health, Fitness, And Appearance
  • Table 4-3: Gay And Lesbian Consumers: Membership In Health Or Fitness Club
  • Table 4-4: Gay And Lesbian Consumers: Use Of Vitamins Or Mineral Tablets, Capsules, Or Liquids (Non-Prescription)
  • Food And Nutrition Expenditures Have High Priority
  • Gay And Lesbian Consumers Are Above-Average Spenders On Home Improvements
  • Table 4-5: Gay And Lesbian Consumers: Home Improvements Made In The Last 12 Months
  • Home Appliances And Furniture Have High Priority
  • Table 4-6: Gay And Lesbian Consumers: Furniture And Appliances Purchased In The Last 12 Months
  • Opportunities Remain In Many Consumer Product Areas
    Gay And Lesbian Consumers And The Internet
  • Most Gay And Lesbian Households Own Computers
  • Table 4-7: Gay And Lesbian Consumers: Ownership And Use Of Computers
  • More Than 9 Million Gays Online Worldwide
  • Gay Men And Lesbians More Likely To Be Online
  • Table 4-8: Gay And Lesbian Consumers: Amount Of Time Spent Using Online/Interactive Services In Last 30 Days
  • Online Financial Services Used Heavily
  • Shopping Online Increases

V. Gay And Lesbian Media

    Print
  • Gay Press Played Critical Role In Gay Rights Movement
  • Local Publications Gain
  • Circulation Of Some National Magazines Remains Flat
  • Advertisers Begin To Use Mainstream Media To Reach Gay And Lesbian Consumers
  • The Advocate and outmaintain Top National Spots
  • Gay Media Aim To Broaden Appeal To Mainstream Advertisers
  • Consolidation And Convergence Change The Landscape Of Gay Print Media
  • Arts And Gay News Account For Largest Editorial Segments
  • Fashion Supplement Planned
  • New Magazines Target Variety Of Niches In Gay And Lesbian Community
  • Magazines Published For Gay And Lesbian Parents And Their Families
  • HERO Provides Mainstream Bridge To Gay Community
  • Magazines Launched For Gay Teens
  • Venus Reaches African-American Gay Men And Lesbians
  • New Publications Launched For Gay And Lesbian Elderly
  • Gay Print Media Adapt To Internet
  • Gay Print Readers Tend To Be Male
  • Local Gay Print Readership Represents Affluent Market Segment
  • Table 5-1: Demographic Characteristics Of Readership Of Local Gay Newspapers
  • Readership Of National Publications Also Reflects Attractive Demographics
  • Table 5-2: Demographic Characteristics Of Readership Of Selected National Gay And Lesbian Publications
    Radio And Television
  • Gay And Lesbian Radio Has Relatively Few Broadcasting Outlets
  • Internet Opens New Horizons For Gay And Lesbian Radio
  • GAYBC Offers Broad Programming Choices On Its Webcasts
  • Triangle Radio Network Moves To The Web
  • LesBiGay Radio Provides Local Programming
  • Gay Television Outlets Remain Limited
  • In The Life Retains Top Spot
  • Mainstream Broadcasters Begin To Acknowledge Gay Audience
    New Media
  • Web Portals Improve Access To Gay And Lesbian Market
  • Planetout Subscribers Reach 500,000
  • Gay.Com Network Attracts Mass Marketers
  • Gay Financial Network Takes Off
    Direct Marketing
  • Direct Marketing To Gays Expands Dramatically
  • Gay Lists Pull Well For Big-Ticket Items
  • Direct Marketing To Gays Still Poses Challenges
  • Northwest Airlines Uses Direct Mail
  • Cardpack Mailer Uses Gay Vague Imagery

VI. Marketing To Gay Men And Lesbians

    Marketing Fundamentals
  • Gay-Friendly Corporate Policies Critical Element Of Successful Marketing Strategy
  • Opinions Differ On Domestic-Partner Benefits
  • Comprehensive Marketing And Promotion Programs Include Multiple Components
  • Substantial Market Research Precedes Major Campaigns
  • Gay Market Assessment Helps Companies Target Gay Consumers
  • Anheuser-Busch Successfully Manages Reaction To Ads
    Advertising Strategies
  • Three Schools Of Thought On Most Effective Advertising Styles
  • Some Ads Depend Upon Ambiguity
  • Effectiveness Of "Gay Vague" Ads Questioned
  • Outwardly Gay Ads Become More Common
  • Subtle Gay-Specific Messages And Images Gain Support
  • Phased Approach Is Popular
  • Mainstream Ads Still Common In Gay Media
  • Gay Pride Symbols Often Used In Ads
  • Agency Offers Stock Images For Gay Advertisements
  • First-Time Advertisers Choose Online Presence
  • Online Advertisers Use General-Market Ads On Gay Web Portals
  • Advertisers Use Magazine Supplements
    Trends In Advertising Expenditures
  • Gay Press Report continues Publication
  • Advertising In Gay Print Media Shows Steady Year-To-Year Growth
  • Local Newspapers Retain Top Spot
  • Figure 6-1: Growth In Advertising Expenditures In Gay Print Media, 1994-1999
  • National Advertisers Show Increasing Interest
  • Table 6-1: Trends In Advertising In The Gay Press By Category, 1997-1999
  • Advertising Expenditures In Lesbian Publications Are Low
    Promotion Strategies
  • Subaru Sees Lesbians As Key Element Of Marketing Strategy
  • American Airlines Finds Success With Its "Rainbow Teaam" And Sponsorship Strategy
  • United Airlines Battles American Airlines For Gay Market Share
  • Starwood Hotels Sponsors Gay Events
  • Hartford Financial Services Group Offers Discounts
  • Community Involvement Important Part Of Strategy For Beer Companies
    Adapting Products And Services To The Gay And Lesbian Market
  • IBM Customizes Palm Pilot For Gay Consumers
  • Mutual Fund Invests In Gay-Friendly Firms
  • Gay Retirement Communities Planned
  • Gay Travel Options Expand
  • Gay-Themed Films Build Audience
  • Hollywood Video Offers Gay-Themed Movie Section
  • Gay Pride Beer Launched
  • Gay-Product Catalog Builds Clientele
    Online Marketing To The Gay Consumer
  • Internet Opens New Vistas For Marketing To Gays
  • Homepharmacy.Com Enters Gay Market
  • Financial Services Industry Uses Internet To Reach Gay Customers
  • New Banks Offer Online Services For Gay Men And Lesbians

VII. Examples Of Advertising Targeted To Gay Men And Lesbians

    Overview Of Advertising Themes
  • Awareness Of Gay And Lesbian Issues
  • Gay Pride Symbols
  • Relationships
  • Scenes From Everyday Life
  • Breaking New Ground
  • Living With Hiv
    Financial Services
  • G&L Internet Bank Ads Focus On Relationships
  • Financial Services Firms Speak Directly To Gay And Lesbian Couples
  • Gay Financial Network Uses Humor In Mainstream Advertising Campaign
  • Taking Pride In The Gay Community
    Home Furnishings
  • Furniture Company Presents Family Image
  • Online Home-Furnishing Companies Advertise In Gay Media
    Alcoholic Beverages
  • Bacardi Appeals To Passion And Sensuality
  • Hiram Walker Uses Personal-Ad Theme
  • Wineries Reach Out To The Gay Community
  • Kobrand's Alizé Appeals To Several Segments
  • Brewers Compete For Gay Drinkers
    Pharmaceutical Companies
  • Pharmaceutical Firms Advertise Hiv Medications Heavily In Gay Media
  • Propecia Targets Gay Men
    Travel
  • Vacation Destinations In The U.S. Target Gay Tourists
  • Britain And France Battle For U.S. Gay And Lesbian Travel Business
    Other Sectors
  • IBM Reaches Out To Gay Consumers
  • Subaru Ads Use Subtle Themes

Appendix I: Examples Of Gay Consumer Advertising

Appendix II: Addresses Of Selected Gay And Lesbian Market Resources
Advertising Agencies/Public Relations/Marketing Consultants
Gay And Lesbian Publications
Internet Sites
Organizations

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