Pink pound’s value rises in mainstream markets

Brands that appeal to a wide crosssection of society are choosing to engage with the gay community in their major ad campaigns – using both mainstream and niche media.

pink pound

TV stylist Gok Wan and comedian Alan Carr have carved their identities out of being loud and proud about their sexuality, earning them a following of gay and straight audiences alike. Well-known personalities such as these have paved the way for gay themes to be aired in the mainstream, creating opportunities for brands that have previously been reluctant to engage with the gay consumer.

There is a growing realisation now that the gay market is a force to be reckoned with – Millivres Prowler Group (MPG), publisher of Gay Times, Pink Paper and Diva, claims that about 6% of the UK population is estimated to be gay (be it male or female), and not just 1.5%, as the Office of National Statistics released last month.

The concept of the “pink pound” has been in use since the Nineties, but it is only in recent times that this market has moved into the mainstream. Brands such as Lloyds TSB, Ikea, Pepsi and Heinz (see below) have all launched campaigns that appeal to a gay audience.

Lloyds TSB made headlines for the work it released in January, continuing its cartoon families theme to depict a male couple aspiring to turn their house into their dream home through the bank’s mortgage offering.

Agency RKCR/Y&R collaborated with gay marketing consultancy OutNow to produce the ad, aiming to demonstrate that Lloyds can provide banking services for the gay community.

The creative was originally planned to appear only in gay media, but Lloyds TSB’s board were so impressed with the work they decided to release it to mainstream media such as The Independent and The Telegraph. 

Reaching out to both gay and mainstream channels has led OutNow chief executive Ian Johnson to describe Lloyds TSB as a “poster child” for gay branding. He adds that normally mass marketing is not the appropriate way to reach a niche audience, but Lloyds wanted to demonstrate its values to a mainstream audience.

The campaign was an extension of a journey the bank has been taking for some time. It has introduced a strategy to encourage members of the gay community to work for it. This strategy was cemented last year when Lloyds TSB was named by lesbian, gay, bisexual and transsexual (LGBT) lobby group Stonewall as the UK’s most gay-friendly employer.

Lloyds TSB group chief executive Eric Daniels said last year that the “internal culture has improved since the introduction of our sexual orientation strategy.”

Changing the culture of Lloyds is not only encouraging a more diverse workforce, but will boost the bottom line, according to research. The gay community is much more likely to buy goods and services from a brand that is known to be gay-friendly, according to a study carried out by Stonewall last year.

Despite these findings, Kim Watson, managing director for media and marketing at gay media owner MPG, claims that many brands have yet to acknowledge the benefits of gay-friendly communication. The pink press might seem like an obvious route to getting a message out to the gay community, but Watson says many brands are shying away from MPG titles, despite them having a combined circulation of about 500,000 a month.

Similarly, QSoft, which owns the Gaydar and Gaydar Girls websites and Gaydar Radio, has struggled to convince big brands of the power of its platforms, even though Gaydar Radio attracts 500,000 unique listeners a week.

QSoft commercial director Mark Mangla says: “This makes us the third largest commercial radio station in the UK, so you would think that advertisers would be bashing our door down. Media buyers are young, straight guys and it’s not that they are being biased or bigoted, but outlets like us are just not on their radar.”

QSoft experienced a turning point last year when cosmetics brand Clinique for Men took a chance with a summer campaign that ran on Gaydar Radio’s programmes and website. O2 is another big brand to have got on board this year, with a campaign currently live. Mangla claims the Clinique campaign registered an 18% purchase rate among the Gaydar Radio audience, and 88% said they would consider buying the brand for the first time.

Clinique and O2 join the slowly growing raft of mainstream brands extending the gay marketing arena beyond brands whose identities have traditionally lent themselves well to this consumer, such as Absolut Vodka, a brand that is well known for championing gay rights.

But Nick Gadsby, associate director of research firm Lawes Consulting, says the rise in gay civil partnerships, and the Liberal Democrats putting fully-fledged gay marriage on their agenda, means gay families will become a more conventional part of British society.

Gadsby told a Westminster Forum in September: “What you’re going to see [in society] is a lot more gay couples settling down to a relatively traditional conservative life of shopping at Sainsbury’s and trying to get their kids into the best school.”

Specialist holidays: Thomson’s Freedom offers a GayComfort seal of approval on listed hotels
Specialist holidays: Thomson’s Freedom offers a GayComfort seal of approval on listed hotels

This means that marketers need to focus on becoming more inclusive in their messaging. Gadsby says: “The traditional areas [targeting the gay community] have been entertainment and luxuries, but you’re going to see the pink pound diverted into more traditional family commodities; so, for example, family cars as opposed to sports cars,. The pink pound is being slightly diverted from the more fun aspects that are traditionally associated with gay culture.”

Indeed, a range of targeted services from mainstream brands have launched in the past few years to meet an anticipated specialist need from the gay community. Thomson Holidays’ specialist Freedom offering and The Co-operative’s Funeralcare division in conjunction with gay funeral specialist Pink Partings are two examples of these.

Freedom offers a “GayComfort” seal of approval on all the hotels it promotes on its site, which product manager Tommy Lynch says “allows us to choose hotels that are willing to take our training on board to help them better understand how to work with gay customers, especially in different countries with different cultures. We wanted to do more than just advertising because people can be cynical about corporations becoming ‘gay friendly’.”

The Co-operative Funeralcare head of marketing Lorinda Robinson says the company began working with gay wedding specialist Pink Weddings about three years ago before it launched its Pink Partings arm, with the support of The Co-operative sub-brand.

She says: “The Pink Partings website is very much for the LGBT community, providing a safe space where they can get the right information about funerals without being judged.”

Not only do Robinson and her team consult with LGBT lobby group Stonewall on best practice, they also rely on insights from The Co-operative Group’s 500-strong internal LGBT network. The company also conducts research with its 6 million members.

“We are carrying out research among our members to find out what the needs of this community,” she explains.

“We are always wanting to understand what’s required of us and how we can meet this.”

Despite such progression, there is still a view that gay men are high earners who spend a lot on entertainment and their appearance. But MPG’s Watson says brands that focus solely on reaching gay men could be missing opportunities to engage with similarly affluent gay women. She claims that a reader survey in 2005 showed car and home ownership to be more prominent among Diva readers than those of Gay Times.

MPG is also working with OutNow on a pan-European study into gay and lesbian lifestyles that it hopes will provide a better understanding of what brands can do to attract a lesbian audience.

QSoft’s Mangla likens the marketing sector’s approach to the gay community as being in a similar place to when brands began considering ethnic demographics in their messaging. He says: “It is now standard for bluechip brands to use black and Asian people in their advertising. We haven’t quite got to this stage yet in terms of the gay community but we are moving in the right direction and what is happening now can only be a good thing.”

VisitBritain head of global campaign marketing Iain Morrison agrees, warning that brands shouldn’t generalise when marketing to this community (see Viewpoint, above).

The gay market forms part of a strategic marketing strategy for VisitBritain, and Morrison says the brand looks at targeting individual sub-sets of the gay community rather than developing a one-size-fits all marketing communication. He says: “The more segmented you are the more you will resonate with your target audience.”

Case studies

UK advertisements featuring gay characters

  • Ikea promoted its catalogue in 2009 by depicting a man coming home to his flat to find his girlfriend cooking dinner for her new female partner, with the strapline: “It’s change time”.
  • Pepsi aired an advert in 2008 that showed two men in a bar encouraging their friend to chat to a woman. The man drinks PepsiMAX to get confidence and walks past two women, one being model Kelly Brook, before approaching a man at the end of the bar.
  • Heinz released an advert in 2008 showing a man making sandwiches for his two children and his male partner. The two men then kissed each other goodbye before going to work. Heinz withdrew the ad after receiving several complaints that it was “inappropriate”. However, the brand’s decision to pull the ad resulted in a boycott of the brand by both gay and straight people.

Source: Stonewall’s guide on how to market to gay consumers



Iain Morrison, head of global campaign marketing, VisitBritain

We identified two niche segments that we have begun working with in some markets: “Gen Y” youth and gay and lesbian.

It’s a growing segment increasing in wealth. The cliché of “double income no kids” certainly rings true; the gay community in the US travels more than their mainstream counterparts – 87% of this segment have passports compared with the national average of 28%, for example.

Segmentation is very important. Targeting the “gay market” is like referring to the “Asian market” – there is no single gay consumer.

Another thing that is often missed is on-ground support – in the US we have found sponsorship of events highly successful. It’s not the most immediate way to see return on investment but it’s a way to drive future brand preference and can pay dividends.


    Leave a comment