Marketing to the Gays: The LGBTQ Dollar

Since 1996, SPI Marketing has "enhanced commercial transactions between gay and lesbian consumers and corporate America, and in the process, to increased acceptance, understanding and communication."

CEO and founder Scott Seitz has been involved in gay and lesbian marketing for over two decades. Seitz, formerly in sales and marketing with Kodak and Pepsi, led GLBT market business development for Spencer Communications firm, focusing on strategic positioning and corporate imaging in the GLBT market, and cultivating relationships with national and local GLBT organizations and foundations. With SPI, Seitz has planned the strategic entry or supported existing programs targeting gay and lesbian consumers for clients like American Airlines, American Liver Foundation, America Online, The Advocate, AmNex Communications, Benson & Hedges, BoxTop, Gay and Lesbian Alliance Against Defamation, IBM, Pepsi Cola, Preferred Telecom, Seagram Americas and the gay mainstay ABSOLUT Vodka.

SPI's roster of impressive services include strategic planning and marketing, product sampling, sales promotion development, testing, and implementation, and research and focus group coordination. To many gay boys and girls, it is SPI's skills at event creation, representation, and management that we are all most familiar. While many agencies "check out" over the summer months, SPI's slate of events and community outreach is never more apparent. Whether it is the Diet Pepsi float at Gay Pride New York, the Ascension Party on Fire Island, or the massively popular One Mighty Weekend at Walt Disney World; SPI is involved in the biggest GLBT events of summer 2008. AC was fortunate enough to get a special interview with Seitz, only a few days before another immense undertaking in Orlando.

AC: What motivated you to start SPI?
Seitz: I wanted to leave corporate America, and to get involved in gay and lesbian marketing. RSVP Cruises had invited me and some other individuals on a cruise, to talk about their marketing campaign. Myself and two others met, and we thought we would be a good team. We all left where we were and tried our own venture, and it has been really fun.

AC: Then SPI was born?
We started as Spare Parts Incorporated, a very plug and play concept. We liked the image and idea of it, because gay and lesbian marketing was just that...We were spare parts to the arms and legs of a marketing team. We started picking up clients; one of the first was working with Witeck -Combs and writing the sales and marketing plan for American Airlines.

AC: What was the landscape like in 1996?
In 1996 you were dealing with some of the first direct marketing to the gay and lesbian market from businesses. There had been advertising, but nobody was focusing on marketing, on promotions, on experiential marketing...Absolut had been in the gay market since 1981. The LGBT consumer's affinity was always very good because it was a big name in the industry that stuck with the gay community for the tough times. Absolut was a friend to the gay community when not many other people were...So, when we picked up Absolut in '96, it had already a very strong relationship with the gay community.

AC: How did you and SPI change the idea of marketing to the gay community?
What SPI brought to the table....We began to create programming on an annual basis. We developed one large sponsorship, smaller sponsorships, large targeted programs, samplings at bars and clubs, creating our own kits for people to do at Prides...This was the first time someone had come in and really linked direct marketing, PR and advertising all together in one package.

AC: So flash forward 10 years, and now EVERYONE is going after the gay dollar?
Seitz: [Laughs] No, it is still a far cry from everybody going after the gay dollar. It is still a niche market, and it requires a lot of work. But, there is a lot of growth and opportunity.

AC: How has the gay market evolved in 10 years?
Seitz: We are more like our straight counterparts. Civil rights advances have mainstreamed some of the gay community. But, we act like single straight people until we are 72. Even when we couple, we are still likely to be out and about. The gay community is an active and vibrant community. We are much more interested in restaurants, bars, fashions items, and then married straight couples. Gay couples are "uber-couples" ...And when looking at different segments of the gay population, they all shop and spend very differently. It is still highly complicated and not easy to simplify.

AC: What recent challenges has SPI faced?
Seitz: Not necessarily any NEW challenges, besides the daily ones. We have had an exciting development, business-wise. We have this wonderful partnership with Moon City, the advertising agency. We have grown our agency to be marketing, strategic planning, media buying, field implementation, and so our partnership with Moon City makes perfect sense. The real challenge, well...for me the challenge is that SPI has evolved and grown, just as the gay community has...But now, we need to communicate to our clients that there is a shift in the gay market. 10 years ago, you could get away with throwing the gay community an ad and doing a few promotions. That won't work anymore; now it is not a gay market... it is a gay consumer. It has grown BEYOND a gay market.

AC: Give me a little free advice - How does one reach the "gay consumer."
Seitz: It is about taking clients and making their products relevant to the gay consumer. Quality price, fashionable, gay friendly....You need a client that lines up with that and a product that works for the gay community.

AC: It seems like every vodka company wants a piece of the gay market....
Seitz: There are close to 200 new brands of vodka on the market. Many of them vying for the gay market. Because Absolut has been successful with gay outreach, it is the first place that other vodkas want to start....I wouldn't go as far to say people are jumping in head first, but there is always strong interest.

AC: There have been major shake-ups in gay media, how does that affect your marketing plans?
Seitz: The evolution of the gay consumer and the media is still incomplete. On the media end, the consolidation of the Advocate and Planet Out years ago and the launch of Logo brought a new dimension to the media landscape. When gay "broadcasting" started and content went from print to online and online to radio or TV, you had another avenue to reach the gay consumer. It presented more choices to the buyer.

AC: With the development of Logo and Here!, how relevant is the local gay magazine or newspaper? Is print dead in gay media?
Seitz: I think we have seen that the tabloid and the bar rag sectors are still good. People still go to print media, and the bar rag. If you are talking about single men and women between 22 and 40, maybe even 50, local print media is still very, very, relevant. The struggle is national print media. Broadcast media is raising the bar. Plus, other publications are interested in the gay consumer-beyond the Advocate, Genre, and Instinct.

AC: So you would agree there are problems for gay magazines?
Seitz: National is going through a transition, or hopefully they are...They are not just competing with each other anymore. They are competing with a lot more mags then just classically gay periodicals. They are competing with Men's Health, People, OK, US...these are all national magazines going after the gay consumer. When polled, gay consumers believe and trust gay news and gay media. They trust the media outlets that self-identify as LGBT. But there is just going to be so much competition...I can't imagine the ongoing interest in the gay and lesbian dollar is going to go down.

AC: So what does that mean for the future?
Seitz: I think we are going to have similar developments to the African American market. We are going to have some stuff that is strictly targeting the community, and we are also going to crack the ceiling. We will still go for the same 3 million people, our solid base - with the focus on print campaigns. But this is the first time we are going to bust out past the 3 million person mark. I think it is going to be amazing. We are going to see the focus on the gay consumer, and that is going to grow media budgets. Eventually, as the times change and comfort and education levels change - marketing will move into vehicles similar to Time Out New York. Broader papers...with gay and straight readerships...like the Village Voice. Gay consumers will be targeted everywhere, through messaging designed to specifically appeal to them.

AC: So gay advertisements in Time Magazine are not too far in the distant future?
Seitz: Years ago we did research, and we found out the most read publication in the gay community was USA Today! It is also going to change (23milion) other people who have brought a niche - just not high

AC: I am sure there is also different ways of reaching different segments of the gay community. Marketing to the Bears versus the Twinks...
It is mostly a generational factor. AIDS shaped and formed of a lot of the 40 plus crowd's affinity. It has made 40 plus consumer very different from their younger counterparts. The 29 year old consumer is happier, more carefree. In both the gay and lesbian community. That is something that has to be considered in the messaging. The older generation remains more political and socially active, and the younger generation is a bit different.

AC: And the lesbian community and transgender community are going through their own evolution. Coming into their own, so to speak?
Seitz: I think the same changes are going on in the lesbian community. They are getting their voice, and it is being heard by corporate America. Same for the Trans community. Each community has their own challenges, and we can't be lumped into one big group.

AC: Any final thoughts?
Seitz: The evolution of our community is moving at a very fast rate and we are maturing much faster as consumers. You haven't seen the peak yet and the old methods of reaching gay and lesbian consumers and creating brand loyalty don't work anymore. At SPI, we like to think we're charting the future and helping clients navigate some difficult terrain.

http://www.spimarketing.com/