[copied without permission from the Wall Street Journal, 18 July, 1991, page B1] Overcoming a Deep-Rooted Reluctance, More Firms Advertise to Gay Community Last year, Columbia House Co. began advertising directly to some of its best customers. But that wasn't business as usual: The customers, readers of about 70 weekly newspapers from Birmingham, Ala., to Boise, Idaho, are homosexual. Columbia House, a compact-disk club that is jointly operated by Time Warner Inc and Sony Corp., began its campaign in the gay press because readers of the selected papers tend to be "upscale and cutting edge," says Linda Andersen, advertising vice president for the club. She add: "It's just another vehicle to get at a market that's logical for us." That logic is starting to influence a growing number of businesses. "We've enjoyed a big increase in ad linage," says Ken Newlt, marketing director for the national gay news magazine the Advocate. He says linage in the May 1991 issue rose 50% from a year earlier -- mostly because of new ads for Hollywood feature films and general-interest home videos. Persistence was key. "It has a lot to do with us hammering away at people," Mr. Newelt says. Ads are also selling briskly at Genre, a national gay life-style magazine that published its second issue in June. Unlike the Advocate, Genre is entirely glossy and won't accept personal or phone-sex ads. Because of that policy, a Genre spokeswoman says that magazine racked up 18 pages of national ads for its first issue and 25 pages for its second. Among the big adveristers: Atlantic Records and publisher Prentice Hall. Of the businesses now reaching out to homosexuals, some, like Columbia House, are departing from past practices. Other advertised to gay people in the late 1970s and early 1980s and then retreated, especially during the onset of the AIDS epidemic. `Lots of Meetings' In the late '80s, "I sat around twiddling my thumbs," says Rivendell Marketing Co. President Joe Di Sabato, who sells ad space in the gay press. "I couldn't even get meetings with people. These days, I still have a hard time selling, but I get lots of meetings. As far as the resistance is concerned, "Homophobia is certainly part of the problem," Mr. Di Sabato says. "If this were any other market in the world, I'd be beating them off with a stick." Certainly, most corporations aren't yet banging down doors to sell to gay people. Among the nay-sayers is Carter-Wallace Inc. The company's Trojan condoms brands prefers advertising in mainstream men's magazines such as Details instead of the gay press -- even though studies show that homosexuals use more condoms per capita. "Gay people don't read different magazines than other people do," says Mark Klein, vice president of marketing for Carter-Wallace. Others are reluctant to market to gay people because they say they lack sufficient marketing data. While there are direct-mailing lists for all sorts of categories, such as doctors who fly airplanes, there aren't corresponding lists for gay people. that's because homosexuals often won't identify themselves as such, fearing discrimination. "It's hard to convince clients to market to gays because there aren't more nummbers," says Jack Sansolo, the openly gay president of the U.S. division of the Hill, Holliday, Connors, Cosmopulos advertising agency. Still, in gay households, "you're talking about two people with good jobs, lots of money and no dependents. This is a dream market," Mr. Di Sabato says. Some companies don't need more convincing than that. Midway Airlines, which has been operating under backruptcy proceedings and trying to woo new customers in its core Chicago market, has been taking out full-page ads in the gay press there. Vodka Pitches Similarly, the liquor industry, traditionally the biggest advertiser to the gay community, is increasing its pitch to homosexuals. While big names like Absolut and Remy Martin cognac routinely take out full-page ads in the gay press, smaller brands are showing renewed interest. Stolichnaya vodka, which stopped advertising to niche markets last year, says it will resume once it completes its current national campaign to make its image more hip. "We can't wait to go back" to the gay press, says Michael Edmeades of Stolichnaya's New York-based ad agency, Calet, Hirsch & Spector. Finlandia vodka, a smaller brand that moves in the shadows of Absolut, is targetting gay people in an effort to gain market share in Chicago. It doesn't advertise in the gay press; but for the past year it has been offering a special deal at about 90 of the city's gay bars: From each Finlandia sale, 50 cents goes to the Howard Brown Foundation, which researches AIDS. The promotion is going so well that Heublein Inc., Finlandia's importer, says it may try it in other markets. Some of the corporate awareness of homosexuals has come from business moves within the gay community, such as issuing gay-oriented credit cards. About 500 people have signed up for a "Pride Card" MasaterCard through the Pride Foundation, a non-profit gay organization in Seattle. Elsewhere, the Dallas Gay Alliance Credit Union, believed to be the only credit union of its kind in the country, this year offered its own MasterCard; colored pink and gray, the card features the word "gay" and a pink triangle, the symbol the Nazis used to brand homosexuals during the Holocaust. So far, about 300 people from as far away as Maine and Hawaii have signed up, bringing the credit union's total membership to about 750. The news has turned heads. After reading about the new Dallas credit card in his local newspaper, Skipp Shimek, marketing director for Target Management Inc., called up to hawk his wares: customized long-distance calling cards. "Gay people spend money, too. And I'm a businessman," says Mr. Shimek, national marketing director for the privately held, Fort Pierce, Fla-based tele-communications company. He says he's not afraid of a backlash from heterosexual customers, usch as the letter campign American Telephone & Telegraph Corp. endured last month after it announced a "Gay Awareness Week" for its employees. Angry letters "wouldn't bother me in the least," says Mr. Shimek, who hopes to strike a deal with the credit union once it signs up at least 1000 members. At least one bank is also reaching out to gay people. Consider U.S. Bancorp, a Portland, Ore. bank holding company with approximately $19 billion in assets. As part of its Christmas charity program, the company's U.S. Bank of Washington unit took out a full-page advertisement in a concert publication for the gay Seattle Men's Chorus. The response: one critical letter, one angry phone call and 50 letters of praise -- including several promises to open new accounts. Says Molly Reed, a vice president and manager of community relations for U.S. Bank of Washington: "It turned out to be a very wise marketing move." The bank may increasingly target part of its financial services guide at homosexuals, says advertising manager Kerry Nisco. Among the ideas: The guide might include apicture of a gay couple applying for a home loan. "This bank has stepped up to the fact that diversity exists in the marketplace," says Ms. Nisco. "We are going to be a leader in the field and take some risks." ---------------------------------------------------------------- [from a boxed table] `A Dream Market' Gay households have characteristics sought by many advertisers. All data is for 1988, most recent available. Average annual household income $55,430 $32,144 College graduates 59.6% 18.0% Professions/managerial positions * 49.0% 15.9% MasterCard Users 45.0% 23.3% Visa Users 53.6% 31.4% Vodka drinkers 49.7% 22.7% Domestic wine drinkers 57.8% 21.5% Overseas travellers (1987) 65.8% 14.0% Frequent Fliers ** (1987) 26.5% 1.9% * Percentage of those working ** Five or more domestic flights Source: Simmons Market Research Bureau, Inc.; US Census Bureau ---------------------------------------------------------------- This comes with my commentary because these numbers are so highly biased. I would guess that they came from a survey of Advocate subscribers (since the Advocate sells their mailing list). The US Census Bureau does not have any information about who is gay or not. I suspect the sample group is heavily biased toward men, and probably white middle-to-upper-class men at that. Further evidence for the Advocate is the information about vodka and wine drinking. It is probably the national publication most interested in the vodka drinking habits of their readers. That aside, some of the numbers are ludicrous. If we assumed that 10% of the American population satisfies their definition of gay, we conclude that 34% of overseas travellers are gay. Being one of those 34% (one in three), I find that highly doubtful. Even if gays are only 4% of the population, they would be 16% of the overseas travellers (one in six). The federal government won't fund any demographic research on sexual orientations (since Kinsey). Perhaps marketing companies will start since the market seems lucrative.