UK Brands Have to Jump Into Gay Market in 2006 – New Research Shows Why

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New UK laws will require companies to understand and meet the needs of Britain's 3 million gay and lesbian customers – who now account for more than £70 billion pounds in earnings each year. Research from Australia and the US revealed today that UK companies risk falling behind overseas counterparts in marketing to lesbian and gay consumers. Australian and US companies spend around four times as much as British business – and reap far more benefits as a result of more effective gay marketing expertise.

New research results from the US reveal that in 2005, more than USD$212 million was spent by corporate America advertising to gay consumers, a figure that dwarfs British expenditure.

One of the world’s foremost authorities on marketing to gay consumers, Ian Johnson, says “British business, even on a relative population basis, is spending at less than a quarter of that rate, and is currently missing out on significant profits as a result.”

“While corporate Britain is still just dipping its toes in the water, US and Australian brands have already got their gear off, jumped right in and have come out safely on the other side – complete with their share of the market and increased profits,” says Johnson.

Johnson is Managing Director of Out Now Consulting - a company relied upon by many of the world’s largest brands including Barclays, Hilton Hotels, Lufthansa, IBM and Citibank to help them understand gay consumer behaviour.

“With very few exceptions UK brands are missing out on significant profits due to being poorly served by their existing marketing agencies, as they fail to keep pace with this clear global marketing trend,” added Johnson.

New laws also mean that from October 2006 UK companies must ensure they do not discriminate against people on the basis of sexual orientation in the provision of goods and services, as well as in their advertising.

According to Whitehall, gays and lesbians make up around six percent of the total UK population and Johnson says brands must utilise better targeted gay marketing to reap increased profit opportunities in a gay market now valued annually at more than £70 billion earnings.

A groundbreaking UK conference will address these issues next month. Johnson presents the keynote address at The Pink Pound Marketing Conference on 22 June in Millbank, London.

This new conference event has been developed by this years national CEA Award winners, Ingenious Group, as a means to help British marketers across all sectors learn how to better position their brands in the GLBT marketplace.

Conference producer Jean Collingwood of Ingenious Group believes the need for British business to understand gay marketing is now more imperative than ever. “New legislation will come into force in just a few months under the Equality Act which will outlaw discrimination in the provision of goods and services to lesbian, gay and bisexual people, as well as in advertising that will affect every single sector of the marketing community,” says Collingwood.

“Companies here are already investing in improving customer insight and they understand how a holistic approach to diversity can impact on their bottom line,” says Collingwood. “The big issue now though is not whether brands should include gay consumers in their marketing efforts but how far they will need to go – for both marketing and legal reasons.”

"Despite the UK enjoying a well-deserved reputation as being one of the most socially tolerant nations in the world, Britain’s businesses have been amongst the slowest in the world to recognise that gay consumers, with fewer children in gay households and higher resulting disposable incomes, are one of the dream markets of the new millennium," according to Johnson. "We think that is because British business is still in the dark about how to go about unlocking the large profit potential on offer. Gay consumers' attitudes remain a mystery to most UK brands."

Australian research findings show the large brand loyalty potentially on offer to UK brands – with three out of four Australian gay consumers favouring brands that they see targeting them effectively.

Johnson cautioned though that a lot of what companies see as ‘targeting’ gay customers is often wasted money. "Campaigns that hit the mark effectively can significantly benefit the brand. The key word here is ‘effectively’," he added.

An unrivalled line-up of some of the UK’s most respected organisations will be discussing the very latest research and gay market insights including BT, Hilton, Egg, Out Now Consulting and VisitBritain. Bates Wells and Braithwaite and the Advertising Standards Authority will be covering the impact of the latest UK legal developments.

“British brands risk falling far behind the US which has seen leading brands across all sectors including finance, travel and automotive actively develop gay marketing strategies to increase their brand's market share," says Johnson. "This combined with the new UK laws, means that British business must now learn about creating and selling relevant products to the gay consumer."

The Pink Pound Conference is creating unprecedented levels of interest and debate across every sector of the marketing community. Some of the UK’s biggest brands from automotive, household products, lifestyle, the alcohol industry through to hotels, music, consumer electronics and leisure are attending to learn more about how they can market effectively to UK gay consumers.

“One thing everyone agrees is that stereotypes, insults and badly executed marketing has had its day and needs to improve in the UK. British business clearly must learn how to understand this group of UK customers effectively,” says Collingwood.

Further information contacts:

Ian Johnson

Managing Director, Out Now Consulting

Tel + 32 - (0)2 - 514 6443

UK mobile +44 - (0)7906 553 990

BE mobile +32 – (0)4737 60886

Jean Collingwood

Managing Director, Ingenious Group

Tel + 44 - (0)1482 - 442 611

Mobile +44-(0)7833 765 314

Notes to editors:

New “Getting Equal” government regulations, under the Equality Act, come into force in October 2006 that outlaw sexual discrimination in the provision of goods and services as well as in advertising appearing in the UK.

Whitehall figures released in December 2005, and research from the US (Yankelovich MONITOR study), put the average levels of homosexuality in society at six percent.

Out Now Consulting research from Australia indicates that three out of four gay consumers favour brands that target them effectively and inclusively.

The Gay Press Report (Rivendell Media, Prime Access Inc US, 2005) – released May 2006 – shows that total US advertising spending in the gay market topped USD$212 million during 2005.

The Out Now 2005 Diva and Gay Times Readers Survey values the gay market at £70billion.

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