Lesbian, Gay, Bisexual and Transgender (LGBT) consumers are a powerful force in the retail industry. How powerful? They have four times the buying power of Hispanics and African Americans, two times the buying power of Asian Americans and four times the buying power of millennials. However, the LGBT audience remains largely misunderstood due to assumptions based on stereotypes and generalizations.
Did you know:
LGBT buying power is increasing.
There was a 20 percent increase in LGBT buying power between 2006 and 20121, and at current rates, growth could exceed $1 trillion by 2020. Gay-partnered men have the highest household income, surpassing married heterosexuals and lesbian-partnered couples2. Taking into account household size, gay men have the highest amount of discretionary spend (money left over after necessities)2. In fact, 40 percent of gay men spend more than $500 a month on discretionary items3.
LGBT consumers shop more frequently, and spend more when they shop.
In terms of shopping habits, LGBT consumers make 16 percent more trips to the cash register than heterosexuals, and spend 8 percent more3. In fact, male same-sex households make almost 30 percent more shopping trips yearly. The top three areas where LGBT shoppers tend to spend more are bookstores, wine and computer/electronics.
The LGBT household is changing.
There has been a marked increase in the number of self-identified LGBT households. Specifically, the number of same-sex households saw an 80 percent increase from 2000-20101. The majority of this audience live in urban areas, with many having plans to expand their families. In fact, 32 percent of men and 67 percent of women would like to have kids in the future4.
LGBT consumers are on trend.
LGBT consumers are early adopters and influencers. They keep up with the latest styles and trends, compared to heterosexuals. Technology is a must for many LGBT consumers5. In fact, lesbian/bisexual women are more than 2.2 times more likely than their heterosexual counterparts to be considered “mobirati”—adults who cannot imagine living without their cell phones6.
They support brands that support them.
LGBT consumers spend on brands that support their issues7.
55 percent will choose to do business with companies that are committed to the diversity/equal treatment of the LGBT community.
70 percent would pay a premium for a product from a company that supports the LGBT community.
78 percent of LGBT adults and their friends, family and relatives would switch to brands that are known to be LGBT-friendly.
Brands with anti-LGBT policies have high negative corporate viewpoints within the LGBT community. However, many top-perceived brands among LGBT consumers do not advertise to this audience specifically8.
One audience. Numerous opportunities for retailers.
LGBT is not a homogenous group—it comprises subsets, each with distinct traits, outlooks and characteristics. With increased segmentation, companies can appeal to specific segments within the LGBT community and better tailor their advertising to capture the hearts and mind of this audience.