Two years ago, Paul Alfano decided to rethink some of his marketing strategies. His business, The Hot Tub Store, is located 30 miles west of Asheville — a city in North Carolina dubbed by some as the San Francisco of the Southeast — and he wanted to target potential buyers in the area’s growing gay and lesbian population.
Alfano soon joined the ranks of several companies advertising on Gayashvilleonline.com, and though he hasn’t received much business specifically from that site, roughly 12 percent of his client base today consists of gay or lesbian customers, most of whom purchase tubs in the $10,000 price range.
“The more of a demographic you can reach, the better you are,” explains Alfano, who attributes those sales to word-of-mouth. “You really need to look at your area, see who’s out there, try and get a broad view and appeal to that market segment.”
Others have taken a similar approach. Alex Brodsky, marketing director at Creative Energy, began a campaign to target minority groups, including the gay demographic. His outreach for the company’s three San Francisco-area showrooms includes listings in business directories such as gaypinkspots.com.
However, when it comes to marketing to gay and lesbian consumers, Alfano and Brodsky are in the minority, says Don Riling, vice president of sales and operations at Olympic Hot Tub Co. in the greater Seattle area.
As a whole, he says, the industry has taken a back seat on the issue, failing to educate dealers on the subject, which in turn makes it harder for them to establish or lead successful marketing campaigns to these audiences.
“There’s not a good platform or class for them to go to and say ‘How do I talk to these people?’ and ‘How do I market to them?’” Riling notes. “Because it is unfamiliar territory, people don’t know where to begin.”
Even before Riling joined Olympic nearly 17 years ago, the company was advertising within the gay community. Over the years, he’s added to the original strategy implemented by the store’s owner, Alice Cunningham, helping to hone in on what works and what doesn’t, and increasing their efforts in “underserved” markets.
“[The spa industry is] never going to grow and gain the awareness or the market share that we deserve unless we start thinking outside of what we’ve always done and expand our base of who we talk to,” Riling explains.
There are two primary ways hot tub dealers can target gay and lesbian consumers cost-effectively and without embarking on a large media campaign, he says. One is by joining a local LGBT chamber of commerce. Olympic is one of more than 1,000 members of the Greater Seattle Business Association, one of the country’s largest and oldest gay chambers.
Riling frequently attends — and has even sponsored — luncheons and other functions that, unlike “general market” business chambers, have provided him with a chance to promote the company to gay and gay-friendly business owners in an unprecedented manner. Several of the members, including the executive director, now own a hot tub from Olympic thanks to the company’s participation in the chamber, he says.
Indeed, most autonomous chambers have large percentages of businesses that consider themselves allies of the LGBT community, says Sam McClure, director of affiliate relations for the National Gay and Lesbian Chamber of Commerce.
“The reality of doing business in today’s economy is that it’s essential to find other business people to work with to get your product out there,” she says. “People in the pool and spa industry will find these connections at our affiliate chambers all around the country.”
Another way to reach these consumers is to sponsor a non-profit organization or an event hosted by one, Riling suggests. Olympic, for example, supports the Pride Foundation in the Pacific Northwest, and advertises its company name alongside major corporate sponsors such as Boeing. Another option is to sponsor an AIDS walk, he says. This year, Green Bay Packers’ linebacker Clay Matthews was honorary chair of the Wisconsin AIDS walk on Oct. 1, and his team joined Starbucks, SC Johnson and others as official sponsors, proving that the event targets nearly all walks of life.
Riling’s strategy is not unfounded. According to the NGLCC, 88 percent of gay men and 91 percent of lesbians reported that their purchasing decisions are influenced by corporate sponsorships of LGBT events and organizations. And three out of four LGBT individuals have switched brands when a company has exhibited support of their community.
1. The total buying power of the gay, lesbian and bisexual adult population in America was expected to be $845 billion in 2011.*
2. The combined buying power of racial minorities (African Americans, Asians and Native Americans) will rise from $1.6 trillion in 2010 to $2.1 trillion in 2015, accounting for 15 percent of the nation’s total buying power.**
3. The buying power of Hispanics will rise from $1 trillion in 2010 to $1.5 trillion in 2015, accounting for nearly 11 percent of the nation’s total buying power. *
4. Same-sex couples live in 99 percent of all U.S. counties.*
5. There are 62 state, local and international affiliate LGBT chambers of commerce, with at least one in more than half of the 50 states.*
6. At least 2 million LGBT individuals are approaching or have already reached retirement age; by 2020, approximately 5.7 million, or 25 percent of the LGBT community, will be 50 or older.**
* National Gay & Lesbian Chamber of Commerce
** Selig Center for Economic Growth