Recession? What Recession?

Prevailing market wisdom says gays are less affected by economic downturns than heterosexuals. But how wise is that wisdom?

BY Alex Davidson

March 02 2009 1:00 AM ET

"That myth of affluence has driven a lot of marketing to the LGBT community," Badgett says. "But more ad dollars don't help the gay community in any meaningful way. They don't offset our economic problems."

In a paper published in 2007, Badgett and other researchers analyzed the results of multiple studies and found that sexual-orientation discrimination actually lowers the wages of gay men; a range of studies cited in the research showed that gay and bisexual men earned 10% to 32% less than heterosexual men. Compounding that disparity for lesbians is the fact that women consistently earn less than men.

But there's plenty more market research out there about gay consumers than there is hard data, which only adds to the advertising drive. For example, according to a report put out by San Francisco-based Community Marketing Inc., 92% of gay men are more likely to buy a product if they see inclusive advertising used to market it; lesbians dedicate more than one third of their time online using e-mail; and both gay men and lesbians are now spending 60% more personal time on the Internet, for an increase of six to seven hours per week, compared to 2007. (Since ads are increasingly shifting online, company marketers pore over this kind of info.) And perhaps most important, LGBT people are widely seen as having strong brand loyalties.

Then again, the idea of gay resilience in the face of recession could be thrown into question with this particular downturn, which most economists say is the worst since the Great Depression. Only time will tell if the patterns hold. Says Witeck, "This downturn is historic, and we don't have a lot of things to compare it to."

Tags: Business

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