When Gay Is Gold : O.C. Businesses Court a Lucrative, Loyal Niche Market

South Coast Repertory recently held a special evening for Orange County’s gay community.

The Costa Mesa theater offered “Hay Fever,” by gay playwright Noel Coward, followed by a Champagne reception with director William Ludel. The event was advertised in a publication that circulates in the gay community, and it drew a larger-than-usual crowd at the 500-seat theater.

With that event, South Coast Repertory joined the ranks of mainstream businesses in Orange County that are actively seeking gay patrons. In this lingering recession, said Laura Johnson, who is in charge of audience development, bringing in new patrons such as the gay men and lesbians who attended the Coward party is essential if the theater is to prosper.

The average household income for gay men nationwide is $51,000 and for lesbians, $43,000, according to a market research firm, Overlooked Opinions in Chicago. That compares to an overall household income of $37,000 nationally. All of those numbers would likely be slightly higher in affluent Orange County, said Rick Dean, vice president of Overlooked Opinions.

Such figures are prompting business people beyond the arts community to take notice.

One of those is window-blind installer Larry Gaddy, who recently began advertising in the Pink Pages, a Yellow Pages-like directory. Published for the first time in April, the Santa Ana-based Pink Pages is a guide to gay-friendly businesses in Southern California.

Gaddy said that sales of window blinds at his Laguna Hills company are half of what they were a year ago, and even then business was slow. He sees the gay community “as another market to reach. We’re not prejudiced about who buys them, so long as they buy them.”

Reasons for seeking gay patrons vary. Some merchants note that gay consumers generally are affluent and loyal. Others say they want their businesses to stand for greater tolerance of all lifestyles. And many say that, with several new publications now reaching gays in historically conservative Orange County, they have their first opportunity to reach that market.

“We’re kind of behind the times,” South Coast Repertory’s Johnson said.

Robert Whyte, who runs the Orange County office of the AIDS activist group ACT-UP, said he has observed a new openness within the past year. As an example, he said, a manufacturing company last year posted a non-discrimination statement in its lobby, including language about sexual orientation.

“I was very impressed,” he said. “It’s not an ambiguous statement.

“I wear a ‘Support Our Gay Troops’ T-shirt around Mission Viejo, and I get smiles. In 1976, I wouldn’t have made it to the store.”

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New media outlets that appeal to gay readers are drawing advertisers who previously never ventured beyond the Yellow Pages.

Joyce Farmer, who has a 20-year-old bail bond business in Santa Ana, recently contracted for a small ad in the Blade, a Laguna Beach-based monthly magazine for homosexuals that distributes 20,000 copies a month.

She said the ad, which costs her about $86 an issue, affirms her personal sentiment.

“It’s important to me to be a bridge,” Farmer said. “People in the straight world ought to realize that gay people have a right to be gay.”

Also, she said, “I’m after the discretionary income.”

Farmer said she has advertised in the Blade since the magazine’s first issue in June, 1992. The ads bring her company name recognition in the gay community, she said, even if most customers still get her number from the Yellow Pages.

“We get a fair number of gays,” she said. “They know they’re in friendly territory.”

Estimates of the U.S. gay population vary widely. The Traditional Values Coalition in Anaheim, a conservative group, quotes a study saying that 1% of the population is gay. Leaders in the gay community cite a much higher 10% determined by another study. Those figures would indicate that Orange County has between 35,000 and 350,000 gay residents.

With an eye on that potential market, Elmore Toyota in Westminster in August began buying the highly visible back page of the Blade, which costs between $730 and $820 each month.

Gene Utterback, manager of the dealership’s fleet car division, said the appeal to gay consumers was inspired by the success of a similar strategy by a Toyota dealership in Los Angeles. Utterback said he doesn’t see advertising to gay consumers as a big deal--they are simply another niche market.

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An increase in local advertising to gay consumers, however, does not mean that Orange County has become an entirely comfortable place for gays to live.

Georgia Garrett-Norris, a Santa Ana lawyer, said she has been out of the closet since 1974. She still receives phone calls telling her that she is “sick” or “a degenerate,” she said, but “I suspect (Orange County) is infinitely better than Boise, Ida.”

Since she passed the California Bar exam in 1980, she has circulated her name in the gay community through advertising or personal referrals.

“When people come to me--when they want to leave their significant other their estate--they don’t want to be misunderstood,” she said. “We’re not that different. Just our orientation is different.”

Jeff Reid, a gay man who owns Reid Realty in Lake Forest, said it’s important in his business that clients feel he is on their side. That is especially true during the stressful escrow process, he said.

“When a real estate agent asks a gay couple why they’re sharing a checking account or who gets the master bedroom, it makes them stop and think about who they’re dealing with,” said Reid, who is a faithful Blade advertiser.

Reflecting shifting sentiment in Orange County, at least a third of the Blade’s advertisers are straight, Publisher Bill LaPointe said.

“That was never a source of revenue until about a year and a half ago,” he said. “I created this advertising base in Orange County.”

Before then, businesses that wanted to reach Orange County’s gay community typically did so by attending the Gay and Lesbian Pride Celebration, held every August since 1989. Founder and President Tom Heilman said he had a burst of interest for the 1993 festival from established real estate, financial services and insurance companies.

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As more people have gone public with their sexual orientation, the rest of the community has gradually become more aware of the potential of the gay market.

“A lot of advertisers, when they call, tell us they have a gay brother or sister,” said Beth Singer, a publisher of the Pink Pages. The 184-page directory draws about 25% of its advertising from the heterosexual community, she said.

As a business owner and as a lesbian, Singer said, she welcomes “gay-friendly” advertising. “A lot of people think, ‘Oh, you want to keep to yourselves,’ ” she said. “But we want to be part of the community, not separated.”

About half of Pink Pages advertisers tell her they have had gay customers for years, she said. The rest have a new interest in the market because the recession has made them eager to find new customers.

In other words, as MCA Inc. President Sid Sheinberg recently said, you can’t afford to be homophobic in a recession.

That sentiment draws a mixed response in the gay community.

“People are so desperate, they will market to their ‘enemies,’ is what we’re seeing,” said Jeff Yarbrough, editor-in-chief of the Advocate, a national gay newspaper based in Los Angeles. “I don’t know how invested they are in what we stand for.”

But Jeanne Cordova, another leader in the Southern California gay community, sees the trend in a more positive light. The publisher for 12 years of the Community Yellow Pages guide to gay businesses in greater Los Angeles, Cordova said the new openness toward gay consumers is a good thing, even if it is driven by economic necessity.

“We hope people are motivated by love and tolerance, but that’s not always possible,” she said. “Just about anything that makes straight people more open to gay people will do as a first step.”

Heterosexual advertisers in Los Angeles opened their arms to the gay market 15 or 20 years ago, observers say. In their eyes, Orange County is a laggard.

But that timetable is not unusual, said Andrew A. Isen, president of WinMark Concepts in Washington, which produces Direct Male, packets of advertisements sent to homes of gay men across the nation.

Discovery of gay consumers “is happening in third-tier metropolitan areas around the country,” Isen said. The trend began in Los Angeles and New York, spread to smaller cities such as Boston and the Twin Cities, and is now rippling out to such affluent suburban markets as Westchester County, N.Y.; Annapolis, Md.; and Santa Rosa.

“Orange County is catching up,” Isen said.

Gay Consumer Profile

The typical gay or lesbian consumer is educated and has spending money, according to researchers. Numbers are averages based on a sample size of 8,000; margin of error plus or minus 1%:

Category: Number/Percentage

* Years of education: 15.6 * Worked overtime in the past 30 days: 67% * Promoted at work in the past three years: 46% * Rented a car in the past three months: 24% * Purchased stocks or bonds in the past three years: 28% * Purchased investment property in the past three years: 7% * Taken a loan of under $5,000 in the past three years: 16% * Dined out in the past 30 days: 96% * Twice a week or more: 88% * Spent more than $100 in a night in the past 30 days: 39% * Three times or more: 13% * Purchased clothing in the past 30 days: 79% * Purchased record/CD/tape in the past 30 days: 61% * Three times or more: 24% * Purchased bottle of wine in the past 30 days: 46% * Entertained at home in the past 30 days: 63% * Purchased a car or truck in the past 30 days: 46% * Twice or more: 9%

Source: Overlooked Opinions Inc.