Although gay culture has increasingly become part of the mainstream, with many more openly gay celebrities and gay themes and characters featuring regularly in television dramas and comedies, it is still very difficult to estimate the size of the gay population in the UK. Mintel (2006), for example, suggests that 2–3 per cent of the UK population is gay, while Stonewall (2010) suggests that it is over 6 per cent.
As Norman (2010) points out, however, people (particularly those from the lower socioeconomic groups)
are still very shy of discussing their sexuality with researchers, which makes it extremely difficult to get an accurate picture.
There is some consensus on the characteristics of the gay market, however. Gay consumers are perceived to have a higher than average income of over £31,000, and are more likely to live in urban areas.
Estimates of their spending power also vary, but the ‘pink pound’ is estimated to be worth over £80 billion (Stonewall, 2010). Those who are cohabiting are likely to be in dual-income households, and are less likely to have dependants. This gives gay consumers more opportunities for lifestyle spending with a strong focus on leisure and socialising, with significant spending on holidays (£3 billion), clothes (£1.9 billion) and CDs/DVDs (£1.6 billion) (Management Today, 2008).
There is plenty of opportunity for reaching the gay market. New Media Age (2009) reported that 93 per cent of gays use the internet every day, a much higher proportion than the national average. Research has also indicated that they spend up to ten times longer online than the average internet user, are more likely to buy the latest gadgets and are particularly appreciative of those organisations that reach out to communicate with them. The internet is important, in that it allows gay people to build a stronger sense of community and it gives marketers a chance to locate and target the gay market efficiently and discreetly. The average household income of the gay internet user is £38,000 (New Media Age, 2009), and there are, of course, many websites set up specifically for online gays, attracting mainstream advertisers, such as British Airways, Vodafone and American Express, as well as companies specifically targeting the gay community.
In the travel market the openly gay segment is only a small proportion of the market. Mintel (2006)
found that there were 1.25 million overseas holidays taken by gay people in 2006 but only a small proportion of those were booked with gay-specific travel suppliers or to ‘gay destinations’. As society’s attitudes continue to become more relaxed, Mintel expects there to be increasingly less demand for gay tourism as a sector in its own right. The preferred holiday activities for gay consumers, and the benefits sought are much the same as anybody else’s: relaxation, sightseeing, relaxing on a beach, eating and drinking. Nevertheless, tour operators are still acutely aware of the needs of gay holidaymakers. Thomson holidays, for example, has its Thomson Freedom brochure which features gay-friendly resorts, and accommodation that is GayComfort certified (with a few hotels that are exclusively gay) so that gay couples can be sure that hotel staff have been properly trained in dealing with gay guests and there will be no awkward or embarrassing moments. The brochure also features package holidays to gay festivals and civil ceremony packages (www.thomson.co.uk/
brochures/freedom.html).
Thomson has a point here – even if a gay couple is not looking for an explicitly gay holiday, they still want the reassurance that they will be welcome at the resort and the hotel they choose to go to. The tourism authority in Kraków, Poland wanted to target gay tourists, but this caused widespread concern among Catholic associations – a vociferous force to be reckoned with in Poland. One is reported to have said, ‘we don’t want drunken Britons getting their genitals out in public, but we don’t want gays performing public obscenities either’ (as quoted by Davies, 2008). Even the word ‘gay’ had to be dropped from the tourism literature.
However, business interests are fighting back with hotels, pub and club owners broadening their offers with special online sections promoting gay tourism and pursuing that lucrative pink pound. Compared with stag-nighters from the UK who ‘pack themselves into the car, vomit out of the windows, and run off without paying’, according to one taxi driver, the gay community is much more refined (Davies, 2008). For those gay travellers looking for something a little more active, Neilson Adventures is offering a range of adventure holidays, called ‘Out’, to destinations such as the Himalayas and Peru. All the elements of the trips have been carefully chosen or designed to be gay-friendly (Travel Trade Gazette, 2011).

Questions 

1 To what extent does the gay segment conform to the criteria for successful segmentation?
2 What segmentation bases are relevant to the gay holiday market?
3 What are the risks and rewards for a mainstream company targeting the gay segment?