As investors across the region look for niche markets to tap, one group famed for its high-spending lifestyle is attracting more entrepreneurs of all sizes throughout Asia including Thailand.
The gradual opening up of societies in generally conservative Southeast Asian countries has led to robust growth in businesses that cater to gay customers.
Many businesses might not think that it is a big market but Asia alone is estimated to have 200 million lesbian, gay, bisexual and transgender (LGBT) citizens who have combined purchasing power of about US$800 billion. The figure rivals that of the LGBT market in the United States, estimated at $790 billion last year by Witeck Communications.
Not all LGBT consumers are rich, of course, but those with the financial means tend to want the best quality they can afford, whether it’s monthly skin care from a dermatologist or designer fashion from cutting-edge boutiques.
In the consumer sphere these days you can find everything from art galleries that are promoted on gay community websites with discounts, to fitness centre branches favoured by gay customers, right down to underwear brands tailored to a gay clientele. And of course gay resorts, massage and sauna establishments are no longer “underground” but mainstream in many places.
Even some of Bangkok’s tallest high-end condominiums are quietly catering to this market of trend-setters, though it’s not something they advertise openly.
As in most developed countries, there has been a surge in the awareness of LGBT-friendly businesses in Asia and Asean, and this is evident from Hanoi to Bangkok and from Tokyo to Jakarta.
Taipei today is to Asia what San Francisco is to the United States, and cities such as Bangkok and Singapore are following closely behind.
Generally gay venues tend to be concentrated in certain areas within a city, be it around Bangkok’s Silom Road or Singapore’s “Pink Triangle” within Chinatown, lined with cafes, bars and clubs that draw LGBT crowds for the nightlife and lifestyle.
Many corporations are now openly coming out to support the community, as was evident at Pink Dot, the recent LGBT pride event held in Singapore. Barclays, Google and JP Morgan were among its corporate sponsors.
Ask anyone and they will say that gays and lesbians spend like there is no tomorrow, and in most cases it is true as few have the burden of raising children. Branded fashion, luxury goods and high-end wining and dining consume a lot of the money of this work-hard, play-hard group.
Ask Signapore bar owner Benjamin Ong. As the managing director of Does Your Mother Know, located in the city-state’s gay district, he has seen the increase of gay spending in recent years and sees the trend continuing into the future.
Is there an app for that? Indeed there is. In October last year, the Pink Dollar App for smartphones made its debut. It allows consumers to look up gay-friendly retailers, restaurants, bars or other venues, making targeted spending possible for anybody who wants to support those businesses.
Mr Ong says that while a smartphone app is a good idea, there is a whole world of everyday living, fitness, health and shopping for daily essentials where gay consumers can have an impact.
Advertisers who want to specifically reach LGBT consumers in Asia used to have few outlets, but in recent years gay-themed media, either print or online, have been expanding. Some are local editions of international titles, such as the recently launched Thai edition of UK-based Attitude, in print and online.
In Singapore, the heavier hand of censorship makes gay-oriented print publications illegal, but Element magazine was launched online (hosted on US-based servers) in April and is already starting to see some advertising revenues.
Hiro Mizuhara and Noel Ng, the magazine’s editors, want to inform their readers not only about lifestyle trends but other issues of importance to the LGBT community.
“Surveys have been done showing that the LGBT community tends to go for the brands that they know are gay-friendly,” said Mr Mizuhara. Businesses that openly support LGBT rights, especially in western countries, can see a difference on their bottom lines.
The trend is not as pronounced in Asia yet, he says, and in some countries such as Indonesia, a business might still risk a boycott of products or services if it openly embraced an LGBT cause.
For smaller businesses, being gay-friendly can pay rapid dividends.
“Gay people tend to be more aware of their appearance, do not have the burden of family and are more likely to spend on lifestyle products,” says Celeste Chong from the bespoke menswear firm Pimabs. “Hence it is a great move for us to step into the gay community.”
Someone who can afford a bespoke wardrobe might also be in a position to have a stylish residence at the Icon, one of the unofficially “gay” condominiums in Singapore (a Sathorn Road highrise is said to be the Bangkok counterpart).
Not surprisingly, the checkout at the 7-Eleven in the building offers grooming and body products exclusively for men instead of the normal mix of snacks and impulse items.
SAVING FOR THE FUTURE
Saving for the future is not something that many people associate with LGBT consumers, who are better known for spending. On the latter front, one of Thailand’s leading credit card issuers a few years ago issued a community-specific card.
However, a whole new area of growth has opened up for specialists that can offer financial management services tailored to special needs. One of them is LGBT Wealth, which started operating in Hong Kong in February this year.
“We are delighted to introduce a service for the LGBT community which we believe is underserved in financial advice,” said Howard Clark Burton, the CEO of Financial Partners, the regulated entity of LGBT Wealth.
“Very often, the legal protections for LGBT partners are not in place in Asia and we believe the correct advice can help LGBT individuals protect their wealth and their partners.”
More established companies as well as startups are taking steps toward addressing LGBT demand, apart from the already robustly growing pink tourism industry.
“In the long run Asia will be getting much more open,” explains Hiro Mizuhara of Element magazine.
“People are already becoming more understanding toward the LGBT community and that’s where the pink-dollar market comes in.”