As organisations shift their marketing focus to the LGBTI customer segment – commonly referred to as the ‘pink dollar’ – are there misconceptions as to what makes these customers choose particular goods and services? This case study investigates whether there are significant misperceptions between what hoteliers perceive gay guests deem to be important attributes when selecting a hotel. The prevalence of marketing focusing on different, and more specific, segments of the customer market is increasing. In the past 10 years mainstream organisations have identified the Lesbian, Gay, Bisexual, Transgender, Intersex (LGBTI) market as a new business opportunity. According to the Pink Media Group (a Sydney-based business that aims to connect brands with the ‘pink dollar’ via advertising) the gay market consists of “2.2 million people, with an annual disposable income of $20 billion”. Further, this market segment is “more inclined to spend on luxury goods, travel, technology and fashion”. So, if businesses are shifting their marketing attention to this particular market segment, are they set up for success? Do they know what it is that LGBTI consumers actually desire when choosing goods and services, or are their decisions based on stereotypes and assumptions? A recent study on LGBTI hotel guests sheds light on this question. This study contrasts the actual buying choices of LGBTI guests with the assumptions made by hoteliers about LGBTI accommodation and service preferences. Conducted by Assistant Professor Orie Berezan (California State University) and Associate Professors Carola Raab, Anjala Krishen and Curtis Love (University of Nevada) the study found that hoteliers held several misconceptions about their gay guests, and that social environment factors (not based on sexual orientation) had the greatest impact on whether guests in this segment of the market were loyal to a specific hotel. Aim: The aim of the research was to identify whether the accommodation preferences of LGBTI guests and assumptions by hotelier, and therefore marketing focus, were aligned. In essence, to identify what drives LGBTI guests when selecting a hotel and what makes them loyal as hotel customers. Method: Two key questions formed the basis of the study: Do hoteliers know what is important to gay guests when selecting a hotel: i.e. property attributes, hotel reputation in the gay community, and corporate social responsibility initiatives? With regard to gay guests, which factors have the most significant impact on loyalty behaviour? The study surveyed 48 hoteliers (Group A) and 188 gay male guests (Group B) who stay in hotels – mainly for leisure travel. The researchers decided to focus on gay males rather than the broader LGBTI customer segment in order to avoid the influence of non-related factors such as gender. Each participant from both Group A and B was asked to complete an online survey that included a list of 53 attributes describing key features related to a hotel stay. The 53 attributes were broken up into three key categories: property attributes, hotel reputation in the gay community and corporate social responsibility. Property attributes encompassed in-hotel dining and bars, laundry service, customer loyalty programs, and quiet soundproofed rooms. Hotel reputation in the gay community included the hotel’s support of the gay community, the hotel’s affiliation with gay travel organisations, and hotel advertisements in gay print or internet media. Corporate social responsibility outlined the hotel’s employee rights and environmental record. Group A, the hoteliers, were asked to rank the 53 attributes on a scale from 1 to 7 (1 = strongly disagree; 7 = strongly agree), to understand how important they believed each attribute was in motivating a gay male guest to choose their hotel. Group B, the guests, were asked to rank the same hotel attributes (using the 7 point scale) but were asked how important each feature was in their decision to select a hotel. Findings: The results from this study show a significant gap between hoteliers and gay guests and the factors that influence gay males in selecting hotels. 1. Hotelier’s knowledge. The researchers found that the hoteliers and the gay guests differed significantly in their perception about the relevance of buying factors on half (22) of the 53 attributes. Key differences between hoteliers and guests included: Hoteliers perceived “anonymity when checking in” as an important attribute, that could drive guests away if anonymity was not respected. However, gay guests did not rate this was as important when choosing a hotel. Hoteliers believed the availability of a gym, in-hotel dining, and in-hotel bars were important attributes when choosing a hotel. Gay guests, however, did not indicate that these features would attract them to select a specific hotel over another. Hoteliers perceived customer loyalty programs to be significantly more important than gay guests. Hoteliers believed that decoration was an important variable when choosing a hotel; however, gay guests were neutral to this attribute. Hoteliers rated attributes such as hotel advertising in gay print or internet media, the hotel’s record of supporting the gay community, and affiliation with gay travel organisations as important selection criteria; however gay guests do not rate these variables as high. Rather gay guests consider referrals from other customers as more important than than efforts to support the gay community. In contrast to hoteliers, a hotel’s employee rights record and its environmental record were deemed less important by gay guests. No significant differences were detected in the ratings for the following variables: safety, entrance security, cleanliness, comfort, extended breakfast hours, free internet, price, and gay concierge. 2. Factors positively influencing the buying preferences of gay guests. The researchers found that the two most important features for guests when selecting a hotel were: quiet/soundproofed rooms and value for money. Implications: The specific findings of this study suggest that US hoteliers carry misconceptions as to the factors influencing gay guests buying decisions when selecting hotels. This has significant implications for hoteliers’ marketing efforts given the likely misdirection of time and money – focusing on attributes that don’t garner the interest of gay customers. Extrapolating from this study, organisations might wonder whether their efforts to engage the broader LGBTI community are also based on misperceptions and are therefore less than optimally effective. One might readily assume that in view of the lack of detailed information about LGBTI buying preferences, stereotypes and assumptions are having a dominant influence on marketing campaigns and approaches. Having said that, drawing broader implications from this study should be done with care given the study’s small sample size, and narrow focus of gay men. To read the full article, see Berezan O., Raab C., Krishen A., Love C. (2015) Loyalty Runs Deeper Than Thread Count: An Exploratory Study of Gay Guest Preferences and Hotelier Perceptions Journal of Travel & Tourism Marketing Vol (32). Accessible here.