Gay Papers Look to Turn ‘Pride’ Into Profits

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By: Mark Fitzgerald

For gay newspaper publishers, the good old days are now. “Compared to 23 years ago?” Publisher Tracy Baim says with a laugh, referring to the year the weekly Windy City Times was founded in Chicago. “I think it’s a great time to be in gay publishing. It’s so much easier than it was even 10 years ago to pitch to mainstream businesses.”

Indeed, according to the Gay Press Report, advertising spending in publications, about half of them weekly newspapers targeting the so-called GLBT (gay, lesbian, bisexual, and transgendered) audience, increased 205% between 1996 and 2006. Last year’s ad revenues of $223.3 million represented an increase of 5.2% over the year before ? a period during which print and online ad spending on daily newspapers was essentially flat.

In 1994, just 19 Fortune 500 brands advertised in the gay press. Last year, 183 did.

The recent performance of the gay papers is all the more remarkable because not so long ago, it appeared the stars were aligning against them. The Internet looked poised to steal whole categories of advertising, especially personals and other same-sex classifieds, and underfunded gay papers were slow to jump on the Web. Mainstream papers, which long shunned coverage of homosexuality or shrouded it in euphemism, were now providing forthright and faster news of gay-interest topics.

Ad spending in the gay press contracted 17.8% between 2002 and 2003 ? reflecting not only the post-9/11 doldrums but the fact that GLBT papers were being folded across the country.

“In this market, people did have a dollar and a dream,” says Todd Evans, president and CEO of Rivendell Media Inc., a gay media rep firm that produces the Gay Press Report with the ad agency Prime Access Inc. “You had a lot of people who were more about the cause than the business, and unfortunately you have to pay attention to business, too.”

But the shakeout left survivors stronger than ever, Evans contends. These days, he says, there are fewer startups ? but there are also fewer papers folding. Sue O’Connell, co-publisher of Bay Windows, a Boston weekly, says, “One of the practical reasons we are in great shape compared to mainstream media is that our profit margins are not as high as the dailies ? so we’ve been living in the real world all along.”

Gay papers have always had to be nimble, adjusting as ad categories bubble up and burst. A couple of decades ago, for example, gay newspapers made tons of money from so-called “viatical” ads, offers to buy up the life insurance policies of people with HIV or AIDS. That category collapsed as new drug cocktails extended longevity.

Bay Windows is a good example of how gay papers manage in continual booms and busts.

When Massachusetts legalized same-sex marriage, Bay Windows took in some $200,000 in wedding-related advertising in just one year. When that boom faded after same-sex weddings were restricted to Massachusetts residents only, it was replaced by a surge in real estate advertising. “There’s always some influx of local dollars,” says O’Connell, who also is the current president of the National Gay Newspaper Guild, an association of a dozen of the biggest audited papers.

Gay papers report they are doing well in ad categories that have collapsed at mainstream dailies, such as real estate and automotive. Consider Between The Lines, a Detroit-based weekly that circulates throughout southeast Michigan, an area that has been thrown into recession by the auto industry’s woes. Co-Publisher Jan Stevenson says automotive is actually one of the paper’s better categories.

“Auto dealers are really trying to keep their sales up with smaller ad budgets, so they’re saying, ‘Where can I use my money to look really good?'” she says. “And they find it’s not really very expensive to hit us as a market.”

And one big selling point for gay papers, publishers say, is that their audience is incredibly loyal to retailers and brands that advertise in gay media. When Rivendell did the first study of gay readers in 1984, an astounding 98% of respondents said they would go out of their way to buy the products or services of advertisers in gay media ? and would even pay more for them. Those loyalty levels remain at the 90% level even now, Rivendell’s Evans says.

“That’s a cache that no other niche publication can claim,” says Bay Windows’ O’Connell.

In Texas, Dallas Voice is growing because Dallas is growing ? “You can’t fight macroeconomics,” Publisher Robert Moore laughs ? and because the city itself is gay-friendly. But the paper has also learned to navigate the turning tides of newspaper economics, he adds: “There’s been a pattern over our 23 years. Every three or four years, we have a very substantial spike, and our goal is to hold on to that, to keep it at least flat.”

So far, so good: Display ads jumped 20% last year over 2005. National, which only amounts to about 8% of revenue, is nevertheless up 50% year-over-year. Web income is up another 20%, and its traffic is up 50% since January.

Dallas Voice partners with a gay-oriented satellite radio channel and news service but also is a member of the city’s convention bureau, Better Business Association, and Dallas Ad League. “We’ve tried to integrate ourselves into what we regard as the really strong strategic institutions,” says Moore.

Growing acceptance of gays and lesbians in America has both eased and complicated the gay newspaper business, publishers say. On the one hand, it’s easier to distribute gay papers in places that once would be unlikely venues. For instance, Out & About, Nashville’s principal gay paper, can now be picked up at Kroger’s supermarkets. On the other hand, publishers must deal with what they call “gay sprawl,” the migration of their readers from urban neighborhoods like Chicago’s Boys Town to distant suburbs.

“The challenge is to find gay people, because we’ve spread out,” says Bob Witeck, CEO of Witeck-Combs Communications Inc., a Washington, D.C.-based firm specializing in marketing to the gay and lesbian market.

Gay papers are also adjusting to the competition from mainstream dailies covering news of interest to the GLBT community. Some papers offer more coverage, in greater detail. Bay Windows, for instance, dispatched two reporters, one blogging live, to the state constitutional convention that put off abolishing same-sex marriage.

Others, such as Chicago’s Windy City Times and Between The Lines in Detroit, now emphasize their arts coverage. “As the dailies have laid off arts people, we’ve become known as the best paper for covering arts,” says Jan Stevenson, Between The Lines’ co-publisher. One result: The paper now has more straight readers.

In the annual advertising and circulation cycle the best season is known simply as “Pride.” It comes every June when gay communities celebrate Gay Pride Month with parades and festivals. “Pride is our Christmas,” says Stevenson.

But this year’s Pride came up a little short for gay publishers. Preliminary results from several markets show a fall-off in national advertising that may presage a tougher competition in the long term to keep the category in print. In Detroit, for instance, Between The Lines saw “a big drop-off” in national, Stevenson says. Overall Pride revenues were actually up because of stronger buys by local and regional advertisers, she adds.

That’s how it went in Boston, too, says O’Connell. Local ads at Bay Windows were up, but national ads, which the paper looks at as gravy that cannot necessarily be counted upon, were down.

“National companies understand they can reach gay consumers in a number of ways now, and one is by sponsoring events,” she says. “So while spending by national companies to reach the gay audience is up, we’re sharing that with more businesses.”

Evans of Rivendell Media says he is hearing from gay papers around the nation that revenues during the 2007 Pride season lagged behind past years.

Still, the overall outlook remains positive. Once-hot niches such as Spanish-language newspapers have slowed, but Evans doesn’t see that happening to gay papers for a while. For one thing, he notes, competing media such as radio and broadcast have not emerged in any strong way as they have for Spanish-language speakers.

Besides, he says, gay papers will always have something unique to offer their audiences: “The one thing in this market is, you have to know where to go on Friday night.”

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