Why Companies Are Focusing on LGBT Now and Rainbow Consumption

Why LGBT now?
Does LGBT require special consideration? What should be done and how?
How do companies that are doing well manage it?
What kind of people are LGBT individuals, anyway?

These are some of the questions frequently asked at Dentsu Inc. Diversity Lab (DDL).

LGBT is an acronym for Lesbian, Gay, Bisexual, and Transgender, representing one of the terms used to describe sexual minorities.

Many people likely feel that recently, they've been hearing about "LGBT" more often in various places, including the media. DDL, which provides corporate training and lectures on diversity, case studies demonstrating capabilities, and solutions like policies and ideas, has seen a surge in inquiries not only from media and local governments but also from diverse companies across all industries. This makes us keenly aware of the growing interest nationwide.

DDL's Gender Team LGBT Unit began its activities in 2012 and has continued to address these challenges. Starting today, our new series "LGBT JAPAN 2020: The Path to Becoming a Rainbow Company" will explore what it means for companies to engage with LGBT issues, dispelling common misconceptions while incorporating the latest information.

● Is the Era of Discrimination Ending!? The Global Transition in Approaching LGBT Issues

In Japan, the recent passage of the "Same-Sex Partnership Ordinance" in Shibuya Ward this past March remains fresh in our memories. Social movements surrounding LGBT issues have accelerated significantly over the last few years.

In June this year, the U.S. Supreme Court finally ruled to legalize same-sex marriage nationwide, sending news around the world (since U.S. state laws differ, some states previously allowed same-sex marriage while others did not; now, state laws prohibiting it are unconstitutional). It was such a historic event that many people around the world celebrated it. You probably saw how people, regardless of whether they were directly involved or not, changed their Facebook profile pictures to the six-color rainbow.

Another noteworthy development is the International Olympic Committee (IOC)'s September 2014 decision to add anti-discrimination clauses to its host city contracts. This means cities with discriminatory policies against LGBT individuals will no longer be eligible to host the Olympics.

This measure resulted from the IOC's concern over the 2013 Russian "law banning homosexual propaganda," which led to a boycott of the February 2014 Sochi Olympics opening ceremony by numerous world leaders. While this applies to the 2022 Winter Games and beyond, the Tokyo 2020 Olympics and Paralympics will also draw global attention to Japan's capabilities, including its products and services. This makes it an issue Japanese companies cannot ignore.

Celebrities have also been coming out in succession. In 2014, Apple CEO Tim Cook publicly announced he was gay, drawing significant attention.
As the first official coming out by a Fortune 500 CEO, this news not only gave courage to many but also showed that the tide is clearly turning, as it did not cause a drop in stock prices.

●One in 13 people in Japan identifies as LGBT, representing a market size of ¥5.9 trillion

A survey conducted by DDL this April targeting 69,989 people nationwide (aged 20-59) found that 7.6% of people in Japan identify as LGBT (equivalent to 1 in 13 people*). This percentage is said to be comparable to the proportion of left-handed people or those with AB blood type.

※DDL published data from a 2012 survey showing 5.2% (1 in 20), but due to changes in survey methodology, year-over-year comparison is not possible. The latest 2015 data provides a more accurate reflection of the current situation.

Over half (56.8%) of the LGBT population have never come out to anyone about their sexuality. Since sexuality isn't visible, this often leads to the misconception that "LGBT people don't exist around me." However, they are actually present in your immediate surroundings.

When considering LGBT, it's often helpful to think of sexuality as a combination of three elements: "the sex assigned at birth," "gender identity (whether one identifies as male or female)," and "the gender of one's romantic partners."

People who do not identify as LGBT, commonly referred to as "straight," are cisgender individuals whose biological sex aligns with their gender identity and who are heterosexual.

Beyond the sexualities depicted on the map, diverse sexualities exist that cannot be fully captured by the four LGBT categories. Examples include "intersex," where biological sex is difficult to classify as male or female, and "X-gender," where gender identity cannot be defined as strictly male or female.

Furthermore, a fourth category exists: "expressed gender," encompassing "transvestites" (cross-dressers), including figures like "drag queens." While considered one form of transgender identity, their cross-dressing often involves exaggerated, almost caricatured styles that typical women or men would not adopt. This differs somewhat from the desire for more natural, gender-conforming presentation felt by some transgender individuals, such as those with gender dysphoria.

The reason why people seen on TV, often referred to as "effeminate male celebrities," vary so much—some dress in a gender-nonconforming way, others don't; some wear extremely exaggerated cross-dressing, while others do it more naturally—is because the four genders within each individual differ. LGBT people cannot be lumped together, and whether someone is LGBT or not isn't always apparent from their appearance.

The age at which people realize they are LGBT also varies; 9.8% identify after turning 40.

It might be easier to understand sexuality as something ambiguous, like a gradient, rather than something that can be clearly defined as black or white.

Furthermore, the market size for the LGBT demographic has been calculated at 5.94 trillion yen. This scale rivals the annual total sales of department stores.

● How should companies engage with LGBT?

When companies engage with LGBT issues, two key perspectives come into play. One is the perspective of "employees" working for the company, and the other is the perspective of "consumers" who purchase the company's services or products.

Creating a workplace environment where LGBT individuals feel comfortable is becoming a critical challenge for companies seeking to secure talented personnel amid a declining population.

Surveys show that 74.6% of LGBT individuals respond that they "would like to work for a company that supports LGBT people." Conversely, this implies that being perceived as not LGBT-friendly could lead to losses, such as failing to hire talented individuals within the LGBT community or having them leave the company.

But how can companies accommodate LGBT individuals, whose needs are less visible compared to those of women or people with disabilities? As mentioned earlier, 60% of LGBT individuals have not come out, and they are particularly unlikely to disclose their identity at work. Consequently, companies often take no action, mistakenly believing "there are no LGBT people in our workplace."

When speaking with individuals working at companies that have advanced consideration, they often say, "It's an environment where I can work comfortably without coming out."

This means that even LGBT individuals who haven't come out can thrive without feeling pressured to conform. Such environments exist because systems are in place that provide rights and protections equivalent to those afforded to heterosexual married couples. Furthermore, a cultural understanding has permeated where phrases like "Do you have a boyfriend? Do you have a girlfriend?" are replaced with "Do you have a partner?"—a shift that everyone uses naturally. This fosters an environment where all employees can maximize their potential.

Interestingly, even among non-LGBT individuals, 64% expressed a desire to work for an LGBT-friendly company.

Being considerate of LGBT individuals demonstrates that a company is properly addressing "gender" issues, including the utilization of women, and also indicates it is addressing "disabilities" such as "gender identity disorder." This fosters an advanced image where the company seems easy to work for, even for those with other diverse minority attributes, ultimately leading to enhanced corporate value.

The Human Rights Campaign (HRC), America's largest LGBT rights organization, offers a free app-based "Buyer's Guide." This guide ranks companies based on surveys assessing whether their workplaces are LGBT-friendly, serving as one factor for consumers when making purchasing decisions. Notably, U.S. companies have already achieved near-perfect scores, and since 2016, the survey's scope has expanded globally beyond the U.S., generating significant attention.

● Rainbow Consumption: A New Consumer Trend in a Diverse Society

From the perspective of "buyers," the mainstream approach until a few years ago was to target the LGBT community as a dormant, massive market. DDL, however, identifies a new trend worth watching: a consumption pattern extending beyond LGBT individuals themselves to include the surrounding straight population centered around LGBT people. We research and position this as "Rainbow Consumption."

Rainbow Consumption can be broken down into three specific categories:

① Consumption by LGBT individuals themselves
②     Consumption supporting LGBT (including straight consumers)
③ New relationship-based consumption driven by LGBT acceptance in society (also related to same-sex partnership systems)

The first is the 5.9 trillion yen market representing the consumption power of LGBT individuals themselves.

The second, "LGBT-supportive consumption," refers to the tendency to support LGBT-friendly companies and initiatives. Surveys show that even among straight individuals outside the LGBT community, 52.7% expressed a desire to actively use products and services from LGBT-friendly companies. There are also corporate case studies demonstrating tangible results: during campaign periods where companies declared LGBT support, both store visits and sales increased.

When focusing on "the buyer," it's important to note that simply running outward-facing campaigns promoting LGBT friendliness isn't enough. The priority must be to first foster a friendly environment for LGBT employees within the company. By making internal policies and practices LGBT-friendly, everyone's awareness changes. This naturally creates an LGBT-friendly atmosphere within the company, enabling a friendly approach externally as well.

When designing products or services, it's also crucial not to limit the target audience solely to LGBT individuals. For example, products specifically marketed to gay men can make purchasing them feel like a form of coming out. Rather than singling out LGBT people, adopting an "inclusion" perspective—aiming to build a society where everyone, including LGBT individuals, can live comfortably—is vital.

"Diversity" refers to the state of having various people, while "inclusion" means harnessing that power positively for companies and society. Developing products and services with an inclusion perspective fosters empathy not only from LGBT individuals themselves but also from their supporters.

The third trend, "new relationship consumption," refers to spending patterns emerging as new family structures become accepted, such as through same-sex marriage. Examples include wedding ceremonies, purchasing a home or car together, spending on child-rearing expenses, and taking family vacations.

Furthermore, there's a noticeable trend of close friendships forming between power gay men and career women in their 30s and 40s. Even in opposite-sex pairings, consumption occurs between two people who are best friends rather than lovers.
Furthermore, consumption arises from the acceptance of diverse forms of love and the revitalization of romantic relationships.

● Whether a company understands minority perspectives can determine its fate

The world is shifting toward a diversity society where utilizing and accommodating diverse individualities (attributes and values) is the standard. The trend is toward diversity, with diverse cities and companies attracting people.

LGBT issues are said to encapsulate all elements of diversity: gender, gender identity "disorders," cultural differences, human rights, discrimination, entertainment, and more.
As we approach 2020, "diversity" will become an issue on par with "environment," and LGBT will likely become its flagship.

On a personal note, I myself have a severe hearing impairment. While "disability" can be difficult to relate to personally, "sexuality" is something everyone possesses, making it a theme easier to connect with. Precisely because of this, I feel hopeful about the potential for LGBT to serve as an accessible entry point for raising awareness about diversity among many people, becoming the catalyst for transforming society into a diverse one where everyone can live happily.

Next time, we'll dive into the front lines of companies actively engaging with LGBT issues!

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Survey Source: Dentsu Inc. Diversity Lab LGBT Survey 2015
Individuals aged 20-59 nationwide
SC Survey: 69,989 people
/ Main Survey: 900 people (LGBT group: 500 / General group: 400)
April 9-13, 2015 Internet survey

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● Dentsu Inc. Diversity Lab (DDL)

Based on the belief that "a diverse society that values the 'differences' between people—such as human rights, nationality, age, sex/gender, disability status, language, and cultural differences—leads to a 'rich future'," DDL is a solution lab formed by specialists from various fields within Dentsu Inc. and the Dentsu Group.
To realize a diverse and prosperous future, it focuses on four main themes—"Disability," "Gender," "Multicultural Coexistence," and "Generation"—providing companies and organizations with knowledge and concrete solutions related to diversity.
Contact:
URL: http://www.dentsu.co.jp/ddl/
E-mail: diversity@dentsu.co.jp

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●About the Diversity Web Magazine "cococolor"

cococolor is a web magazine operated by Dentsu Inc. Diversity Lab, founded on the belief that respecting people's differences as rich "individuality" is key to building a diverse society where everyone can live happily.
It covers themes related to human diversity from various perspectives—disability, gender, age, nationality, race, and more—aiming to make diversity feel more accessible and relatable.