The LGBT “Trickle-Up” Theory

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It is argued that “trickle-down economics” and the “trickle-down theory” don’t always work as planned. By conducting a survey of over 1,400 LGBT business decision makers, Community Marketing, Inc. (CMI) and the National Gay & Lesbian Chamber of Commerce (NGLCC) prove a new theory, appropriately named “The Trickle-Up Theory.”

This study provides concrete evidence that a company’s LGBT friendliness with regards to purchasing choices directly correlates to decisions made by LGBT business makers. The study states that nearly four out of five people surveyed report that their purchase decisions are influenced by a supplier being LGBT-friendly and LGBT-owned. So how does this Trickle-Up Theory look in action? Thomas Roth, president of CMI, explains, “Gays and lesbians who make purchasing decisions for their employer often refer to their ‘consumer’ loyalties–whether it’s their favorite gay-friendly airline, financial company, or some other business—when making those choices at work. We call this the ‘trickle-up’ or multiplier effect, where a lesbian consumer might choose a gay-friendly hotel for her personal stays, but also could make a booking for 100 rooms at a similarly known gay-friendly hotel for a company meeting, because of that same loyalty.”

Prior to this study, commerce between LGBT companies has never been calculated or studied. The goal of this study is to put a numeric value on the purchasing habits, motivations, and behaviors of companies, documenting how LGBT corporations connect to each other. The “Trickle-Up Theory” proves the mutual benefits of these endeavors.

The cause and effect nature of the “Trickle-Up Theory” is astounding. About 78% of those surveyed acknowledge that if a company is LGBT-owned or recognized as LGBT-friendly, this influences their choice to use that company’s products or services. This argument is specifically important to dot429, as we are striving to build the LGBT business community through networking online and off. Evidence proves that by supporting the products of LGBT-owned and LGBT-friendly businesses, your money goes to work for other LGBT companies as well.

This ground-breaking survey demonstrates how important organizations like the NGLCC are to LGBT business owners, contributing to the growth of their businesses. The NGLCC represents over 1.4 million LGBT-owned businesses in the United States. Affiliated members give preference to LGBT-owned and friendly business while remaining firm in their attitude to cease business transactions with companies deemed LGBT-unfriendly. While finding LGBT suppliers used to be difficult to identify, the NGLCC makes this information accessible for business-to-business commerce.

Within the survey, 76% of people admitted they were likely to stop supporting companies that were anti-LGBT or otherwise not supportive of the LGBT community. This, in turn, amplifies the consequences of the “Trickle-Up Theory.” Today’s consumers have options when it comes to almost every decision. With companies fighting to stay ahead of the curve and the competition, this is a call to action for all companies to stay conscientious of their behaviors and attitudes, especially in respect to LGBT consumers.

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