Gay Phoenix Forum: Day One & Two

TEMPE, Ariz. — The Gay Phoenix Forum kicked off with a bang at the XBIZ welcoming party on Wednesday night with the unveiling of "Chi Chi LaRue" and "Michael Lucas" - the promotional standees that promote the new GLBT tab.

Guests had the privilege of getting their photos taken with their favorite director as Kiss' "Rock and Roll All Night" blared.

Appearing at the party were Brett Drysdale from Fleshlight, Morgan Sommer of Cybersocket, NakedSword's Tim Valenti, Lavender Lounge's Mark Kliem, MarineMeat's Gunny, Ken Furtado of X-Factor, Jody Burman from Bel Ami, GAYVN's Harker Jones and many other GLBT luminaries.

Thursday afternoon seminars included "Gay is Not a Niche," a seminar geared toward informing non-gay businesses how to crossover into the lucrative gay market.

Unfortunately, the only ones in attendance were members of the gay industry.

Moderated by Mary G. of FlashCash, members of the panel included Harlan Yaffe (PrideBucks), Rainey Stricklin (Traffic Dude) and Kristin W (YappoDollars).

Since no straight companies were represented in the audience, the panel focused on how the two markets were different .

"On the straight side, glamor photos of models are accepted," Stricklin said. "However, the gay market is more interested in the hardcore stuff. They don't need to step into 'erotica' before they get what they want. They know what they want."

Yaffe agreed. "Straight companies tend to live by what I call 'The Rooster Theory.' Any cock'll do. But a gay consumer won't buy it. They don't want the tease anymore."

The panel agreed that gay consumers are fiercely loyal.

NakedSword's Tim Valenti said, "I've had rebills going back 10 years, back when we started NakedSword."

"I actually got into this business to pay for my NakedSword membership," Yaffe joked. "But it's true - once you get a gay customer, you have them forever."

"Provided you have good customer service," Valenti said. "When a customer calls in, we log the conversation so we have a good understanding of the make up of our customers."

"You need to talk to your members," Stricklin said. "The best way to tell how your content is working is to give those customers the chance to interact with their investment. Get their feedback, put in a rating system - find out what's working for them and what is not."

"Many straight companies want to start up gay sites," Mary G. said, "but they won't know anything other than the fact that they want to start up a gay site. These companies need to invest n someone who lives and breathes the gay market. Many of these companies don't understand that you can't just 'start up' a gay site. They need to do their research."

"The common misconception is that gay is a niche," Stricklin said. "But just as the straight companies have big boobs and Latina and hairy girls, gay companies have military guys or college guys or bears. Gay is not a niche - it is a market filled with niches."

Talk turned to the importance of Tube sites in finding niches.

"These sites are good in that they give consumers enough to get it up but not enough to get off," Yaffe said.

People who are looking for a particular niche - no matter how out of the ordinary it may seem - will most likely find them on a Tube site.

Discussion then turned to niches in general. One audience member explained that he had a Marine site - but it was simply a couple of Marines sitting around drinking beer and "chillin' with their buddies."

"I have to stop these guys from masturbating, believe it or not," he said. "A lot of people complained when the guys would jerk off because it ruined the fantasy for them."

"We're not selling product," Yaffe said. "We're selling fantasy."

In the end, the panel agreed that straight content producers wishing to break into the gay market needed to do their homework.

"Gay Business 101" was moderated by Andy Kiefer of CCBill and on its panel were Luke Hubert, founder of ChiliHost; Hot House Entertainment's Brent Smith; and former pornography lawyer Chad Belville, currently with

The first question posed was, "What are the unique challenges in starting up a company in the adult industry?"

"The gay porn surfer is very fussy," Hubert said. "You need to find something that will make them happy."

"If you want to be a pornographer," Smith said, "that's not what it's about anymore. Anyone can buy a camcorder and shoot a movie. Anyone can edit on Final Cut Pro. You have to focus on the technology and partner up with someone for Web help."

"From a legal standpoint," Belville said, "there's no difference between straight and gay. Even though it's easy to get into, it's hard to get into it with any depth. It must be organized as a business.

"Write down what your responsibilities are," he said. "If your foundation is weak, your business will suffer. The best investment you can ever have is hiring a bookkeeper. Al Capone killed many people but it was an accountant who took him down."

Talk turned to what kind of corporation one should use when starting up.

"The easiest way to go is with an LLC," Belville said. "The C-corp is taxed at a business level, whereas an LLC is a hybrid of tax benefits. I recommend this to 98-percent of people I talk to. Make sure, though, that you create the LLC in the state you live in.

"As for an S-corp, it's a fine line to travel between it and an LLC," he said. "An S-corp is more of a corporation but an LLC is more of a partnership."

Hubert answered a question from the audience. "Should I start up a pay website or start up a company," the audience member asked.

"Don’t start a paysite," Hubert said. "You'll spend a lot of money and it's a long payoff. Learn how to generate traffic and the best ways to filter or purchase more traffic. You must understand the business behind what you are trying to do."

"Have your brand clearly established," Smith said. "Differentiate your product from the glut of product already on the market. It's getting harder and harder to stay unique so do an analysis of the market. Find out what is and is not being represented. But then you have a choice: Do you choose what you love to do or choose what will make you money?

"Watch what the competition is doing," he continued.

The topic of branding came up and Smith said, "Branding is misunderstood. It's not just slapping on a logo. You have to brand personality traits, create a tagline. All this falls into place after you've done your groundwork."

A question was raised from the audience. "DVDs vs. websites. Should I stop distributing DVDs and focus on the website?"

Smith: "Revenue is revenue. On the Hot House site we offer member pricing for our customers. It makes it more palatable. A lot of people will pay $69 for a DVD - we try to soften that blow by reducing prices for members of our site."

Hubert agreed. "DVDs are a good cross sell," he said.

Traffic leaks were brought up. "A traffic leak is when an affiliate sends a consumer a click that takes them to a different site," Kiefer said, "and then that affiliate doesn't get credit. It's a technology issue that needs to be solved."

Smith made a suggestion. "You have to ask yourself if you would you join your own site? Does it turn you on enough? If you're having some problems with traffic, test your waters. Just as in the real estate world it's all about 'location, location, location,' the marketing world is 'testing, testing, testing.' Hire someone on if your site is not your cup of tea."

"Always ask someone else to look at your site," Hot House founder Steven Scarborough said. "Sometimes we're too close to it. We understand our own product, but you have to let another pair of eyes check out what you're doing. Can they follow what you're trying to do? Never be afraid to ask for help - and don't be afraid of change."

As the session ended, Belville brought up the topic of model releases and photographer releases.

"It should be clear who owns the content," he said. "Write it down, make sure you - and if you have a partner, your partner - know that if anything happens, who owns your stuff."

The evening ended with a kickoff party sponsored by Cybersocket and an after-hours party in the Gay Latenight Suite that was sponsored by PrideBucks and Mansites.