Monday, September 06, 2010

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music, marketing, and money!
Source: Reuters/Billboard
Author: Reuters/Billboard

Hip-hop culture is saturating the mainstream through music and marketing.

Companies have awakened to the genre's selling power, and as rap stars pitch soft drinks, athletic shoes, apparel, automobiles and beer, cross-promotions are born almost daily.

"Companies are just realizing because it is contributing to their bottom line in a major way," says Jameel Spencer, chief marketing officer of Bad Boy Entertainment.

Spencer, who is also president of independent agency Blue Flame Marketing and Advertising, says cross-promotions are "coming from as small a relationship as a product mention in a song to something revolutionary like Jay-Z owning a sneaker with Reebok."

Corporations "finally realized the power of hip-hop music on the community and the world," rapper/actor Ludacris says. "It's done nothing but get bigger and expand to become the popular music of today."

But hip-hop has been serving unofficial product pitches since Run-D.M.C. praised "My Adidas" in 1986.

"Long before corporate America started cashing in and understanding the power of the hip-hop voice, you had a person like Biggie or Lil' Kim screaming out all these designer labels," says Shawn Prez, CEO of New York-based guerrilla marketing firm Power Moves and a former Bad Boy executive.

"This hip-hop voice -- it's loud, it's results-oriented," he adds.

Entrepreneur Russell Simmons spearheaded hip-hop culture's move to the mainstream with Def Jam Records in the '80s.

Since then, he has expanded his business into management, marketing, apparel, theater, TV, jewelry and financial services. In February, Simmons sold his Phat Fashions empire to apparel giant Kellwood for $140 million.

Bad Boy Records founder Sean "P. Diddy" Combs' apparel line, Sean John, is also growing. The 6-year-old, multimillion-dollar company will open its first free-standing store in June.

Jay-Z and his Roc-a-Fella Records partner Damon Dash spun off their own clothing company in 1999. Rocawear raked in about $300 million last year, according to Dash.

The S. Carter Collection, Jay-Z's joint venture with Reebok, set the industry abuzz by becoming the sneaker company's fastest seller.

Jay-Z and Dash also purchased Armadale Vodka.

Marketing experts agree that Simmons, Combs, Jay-Z and Dash have shown corporate America that hip-hop can generate dollars outside the music business.

Hip-hop stars define what's cool for fans, naming such brands as Cristal, Gucci, Cadillac and Hennessey in lyrics and liner notes and showcasing those brands in videos.

Simmons says that when a person comes out of poverty, "you know what the American dream has to offer, because you study it. So they're very good at picking luxury and mainstream products, because they study it and they love it. They're excited about it."

That excitement generates sales. Some 45.3 million consumers worldwide spend $12.6 billion annually on hip-hop media and merchandise, according to Simmons Lathan Media Group, the media-content company Simmons co-owns.

Once dismissed as having limited mainstream appeal and buying power, hip-hop is now the hottest selling tool in the Madison Avenue arsenal.

LL Cool J, Eve, Missy Elliott, G-Unit, Ludacris, Baby, Nelly, Baby Bash and Funkmaster Flex are just some of the acts connected to a variety of products.

Why has the trend suddenly exploded? Because rap's appeal is now universal.

"Hip-hop is not a side category anymore," notes Ayiko Broyard, a marketing executive who helped Reebok create tie-ins with 50 Cent, Mary J. Blige (news) and OutKast's Big Boi. "There used to be a strong line -- if you were a hip-hopper, you didn't listen to Kid Rock and you didn't skateboard. There are no lines anymore."

Prez agrees. "I don't care if you're Asian, I don't care if you're of European descent. The same kids that are listening to Korn or Fred Durst will go and pick up the new Snoop Dogg or 50 Cent CD. This is the hip new thing, this hip-hop culture."

And that culture has seeped into suburban enclaves and corporate offices, says Morris L. Reid, CEO of Washington, D.C.-based Blue Fusion, a youth marketing agency.

"There's nothing going on in hip-hop today that wasn't going on when Russell Simmons and Rick Rubin and the pioneers kicked the doors down," Reid says. "The difference is, the CEOs and senior execs are going home and seeing all this hip-hop culture happening in their own community. And they're getting comfortable with it."