Called Dai-Biao, the Chinese word for "respect," the company is based around a web portal launched last week in Shanghai.
The site offers hip-hop music and video content sourced from Destroy Entertainment, Los Angeles, about music and adventure sports such as skateboarding. It also hosts a community area with user profiles where hip-hop fans can share their own music, photos and blog entries.
Dai-Biao's founders plan to eventually deliver content via mobile phones, 24-hour internet-based TV and radio channels, live events and venues such as upscale music clubs offering "the bling side of the Gen Y and Gen X lifestyle," said Chairman-CEO Mr. Kennedy, 39.
He and Mr. Werner, 49, president-creative director, both have backgrounds in entertainment and finance that have helped them commercialize every aspect of the company.
The venues and website will sell Dai-Biao-branded merchandise such as T-shirts, jackets, hats, accessories, jewelry and cellphones online and through the venues.
It's an ambitious plan that depends on revenue from advertisers who want to use the site and related services as a launch pad to connect with young Chinese in the top two dozen cities who are web-savvy, well-educated and eager to spend money on foreign brands. The digital portal and channels will carry advertising, and marketers can sponsor live events and promotions organized by Dai-Biao.
On the cusp
But the company's success also depends on the popularity of hip-hop, both the music and lifestyle, in China. Although relatively new in the mainland, the genre has taken off, particularly among Dai-Biao's target demographic, 15-to-25-year-old Chinese men and women.
"We're seeing a very real hip-hop culture developing in China, involving more and more kids, especially in the first- and second-tier cities," said Quinn Taw, Beijing-based executive director at China Media Exchange, a Publicis Groupe umbrella company for Zenith Media, Optimedia and Starcom. Dai-Biao "could be a good way to reach them at a grass-roots level, by building a lifestyle around a brand."
Mr. Taw's company is discussing opportunities with Dai-Biao for advertisers such as General Motors Corp.
PepsiCo is also looking at Dai-Biao. "They are rich in content, especially in the areas of cutting-edge sports and active lifestyle, which is something Gatorade sees potential to promote further in China, especially in tier-one cities," said Clarence Mak, PepsiCo's marketing director for Gatorade in Shanghai. Although the site's content still lacks "local relevancy at this point, [we] are exploring collaboration opportunities [and] will continue our dialogue."
China's government has cracked down on punk and rock music, but hip-hop is largely ignored, offering kids there a rare opportunity for self-expression.
Hip-hop is also extremely materialistic, said P.T. Black, a partner at Shanghai youth-trend consultancy Jigsaw. The genre's "obsession with luxury brands fits nicely with the relentless shopping and consumerism that is fueling the economy," he said. "There is a party atmosphere to a lot of popular hip-hop that matches these kids' material aspirations well. Plus, in the confusion of the English lyrics, they can pick out familiar brand names."
Even so, agencies and marketers have largely ignored urban music as a marketing gambit until now.
"Clearly there were big opportunities there, connecting brands with consumers through hip-hop. I didn't want to be on the sidelines, I wanted to be part of what was happening," Mr. Kennedy said.