Called Dai-Biao, the Chinese word for “respect,” a hip-hop slang term that means standing up for family and values, the company is based around a web portal, www.dai-biao.com, that launched in Shanghai on July 23. Its target demographic--15-25 year-old Chinese--are internet-savvy, affluent, lifestyle-oriented and educated.
The site offers audio and video content sourced from L.A.-based Destroy Entertainment about hip-hop and other types of urban music as well as adventure sports like skateboarding. Dai-Biao plans to shoot local concerts, car shows, club venues, outdoor events and fashion centers across China to localize the site.
The portal also hosts a community area with user profiles, where hip-hop fans can share their own music, photos and blog entries, filling a gap in the market left by mainstream portals such as Baidu.com and Tom Online and global music brands like MTV.
Dai-Biao’s founders eventually plan to deliver content via mobile phones using WAP technology, 24-hour internet-based television and radio channels. Dai-Biao TV, a 24-hour channel with one male and one female host, will launch later this year via PPLive, a Chinese peer-to-peer streaming video network.
They are also organizing live events and establishing permanent venues such as upscale music clubs offering “the bling side” of the GenY lifestyle,” said Mr. Kennedy, Dai-Biao’s 39-year-old chairman and CEO.
He and Mr. Werner, 49, president-creative director, both have a background in entertainment and finance that has helped them commercialize every aspect of the company. The venues and web site will sell Dai-Biao-branded merchandise like T-shirts, jackets, hats, accessories, jewelry and cell phones online and through the venues.
Before relocating to Shanghai Mr. Kennedy founded Ubiquitous Entertainment, a hip-hop label in L.A. providing film soundtracks. It works with music companies and studios such as Warner Music, Sony BMG, Virgin Records, Universal Records and Miramax. Before that, he founded Pioneer Financial Group, which managed private client assets and held an investment position at PaineWebber.
Mr. Werner worked in merchandise business development at U.S. entertainment venues, including Detroit’s Motor club, following investment positions at Dean Witter and Bear Stearns. He also owns the trademark logo for Motor and Dai-Biao plans to open a Shanghai club under that name this fall. Two other venues are planned for Shanghai, an upscale club/lounge called Mélange and Panache restaurant.
“At this time there are relatively few clubs in Shanghai as well as the whole of China which are devoted exclusively to the emerging hip-hop and ‘mash’ market,” said Mr. Kennedy. Motor Shanghai will be the first club that embraces this new ‘cultural revolution’ that is driving the Chinese GenY demographic.”
They have developed an ambitious business model that largely depends on revenue from advertisers that want to use the site and related services as a launch pad to connect with young consumers in China’s two-dozen largest cities, who are web-savvy, 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.
But the company’s success also depends on the popularity of hip-hop, the music and lifestyle, which isn’t a risky proposition these days. Although it’s a relatively new phenomenon in China, the genre has taken off.
“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.”
PepsiCo is also looking at Dai-Biao. “They are rich in content, especially in the areas of edgy, cutting-edge sports and active lifestyle, which is something Gatorade see 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.
It appeals to “a young generation of single children who are charting unknown territory,” said P.T. Black, a partner at Jigsaw youth consultancy in Shanghai. “These kids are daily faced with things their parents and teachers know nothing about, and the confidence and swagger of hip-hop is something they can adopt to show that they are in control. They need that confidence.”
Hip-hop is also “extremely materialistic," added Mr. Black. Its “obsession with luxury brands fits nicely with the relentless shopping and consumerism that is fueling the economy. 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.”
Chinese rappers have discovered its staccato cadences can be translated into local dialects.
“Funnily enough, hip-hop works in Mandarin," said Mr. Taw. "There is already a tradition out here in the northern provinces, in terms of word play and rhythm. Kids participate because skateboards and BMX bikes are portable and cheap compared to cars and ski packages and the lifestyle offers good-looking clothes and girls."
Even so, agencies and marketers have largely ignored urban music as a marketing gambit until now.
"Clearly there were big opportunities 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,” said Mr. Kennedy.
He conceived the idea for Dai-Biao three years ago, when the Los Angeles-based music producer came to a startling conclusion: China was home to millions of hip-hop fans, Shanghai was building the world's largest skateboarding park and kids were starting to publish their own music online just for fun.
While Chinese teens had clearly adopted hip-hop, both the music and the lifestyle, and were willing to invest in the tunes, fashion and activities, agencies and marketers had not.
“Agencies don’t understand the hip-hop lifestyle enough to be able to help multinationals exploit the opportunities. But we’ve lived the lifestyle and we do understand it."
Dai-Biao’s founders have mapped out an ambitious business model in China, a country known for rampant internet piracy and media censorship and the site’s early programming has little local content. Will it survive?
“Whether or not they will be successful is a question. But there is a lot of room to grow. No one has touched on good youth marketing in China, we haven't scratched the surface yet,” said Mr. Taw. "I’m rooting for them, because there is so much sameness around youth marketing in China. It’s mostly about dumb pop music that’s quite vapid. X-games and hip-hop are keeping things real.”