In an attempt to further leverage its diverse artist roster, Island Def Jam Music Group is in formal talks with Hewlett-Packard Co. for an unprecedented paid product-placement deal. Music-industry executives deemed the discussions, which commenced three to four months ago, as still in the "speculative" stage and a deal is not considered to be close.
If a partnership does come to pass, it could create a potentially lucrative revenue stream for Island Def Jam-whose roster of artists across a variety of labels include popular hip-hop performers such as Ludacris, Jay-Z, and Ja Rule-while availing the Silicon Valley-based technology marketer of a vibrant platform to brand its products via the artists' songs and videos.
Music executives said the scope of the talks did not yet involve the use of Island Def Jam artists in any future company advertising campaigns which-as in the case of Sting and Ford Motor Co.'s Jaguar-could goose record sales for the artist as well as brand awareness for the marketer. On the heels of its $19 billion acquisition of rival Compaq Computer earlier this year, stodgy H-P, led by beleaguered CEO Carly Fiorina, faces challenges in maintaining its retail presence for its signature personal computer lines and could be searching for new ways to gussy up its brand image.
An Island Def Jam spokesman declined to comment; H-P representatives also declined to comment.
These talks are just the first formal example of an initiative that is the brainchild of Island Def Jam President Lyor Cohen. According to music industry executives, Mr. Cohen has placed the courtship of brand marketers as a high strategic priority within the company, following the trail blazed by Hollywood movie studios. "Lyor's contention is if companies are willing to pay a premium to have their brands in movies, why wouldn't they jump at the chance to be in songs," said a music industry executive, who spoke under condition of anonymity.
As has been well documented, in the world of hip-hop-where there's a premium on thuggery and one-upmanship-it's all about the "bling bling" as brand conscious rappers over the years have literally sung the praises of such premium brands as Motorola and Cristal champagne. Yet, what marks these discussions as groundbreaking is that they contradict the established ethos in the hip-hop community of not "selling out." Heretofore, brand tie-ins with the hip-hop community have singularly revolved around product placement deals where the record label and artist did not monetize the arrangement beyond receiving free products.
In almost all cases, a brand has found its way into a rap song because of artist preference or through an organic, creative predilection and not because of a record label dictate to appease an advertiser. For example, not until Busta Rhymes's recent single "Pass the Courvoisier Part Two" moved a healthy number of units was a promotional deal with Allied Domecq inked. This relationship has had a significant boost on sales of the Allied Domecq brand, according to the company.
This established modus operandi is slowly starting to evolve as evidenced by the Island Def Jam/H-P talks and the purchase of Armadale Vodka by one of Mr. Cohen's labels, Roc-A-Fella Records. It's a safe bet artists are busy crafting clever rhymes for the house brand. Is there a danger of going too far?
"We're dealing with very savvy, trend-setting consumers, who can't be tricked," argues Stephanie DeBartolomeo, marketing director Courvoisier, Allied Domecq Spirits and Wine N.A. "They embrace brands that are relevant to them and have a degree of authenticity and heritage." If it appears that the artist is blatantly plugging a product, the consumer will likely tune out. Thus, Allied Domecq, for one, plans to maintain its less aggressive approach in its relationships with the music industry. But don't be surprised if other marketers are more daring in their partnerships, which would be a boon to people like Mr. Cohen. "Don't be surprised if you start seeing a steady stream of these types of deals," says a marketing executive at a major record label. "Artists and labels realize the potential upside."