Hip-Hop Economy

From New York to Nepal, Hip-Hop has become America's leading culture export

that Adidas could gain market share from Nike and Reebok in the sneaker wars. Simmons boasted that Run-DMC would have more “street credibility” than any jock. Since then, hip-hop has been known to drive sales for everything from two-way pagers and cellular phones to Timberland boots, as young consumers see their favorite hip-hop artists sporting such gear.

The success of the Run-DMC/Adidas partnership led to rappers, officially and unofficially, endorsing products. In 1994, when Snoop Dogg’s “Gin and Juice” hit the charts, sales for Tanquery Gin went up 10%. Riding that wave, Absolut Spirits Co. executive Carl Horton successfully introduced Seagram’s Gin & Juice product. Other liquors mentioned in rap songs include “Henny” (a.k.a. Hennessy), “Dom P.” (a.k.a. Dom Perignon), and Cristal Champagne. Earlier this year, Sean “P. Diddy” Combs and Busta Rhymes released a song titled “Pass the Courvoisier,” celebrating an upscale brand of cognac.

Witnessing the power of the culture, major companies increased advertising to reach young consumers. Some $150 billion was spent in advertising in 2001, according to Wilkofsky Gruen Associates, a media, entertainment, and telecommunications research firm. Most of that money4$53.5 billion worth4was spent on network television spots, with the remainder split between cable TV, radio, newspapers, magazines, and the Internet. “Advertising tends to follow popular culture, and clearly rap has built a popular following,” says Jeffrey Logsdon, an analyst at Gerald Klauer Mattison & Co. “And to utilize that, either from a talent standpoint or a music standpoint, furthers the hope of an advertiser identifying with an important segment of the population.”

In the ’80s, the Motown Soun
d dominated television ads and soundtracks before the trend ran its course (Remember the animated Motown-singing California Raisins?). In the ’90s, rap was the leading theme music. But the key, a decade ago as well as today, is for advertisers to come up with a message that connects with young people.

Reginald Jolley (a.k.a. ReggieKnow), formerly creative director at Burrell Communications Group Inc. (No. 3 on the 2001 BE ADVERTISING AGENCIES list with $179.4 million in billings), won praises for his inventive “Obey Your Thirst” campaign for Sprite soft drink. Introduced in 1994, the campaign has featured pitchmen such as Old School rapper Afrika Bambaataa of Soul Sonic Force, as well as popular performers such as Fat Joe and Mack 10. The campaign established Sprite as one of the leading brands for Coca-Cola Co. in the ’90s, and, at one point the fastest growing carbonated drink in the U.S. According to Beverage Digest, Sprite is still the leader in the lemon-lime category, holding 68% of the market and outpacing its rival, 7 Up. “[Jolley’s] campaigns were successful because he really understands the culture. He lives it and knows what the audience is looking for,” says Anslem Samuel, culture editor for The Source. “Now when you have some lamebrain campaign where there’s someone attempting to rap or do a jingle that mimics a style of rap, it comes off corny because it’s obvious that someone didn’t do their homework.”

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