Urban Pioneers

NEW YORK In his hit song, “People Like Myself,” hip-hop artist Timbaland writes that people like him “only hang with self cause that’s the way to go.” But Timbaland found another way to go: He struck a precedent-setting deal with Verizon Wireless to distribute a collection of songs directly to the carrier’s V Cast subscribers, and to create content such as behind-the-scenes video footage of his recordings. Timbaland’s marketing effort helps Verizon as well, as the carrier aims to be a destination for young urbanites attuned to cutting-edge music and culture.

Timbaland is just one of several hip-hop artists and producers who are pioneering the mobile media space. And in transforming it into a major marketing platform, they can serve as models for brands ranging from packaged goods to autos trying to reach consumers on the move while leveraging new technologies.

Hip-Hop History

Hip-hop, born three decades ago at a Bronx block party when a DJ scratched a record to create the break-beat sound, has exploded into a culture that thrives on, and influences, music, fashion and art. It is the epicenter of cool for the young people driven to wear the newest styles and own the latest gadgets. It makes sense, then, that hip-hop artists more than those in any other genre have embraced the mobile medium as a tool for maximum audience reach.

“Hip-hop artists have done a tremendous job of tapping into the mind-set of who their consumer is,” said Kerry Perse, director of digital relationship marketing at Horizon Media’s interactive division.

Another recording artist using the mobile space is Rapper Murs (Making Underground Raw Shit), who is creating mobisodes (to be distributed across all carriers) to promote his new album, Murs for President. And fellow rapper Snoop Dogg — both he and Murs work with The Cashmere Agency — will launch a mobile video campaign this summer, for his new album, The Blue Carpet Treatment.

Additionally, late last year QD3 Entertainment, an independent production company led by Quincy Jones III that produces urban-focused content (e.g., documentary films), launched a QD3-branded channel on Helio.

“Hip-hop has been a viral phenomenon from day one,” noted QD3’s Jones, chairman, CEO and CCO. “I think that mobile and the Internet platforms provide an arena where they can do their own thing. I think it’s the empowerment of it that’s big as well. Like doing your own thing and being in charge of your destiny.”

According to eMarketer, mobile ad spending will reach $1.6 billion in 2008 and jump to $4.8 billion in 2011. Yet some marketers have hesitated to jump in due to a lack of ROI metrics and success stories, high costs and other obstacles.

“I think a lot of clients feel as though getting into mobile has a high cost of entry, depending on the level of sophistication of the program they may want to run,” said Horizon Media’s Perse. “There can be a really large investment in the infrastructure up front.”

Added Linda Barrabee, program manager, consumer research, The Yankee Group, “there’s a lot of confusion due to the complexities of the medium.”

But while technology issues, such as bandwidth headaches and handset applications, have been challenging the potential of mobile marketing, an increasing number of phones are faster and have the ability to show video.

Susan Walton, manager of digital and CRM marketing for the Saturn brand at General Motors, said for her the problems are less technologically based than legal. “This is a new platform for us,” she said, “so it’s new territory for our legal counsel and it’s taken some time to get all of the approvals — especially in dealing with such a small space.”

Ringing in the Cash

The first true platform for music on a mobile device, ringtones, are still in demand. And according to Nielsen RingScan, nine out of the top 10 master tones in 2007 were hip-hop songs. (Like Adweek Media, Nielsen RingScan is a unit of the Nielsen Co.)

“I look at a ringtone as the new concert T-shirt,” said John Franck, svp of marketing at independent label Koch Records. (At Koch, the mobile/digital space accounted for roughly 35 percent of its $40 million net revenue in 2007, according to Franck, with hip-hop accounting for the majority of that percentage.)

The early success of ringtones encouraged several top advertisers to use the technology, including Procter & Gamble. Last year, the company partnered with MTV to create a free ringtone program for Herbal Essences. “One of the biggest things we learned is that the ringtones [were considered] a reward for consumers,” said a P&G representative.

Industry observers expect increased advertising activity in the mobile space.

Real Content Group, for instance, a digital distribution network for urban-content artists, said it’s working on a strategic partnership with a U.S.-based ad agency looking to gain entry into the multicultural and youth space. The parties have been in talks to create products for marketers, such as branded ringtones, branded videos, video tones and branded avatars, said Troy Brown, CMO of Real Content, who declined to elaborate. (Interestingly, RCG was originally formed in 2005 as Real Hip Hop, but changed its name last year to reflect its expanding focus on additional music genres.)

The Timbaland-Verizon deal calls for the hip-hop producer to become Verizon’s “mobile producer in residence.” During 2008, Timbaland will produce one song per month, each time with an artist from a different musical genre.

The songs are being recorded on the road in Verizon’s mobile recording studio bus, and each track will be released within days of being produced. Verizon’s V Cast has also set up a dedicated Timbaland channel where subscribers can view footage of the artist producing the songs.

Murs plans to unveil new technology when he goes on tour next autumn to promote his new album, Murs for President, which will be released in early summer. The rapper said the technology would allow concert-goers to text messages and photos that will appear along with their names behind him on a screen as he performs.

“Murs for President” mobisodes will be running as early as April as a lead-in to the release of his album. The series follows Murs on his promotional tour, which is being described as similar to the campaign trail. It has yet to be determined how the shorts will be accessed.

The mobile-video component of Snoop Dogg’s album, The Blue Carpet Treatment, will be taken from a film, The Adventures of the Blue Carpet Treatment, which will consist of animated videos of the songs. The Cashmere Agency is putting together a mobile campaign showing snippets of the videos, which will be accessed through a downloadable link, leading up to the DVD release in late summer.

QD3’s branded channel will offer its content as well as behind-the-scenes footage on the making of its films. Jones said the entertainment company had been trying to do something similar with a few carriers for quite some time, but this was really the first opportunity where the technology has made it feasible.

“I know it’s probably going to be a year until mobile video takes off, but we wanted to get in early and experiment,” he said.

Both the V Cast service and the QD3-branded channel on Helio are subscriber based, and at present there is no advertising attached from the carrier side.

QD3 has the option to integrate ads into its content, noted Paul Campbell, president and COO, an option the entertainment company is exploring. The hope is that the channel, which falls under Helio’s overall Music Mix service, will gain a large enough audience that advertisers would get the reach they desire. When deals do get made, the structure would be similar to a product integration ad buy.

Any such advertising, Campbell emphasized, would have to work organically with the content, “especially if people are paying for this as part of their subscription. Not all content is going to fit the model.” QD3 said it’s in talks with advertisers, though Campbell declined to identify them.

Murs’ record labels will be approaching advertisers for the pre-roll real estate, said Rona Mercado, vp of marketing at Cashmere Agency/Stampede Agency. (Cashmere handles the marketing, while Stampede manages the artists.) Mercado added that if advertisers are interested in product-placement opportunities, that might become viable as well. MP3 and cell phone companies have approached the agency seeking such opportunities, she said.

Pre-roll spots may also be made available for the Snoop Dogg campaign, though Code Black Entertainment, which will be distributing the DVDs, is primarily treating it as a promotional vehicle.

Not There Yet

Chris Jones, senior brand manager at phone carrier Boost Mobile, said the ad-supported model has yet to come to fruition. The reason: There’s not enough revenue coming in through mobile advertising to support the content through an ad-based system.

“We in the mobile space believe that’s where we are going and it’s [just] a matter of time before we get there,” said Jones.

As issues of tracking and reporting make headway, the expectation is the space will begin to take off.

The time may not be far off, according to John Huffman, CEO of RCG and co-chairman of an urban special-interest group created a year ago within the Mobile Marketing Association. Huffman said one of the group’s priorities is to set policy on these areas, which they hope to complete this year.