CHAPTER 4: Exploring Your Market 155 Simmons knew how to market his product, and sophistication to market ideas as well as and his ability to promote rap music and the hip- products and services. He continues to sit at the hop lifestyle was influenced by how close he was helm of Rush Communications, where he keeps to it. his radar attuned to new opportunities in the Simmons has maintained the philosophy of marketplace. "keeping it real" throughout his business career. It permeates everything he does and is even re- flected in his preference for wearing Phat Farm Case Study Analysis sweatshirts instead of Brooks Brothers suits. 1. Why do you think Russell Simmons has Since those early days, Simmons has gone on been successful? to launch many other business ventures, which 2. Describe the target market that Simmons is are all geared toward the same target market: ur- trying to appeal to in all of his business ven- ban teens and young adults. This market has the tures. What does this target market value? power to influence the tastes and preferences of 3. Simmons grew up surrounded by hip-hop other consumers. music and culture. In what ways did this give him an advantage in the marketplace? Simmons's Empire Grows How might his insider's knowledge also In 1999, Simmons sold his stake in Def Jam re- function as a limitation? cords to Polygram Records for over $100 million. 4. Brainstorm a business idea that you could He has since focused his energies on developing pitch to Russell Simmons that would be ap- the various entertainment, fashion, and multi- propriate for Rush Communications. What media companies that make up Rush Communi- market research would you need to conduct cations. Simmons's business goals have evolved in advance to assess whether or not your from promoting hip-hop music to developing idea had the potential to be successful? new products and services for the urban youth 5. Russell Simmons invested $5,000 to start market. Def Jam and then later sold his business to Simmons also began using his status as Polygram Records for $100 million. Calcu- a tastemaker and hip-hop entrepreneur to in- late Simmons's return on investment (ROI). fluence public debate about political issues. In 2002, he organized a youth summit in New Case Sources York, featuring hip-hop artists such as Jay-Z and Jennifer Reingold, "Rush Hour," Fast Company, Alicia Keyes. When Simmons put out a call to no. 76, November 2003, action over the airwaves, over 20,000 students showed up at New York's City Hall to protest the Russell Simmons, Life and Def: Sex, Drugs, mayor's proposed cuts to the education budget. Money + God (New York: Crown Publishing, Simmons has demonstrated that he has the skill 2002) Case Study Russell Simmons, Hip-Hop Entrepreneur Russell Simmons turned off his cell phone and took a rare moment to admire the view from his fourteenth-floor office in midtown Manhattan At 47, Simmons knew he had a lot going for him. As the president of Rush Communications, he sat at the helm of a constellation of successful enterprises, including a record label, a cloth- ing line, a philanthropic arts foundation, and a multimedia production company. Lately, he had been thinking about how to leverage his influ- ence as a hip-hop mogul to inspire young people to get involved in social issues such as voter registration and education reform. Yet, when he was growing up in Hollis, Queens, in the 1960s and 1970s, Simmons never could have imagined that his life would have turned out as it had. Window of Opportunity Early on, Simmons decided that he wanted to make his own way in the world. His father had been a teacher and his mother worked as a recre ation coordinator. Both enjoyed stable jobs, but Aussell Simmons, media magul Simmons was not driven by a need for security (Getty Images, Inc.) He wanted to live a fast-paced life and call his own shots. In 1977, Simmons, who never liked school way." Bridging the worlds of rock and rap mu- very much, enrolled at the City College of New sic turned out to be a stroke of genius. Simmons York as a sociology major. That year, something and Rubin single-handedly introduced a whole happened that permanently changed the course of new market of mostly white, suburban, heavy. his life. He went to hear a rap artist named Eddie metal music fans to hip-hop. Suddenly, Run Cheeba perform and was amazed to see how the DMC was being featured on MTV, and rap was rapper had cast a spell over the audience with his no longer an underground fad. freestyle rhymes. In Simmons's own words, "Just like that, I saw how I could turn my life in another, Marketing Insight Authenticity Matters better way.... All the street entrepreneurship I'd Simmons learned an important lesson from Run learned, 1 decided to put into promoting music." DMC's success. He realized that these artists had At that time, rap and hip-hop were under gone to the top of the charts because they had ground music styles, but Simmons set out to remained true to their street style and musical change that. He believed that rap music had the origins. Whereas Run DMC may have popular- potential to reach a larger audience and so he ized wearing gold chains, branded sneakers, and teamed up with another aspiring rap producer name-plate belts among suburban teenagers, Rick Rubin Rubin had built a recording stu- these were the fashions that its core audience of dio for rap artists in his New York University urban youth had already embraced Simmons dorm room. Together, they decided to transform understood that being perceived as authentic Rick's studio into a viable record label. By 1985, was key to making it in his segment of the music Def Jam Records was officially underway industry: "You have to tell the truth. It endears Def Jam experienced its first surge of suc- you to the community. The (people) can smell cess when it scored a hit with Run DMC's the truth, and they're a lot Smarter than the remake of the Aerosmith classic, "Walk This people who put the records out." "Simon Defensowym York Ning 2000 154 CHAPTER 4: Exploring Your Market 155 Simmons knew how to market his product, and sophistication to market ideas as well as and his ability to promote rap music and the hip- products and services. He continues to sit at the hop lifestyle was influenced by how close he was helm of Rush Communications, where he keeps to it. his radar attuned to new opportunities in the Simmons has maintained the philosophy of marketplace. "keeping it real" throughout his business career. It permeates everything he does and is even re- flected in his preference for wearing Phat Farm Case Study Analysis sweatshirts instead of Brooks Brothers suits. 1. Why do you think Russell Simmons has Since those early days, Simmons has gone on been successful? to launch many other business ventures, which 2. Describe the target market that Simmons is are all geared toward the same target market: ur- trying to appeal to in all of his business ven- ban teens and young adults. This market has the tures. What does this target market value? power to influence the tastes and preferences of 3. Simmons grew up surrounded by hip-hop other consumers. music and culture. In what ways did this give him an advantage in the marketplace? Simmons's Empire Grows How might his insider's knowledge also In 1999, Simmons sold his stake in Def Jam re- function as a limitation? cords to Polygram Records for over $100 million. 4. Brainstorm a business idea that you could He has since focused his energies on developing pitch to Russell Simmons that would be ap- the various entertainment, fashion, and multi- propriate for Rush Communications. What media companies that make up Rush Communi- market research would you need to conduct cations. Simmons's business goals have evolved in advance to assess whether or not your from promoting hip-hop music to developing idea had the potential to be successful? new products and services for the urban youth 5. Russell Simmons invested $5,000 to start market. Def Jam and then later sold his business to Simmons also began using his status as Polygram Records for $100 million. Calcu- a tastemaker and hip-hop entrepreneur to in- late Simmons's return on investment (ROI). fluence public debate about political issues. In 2002, he organized a youth summit in New Case Sources York, featuring hip-hop artists such as Jay-Z and Jennifer Reingold, "Rush Hour," Fast Company, Alicia Keyes. When Simmons put out a call to no. 76, November 2003, action over the airwaves, over 20,000 students showed up at New York's City Hall to protest the Russell Simmons, Life and Def: Sex, Drugs, mayor's proposed cuts to the education budget. Money + God (New York: Crown Publishing, Simmons has demonstrated that he has the skill 2002) Case Study Russell Simmons, Hip-Hop Entrepreneur Russell Simmons turned off his cell phone and took a rare moment to admire the view from his fourteenth-floor office in midtown Manhattan At 47, Simmons knew he had a lot going for him. As the president of Rush Communications, he sat at the helm of a constellation of successful enterprises, including a record label, a cloth- ing line, a philanthropic arts foundation, and a multimedia production company. Lately, he had been thinking about how to leverage his influ- ence as a hip-hop mogul to inspire young people to get involved in social issues such as voter registration and education reform. Yet, when he was growing up in Hollis, Queens, in the 1960s and 1970s, Simmons never could have imagined that his life would have turned out as it had. Window of Opportunity Early on, Simmons decided that he wanted to make his own way in the world. His father had been a teacher and his mother worked as a recre ation coordinator. Both enjoyed stable jobs, but Aussell Simmons, media magul Simmons was not driven by a need for security (Getty Images, Inc.) He wanted to live a fast-paced life and call his own shots. In 1977, Simmons, who never liked school way." Bridging the worlds of rock and rap mu- very much, enrolled at the City College of New sic turned out to be a stroke of genius. Simmons York as a sociology major. That year, something and Rubin single-handedly introduced a whole happened that permanently changed the course of new market of mostly white, suburban, heavy. his life. He went to hear a rap artist named Eddie metal music fans to hip-hop. Suddenly, Run Cheeba perform and was amazed to see how the DMC was being featured on MTV, and rap was rapper had cast a spell over the audience with his no longer an underground fad. freestyle rhymes. In Simmons's own words, "Just like that, I saw how I could turn my life in another, Marketing Insight Authenticity Matters better way.... All the street entrepreneurship I'd Simmons learned an important lesson from Run learned, 1 decided to put into promoting music." DMC's success. He realized that these artists had At that time, rap and hip-hop were under gone to the top of the charts because they had ground music styles, but Simmons set out to remained true to their street style and musical change that. He believed that rap music had the origins. Whereas Run DMC may have popular- potential to reach a larger audience and so he ized wearing gold chains, branded sneakers, and teamed up with another aspiring rap producer name-plate belts among suburban teenagers, Rick Rubin Rubin had built a recording stu- these were the fashions that its core audience of dio for rap artists in his New York University urban youth had already embraced Simmons dorm room. Together, they decided to transform understood that being perceived as authentic Rick's studio into a viable record label. By 1985, was key to making it in his segment of the music Def Jam Records was officially underway industry: "You have to tell the truth. It endears Def Jam experienced its first surge of suc- you to the community. The (people) can smell cess when it scored a hit with Run DMC's the truth, and they're a lot Smarter than the remake of the Aerosmith classic, "Walk This people who put the records out." "Simon Defensowym York Ning 2000 154