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The
Gospel
Truth
Brenda Culpepper and New Haven's PepperCo. Records carve a music-industry niche
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Business New Haven
7/3/1995
By: Terry Pitt
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Listen up: Music recording is big business. Consumers are expected to spend approximately $9.5 billion for recorded music in 1995. The gospel music industry accounts for approximately three percent of that total, or some $285 million. New Haven's PepperCo Records is expected to generate approximately $2.3 million in revenue and more than $600,000 in pre-tax profits during 1995 - a tenfold increase from last year.
But there's more to this story of song.
Pepper Co. Inc. (PepperCo) is one of the largest minority-owned companies in the gospel music industry and one of only two independent record labels in the country owned by minority women. Brenda Culpepper, who was the Connecticut Post's 1994
Woman of the Year, talks cautiously about wanting PepperCo to become the Motown of gospel. “In terms of longevity, we've been successful”, she says. “But my personal thing - where everybody knows your name - we don't have the recognition I'd like to have.”
In 1988, Culpepper, who formerly worked in the real estate business, established PepperCo as a financial consulting business with her husband Irvin, an investment banker for Kelso & Co. in New York. They entered the music business when they did some work for Joel Bryant. A former music director for the Stylistics and the O'Jays, Bryant was in the band of gospel star Tramaine Hawkins.
“We managed a concert by Tramaine Hawkins at
the Klein Auditorium [in Bridgeport],” Culpepper recalls. “Tramaine fell in love with us. Five years later, we're fast friends.” Impressed, Bryant then asked the Culpeppers to produce a concert in New York featuring the East Coast Regional Mass Choir and gospel stars John P. Kee and J.C. White. Hawkins “gave us her band, essentially,” and they recorded the show. “We shopped the master tape and five record companies wanted to buy it,” Culpepper recalls. “I said, 'I think we're gonna start a record label.'”
Moving her company in February of this year from 1,400 square feet in Monroe to 3,000 square feet in New Haven's Science Park allowed Culpepper to take advantage of the city's status as an enterprise zone. “Science Park's management made me an offer I couldn't refuse,” she says.
On a search for funds for about two years, she had difficulty getting money because music is perceived as an art form, even though her business is in a lucrative industry. “They took us seriously and studied my business plan. The synergy just works here, and I'm excited about it.”
Science Park is committed to helping develop the product lines through their financial and grant funding network. It is writing a grant exclusively for the benefit of PepperCo's merchandising division, Merchant's House, for the purchase of equipment. Culpepper is working with Science Park's job-development arm to add more workers (the company employs seven in New Haven, and two on the West Coast) as the business expands.
Through its Pepperco Music Group (PMG), the company is engaged not only in gospel music with Pepperco Records but in secular music as well. Rap, hip-hop and rhythm and blues (R&B) are handled by PMG's Nu Groov Music, with Billy Preston as its first artist. (Preston, who met Culpepper at a gospel convention, divides his musical time between pop and gospel.) Jazz is marketed through PMG's PepperCo Jazz. PMG also has two publishing companies, Pepperco Music and PCO Music.
PMG's primary activity has been in the gospel field. PepperCo's first gospel project, the East Coast Regional Mass Choir's Live in New York, won five major awards and was nominated for a Grammy. Two of its projects released last year, the Gospel Music Workshop of America's men's chorus' The Chief Cornerstone and the Rev. Hubert Powell's Thank You For Your Touch, were nominated for Stellar Awards.
The key elements to success in the recording industry involve: finding exceptionally talented artists, able producers and suitable material (artist and repertoire); creating high quality master recordings at the lowest reasonable cost (recording process); having the products reproduced with high quality at the lowest cost obtainable (manufacturing); getting the products exposed to consumers via radio airplay and print media (promotion and marketing); and having the product available to the consumer in the largest number of retail outlets possible (distribution).
PepperCo's management has worked well with all of these elements - except distribution. To address that shortcoming, PepperCo is forming its own distribution company, the PepperCo Distribution Network. PepperCo Records has eight artists and eight projects in the market, with six additional projects to be released during 1995-96. Nu Groov Music expects to market two projects in 1995, with Billy Preston and PepperCo Jazz is currently developing two to three projects for 1995, which includes a pressing of Billy Preston's jazz band.
PepperCo is the first gospel recording company to start a secular division, Nu Groov, in what Culpepper calls her “reverse marketing strategy.” The statistics prove it's a sound risk: While a gospel “hit” means sales of 30,000 units, a group like Boyz II Men sells seven million units of one of their hits with spiritual overtones. Culpepper got the message. “That's what we're doing. Billy Preston is our first, but our A&R people are busy negotiating with other artists.” Preston agreed in an interview in Bridgeport recently. “People are looking for spirituality,” he said.
PepperCo Entertainment Group sponsors concerts in order to promote PepperCo's artists and to enhance the company's cash flow. PEG sponsored the Barnum Festival Gospel Explosion, a concert featuring Dr. Bobby Jones, and recorded it live in Bridgeport. It was also filmed for television and aired on BET and CPTV. PEG offered the concert for sale to individual consumers, concert participants and others, as well as to cable and TV programs wanting gospel TV programming around the world. PepperCo is also planning to videotape its live recording sessions and offer them for sale along with the cassettes and CDs.
Fifty thousand units of an audio tape entitled The Spirit in You have been distributed in 1995 by PEG's Special Markets Division, managed by Derek Daniels of New Haven, and 300,000 more will be shipped by year's end. They represent PepperCo's piece of a special promotion currently running with the Personal Care Products division of IVAX Corp., which consists of Johnson Products, Flori Roberts and Poners, collectively known as the Johnson Group.
PEG, in conjunction with IMAJEN Inc., created the tape, a compilation of several PepperCo and Motown recording artists. The cassette, the first music promotion of its kind in the U.S., will be featured as a premium in Gentle Treatment home hair-relaxer kits. PepperCo is currently negotiating with a mail-order hosiery company to develop a similar promotion to its five million customers.
The Merchant's House markets T-shirts and other products with themes and designs related to PepperCo's music business. It is also the exclusive licensee of the Kingdom Wear line of clothing for children. The license agreement, which was issued by the Kingdom Builders Foundation for its affiliate, the Kingdom Builders Youth Association, will allow the Merchant's House to design, manufacture and market children's clothing worldwide under the Kingdom Wear brand name.
So far, two lines are designed: hoodies and graffitti-wear. When the grant comes through from Washington, PepperCo will set up a merchandise manufacturing company in Science Park's Building 25. The products will be sold in kiosks in shopping malls.
Young people will be involved in the design, manufacture and sale of the merchandise. “Jobs are an alternative, but we want to teach young people entrepreneurial skills,” Culpepper says. One of many initiatives to present positive role models and teach life skills to youth, the company also hires office interns who are held to the strict norms of integrity and personal pride pervasive in PepperCo businesses, while learning computer graphics and other business skills. And they get to meet some of the stars of the industry, like Darrell McDaniel, who visited the office in June.
PepperCo has an agreement in principle with hip-hop and rap star McDaniel (from the group Run DMC) to do a music video in which he would appear in the popular kids' clothing of today which Culpepper and McDaniel believe are not appropriate for a generation growing up needing to feel better about themselves. Gradually, he would morph into a well-dressed young man - wearing PepperCo's designs.
PepperCo's management team has more than 50 years of combined experience in the music business and more than 90 years of total business experience. Management's strengths are in finance, artist and repertoire, radio promotions and marketing. It has specialized in being creative and innovative in developing novel royalty concepts, and broadening the genre of gospel music.
Culpepper likens music production to baking a cake. “PepperCo is the chef. We assemble the ingredients by recruiting gospel artists, choosing a producer to record them, the voice and musicians are the eggs and spices, the producer does the mix-down, the pressing process is the oven, and the frosting on the cake is the design and packaging.” Then it goes to market. PepperCo ships product to the 1,100 U.S. stations that play gospel, plus 300 countries around the world.
Culpepper describes a major shift occurring in the musical tastes of the desirable (to advertisers) 25-to-44-year-old consumer base. When a giant like New York's WRKS (98.7 FM) changes from hard rhythm and blues to the classic Motown sound of the '60s and '70s, you know the baby boomers are feeling nostalgic - and having their way, as usual. That's one reason her expectations are so high for the Billy Preston albums, and Culpepper is looking to other talent from the same era. “The day of the diva is coming back,” she says. “You may even be able to understand the words.”
It's certainly easy to listen to Brenda Culpepper. Still, “It hasn't been easy to survive in the music business, especially as a woman in a male-dominated industry,” she observes. But PepperCo and its new divisions are ready to expand and grow in the fertile surroundings of Science Park.
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