This is done on the Michelin Test Track you unlock in Career mode, NOT the location you can setup in a Custom Match.
You must first unlock the "My Michelin Test Track" by getting fair enough in Career mode. Once in it, choose the "Skid Pan" Discipline, this is the figure-8 track. You will want to select a vehicle with a high level in drifting, I choose the BMW K1200R (Class B bike). I like the bikes over cars as they are smaller and don't hit the cones as much.
Once on the track you have to complete a full figure 8, not just one small loop while drifting. You *don't* have to be drifting the whole time, just enough to keep the Kudos combo going. Make sure to avoid the cones as they will break your combo.
Thanks to Reabo for putting together the YouTube video