This is not just one outdoor bar; this is a whole street full of them. Just tell a taxi driver you want to go to "Coco", or hop on the metro and get off at Gouwu Gongyuan. The entire east side of Coco Park is an outdoor bar street, and on a good night there will be such a good crowd that you can't tell where one bar ends and the next begins.
Most of these bars offer decent Happy Hours, and start to get pretty lively after dinner time. Three of the most popular are Demon Bar, Loxon Bar, and Norway Place Oslo.
Add: Coco Park, Gowu Gongyuan, Fuhua San Lu, Futian District
Getting there: Metro Line 1 to Gouwu Gongyuan, Exit C and follow the noise