Richard Branson on What They Don't Teach in Business School
A lot of people ask me about the Virgin brand -- what’s our secret? What’s the enduring magic formula? The truth is, we started with a really simple idea that has developed over time. When I opened my record store, I thought it might be a success if I made it a cool place to hang out and kept prices low. I hoped that the combination would make the store popular and that the resulting sales volume would make up for lower prices. These basic notions formed the beginning of what people now call brand values. At Virgin, ours include providing good value for money and a great customer experience.
I firmly believed back then, and still do now, that you can apply those values to any business situation. That’s why I wasn’t afraid to launch an airline -- I thought the principles we’d relied on in the music industry would make the airline successful.
Today Virgin has become one of the most diverse brands in the world as we have continued breaking into new markets and shaking them up for the customer’s benefit. And our brand values are the glue that holds it all together.
That doesn’t mean our business is a complete free-for-all, as my team often reminds me. Though we receive proposals for almost every imaginable product and service – drinks, plastic surgery, clothing, restaurants, care for the elderly, even funeral services – we have a central team that evaluates each idea to see if it fits with our values and what consumers expect of Virgin. Sometimes the debate is fierce!
Sometimes we take a risk and it doesn’t work. For example, we started a consumer electronics business in the U.S. in 2002, but we found it difficult to differentiate our products from those already available. We also learned that we are better at delivering the Virgin magic by creating an overall customer experience rather than simply selling a product.
And then sometimes our risk-taking pays off in dividends, such as our turn-around of Britain’s ntl:Telewest cable business, which became the successful, customer-focused business now known as Virgin Media. This major effort involved moving some of our best people into that business and changing the focus from quarterly sales targets to longer term goals that involved keeping customers happy and loyal. (Keeping both customers and employees happy is good for the business, and not a cost that can be cut!)
We are often told that the Virgin brand is one of the most powerful brands in the world; my current goal is to make it one of the most trusted.
How am I tackling this rather large task? I’ve gathered our top people, both in the Virgin businesses and from our central brand team, which is headed by Catherine Salway, group brand director. She has put together a structure to ensure that every company in the Virgin Group is aware of our values and also our customers’ expectations. We provide brand training for all our businesses and supply the tools they need. We set targets at all our call centers for customer satisfaction and measure them on a quarterly basis. We bring together all our marketing departments to share ideas. And every new business gets all this help right from the start.
Catherine recently wrote a strategy paper called “Virgin Rising,” laying out how we will make Virgin even stronger in the future. She argued that, regardless of how respected Virgin has become – we now operate in 29 countries, employ 50,000 people and serve millions of customers every month – we cannot be complacent. She highlighted core areas that all Virgin companies must treat as priorities in order for the brand to flourish. These include everything from Virgin brand basics to connecting with customers online. She also emphasized collaboration among Virgin companies, entrepreneurialism, ethics – and also music, fun and rock 'n’ roll! In essence, she showed us how to reach our new goal.
I often mention people like Catherine – not sales statistics or the bottom line. I truly believe that the people working at Virgin are the heart and soul of our brand. The simple concept of offering customers a better experience, and having fun while you do it, attracts very bright and enthusiastic people. So while we have fantastically creative marketers who develop brilliant ad concepts, we also have wonderful people who deal with our customers every day. This emphasis on people is what really makes Virgin special.
In business schools, brand values are often discussed in terms of marketing, as though they are an end result of a scientific process, rather than embedded in a business’s beginnings. Thankfully, I’ve learned that in the real world of business, it’s better to rely on creativity, intuition and empathy. You can try to build a brand using a hands-off, theoretical approach, but you’ll do far better – and have more fun – if you stick to Virgin’s dynamic values.