What is it with Virgin? Robert Maxwell once explained that he
bought companies like alcoholics buy booze - because he just couldn’t
say no.
I suspect the same is true of Virgin: that whenever someone comes to him
with an idea for a Virgin brand extension, Richard Branson just can’t
turn it down.
On the face it, however, Virgin’s entry last week into the mobile phone
market, complete with pounds 20 million budget (unusually large by
Virgin’s parsimonious standards) has a certain logic and consistency.
Like most of the other sectors Virgin has entered - travel, PEPs, music
retail, cola, vodka, radio, clothes and so on - the main users of mobile
phones are the young, exactly the group with which the Virgin name has
most resonance. Furthermore, just as in airlines, PEPs and, although I
hardly dare mention it, trains, it is a sector where consumer trust is
at a minimum. Indeed, the term ’confusion marketing’ was invented to
describe the small print and tariff structures of the mobile phone
companies. Last, but not least, it is growing fast. For a brand which
has appointed itself people’s champion, this was too good an opportunity
to miss.
In classic Virgin style, we hear promises of single-tariff pricing
structures, and a range of so-called value-added propositions like free
voicemail, internet access and e-mail.
On this occasion, however, you wonder if it isn’t too late - by about
two years. If any brand can rightfully lay claim to single-handedly
reforming the Spanish practices of the sector it is Orange, with noble
assistance from the likes of Carphone Warehouse.The other major players
have since come into line and consumers now get a much better deal than
before.
Amid the usual sycophantic coverage of the launch it was telling,
therefore, to read a comment by no less an authority than Charles
Dunstone of Carphone Warehouse. ’Every one of the tariffs offered by
Virgin Mobile can be bettered by existing standard tariffs already
available,’ he said, clearly underwhelmed.
Moreover, it is worth pointing out that Virgin’s partner in this deal is
none other than One2One, by far the weakest of the four main players in
the UK market. Sure, there’s the romantic David and Goliath aspect, but
what does it say about Virgin’s proposition or clout if it picks the
runt of the sector with which to do business?
This isn’t the first time that anybody has questioned Virgin’s
brand-stretching potential. Although it has had a few successes - there
is no denying the effect Virgin PEPs and Virgin Atlantic have had on
their sectors - Virgin’s failures tend to be brushed under the carpet.
Assuming the jury is out for now on trains, I can’t believe that
Virgin’s achievements in cola, vodka, clothes or cosmetics have matched
the hype or its own expectations.
Increasingly, Virgin resembles a name in search of an opportunity. Of
course some people will see this as a classic example of the power of
the brand. To me it’s the kind of all-style-and-no-substance exercise
which gives branding a bad name.
