He’s dyslexic and he dropped out of high school. Today, people fly in his airplanes, shop at his stores and may soon soar in his spaceships. Richard Branson is battling the big boys in his own backyard
Digital Journal — With 236 companies under his thumb, Branson has branded Virgin as a David fighting corporate Goliaths
In October 1992, Richard Branson defended his company like he was protecting his child from a pack of bullies. He had compiled evidence that his monolithic competitor, British Airways, was smearing his Virgin Atlantic airline. BA employees had poached potential customers at airports, convincing them Virgin was not worthy of their hard-earned money. It didn’t stop there: Branson also claimed BA’s PR consultant had been undermining him and his company in the press.
Branson’s empire fought back by suing BA for libel. The “dirty tricks campaign,” as it became known, won Branson thousands of fans and in 1993, a settlement worth $1.5 million in damages. Instead of shuttling the money into the company bank account, Branson spread the windfall to his staff, giving each employee a “BA Bonus” of $400.
This story shows the two different sides of Branson the billionaire: There’s the bombastic underdog, a man determined to fight the industry with as much passion as he can muster, even if means using a publicity stunt or two. Then there’s the man who will funnel a court settlement to his employees, a boss who remembers how he got where he is today. This is the charmer, the smiling everyman, the favourite uncle.
Over the years, he’s expanded the Virgin brand into 236 different companies, encompassing everything from cell phones to airlines to colas. Together, they are worth more than $11 billion (CDN).
Wealth is only one reason media follow his every move. Branson’s publicity stunts, each more grandiose than the next, plaster newspapers and TV broadcasts. The reality TV industry jumped aboard, granting Branson his own show, The Rebel Billionaire, which spotlighted his adventures as a skydiver, cliff-jumper and unremitting risk-taker — not to mention businessman.
Is there anything Branson won’t do? He wore a wedding dress and high heels when he unveiled Virgin’s line of bridal wear; in Toronto recently to launch Virgin Mobile Canada, he boarded a monster truck and steamrolled three cars, symbolically crushing his hassle-ridden telecom rivals; he descended into Times Square by crane, wearing nothing but a body stocking. Branson has been all smiles and thumbs-up the whole time.
Well, there is something Branson won’t do, by the look of his shrewd determination: He won’t stop being the brash David to big business’s Goliaths.
Karma Chameleon
Some people just love a good challenge. When Branson was four years old and holidaying in Devon with his family, his aunt bet 10 shillings that he couldn’t learn to swim within two weeks. He splashed in the sea for hours, days, until his aunt finally said, “Well, we’ll wait until next year.” Young Branson ignored her pessimism. On the last day, as they began the 12-hour journey home, Branson asked his father to stop the car by a river. He jumped in, and the current instantly began tugging him downstream. But he kicked slowly, calmly, and within a minute he was swimming. When his aunt handed him the money, it was the largest amount he had ever held.
Another storied roadblock is Branson’s dyslexia, which left him with poor grades, irritated teachers and an early departure from high school. His last principal imparted a prophetic statement: “Richard, you will end up in prison or as a billionaire.”
So Branson began to fulfil the latter. After running a successful mail-order music business in London, England, called Virgin Records (the name asserted their commercial innocence at the time), Branson opened a recording studio and subsequently a record label in 1973. Four years later, Virgin signed notorious punk pioneers the Sex Pistols and eventually, Phil Collins and the Culture Club.
Branson wasn’t content with just music. He wanted to be the ultimate commerce chameleon by branching into sectors as divergent as possible. Software company Virgin Games launched in 1983, and then the CEO set his sights higher: Virgin Atlantic Airways hit the sky in a publicity stunt featuring Branson in a First World War flying outfit, perhaps symbolizing his resolve to blaze a trail amidst the wreckage of disastrous aviation upstarts like People’s Express and Braniff.
His goal was never to be the top player. He knowingly entered a market dominated by British Airways (hence the envy and dirty tricks), and that ballsy approach would repeat itself in other ventures. Virgin Megastores didn’t change the world, but they challenged the major record companies by unleashing slick ads aimed at the 18- to 34-year-old demographic.
“We’re for the younger crowd,” Branson told Digital Journal while on a business trip to Toronto. “We want to be different than what everyone is used to.”
Much like how 55-year-old Sir Richard (knighted in 2000) is different than any billionaire you can imagine. His personal trademark is his penchant for high-flying adventures, like his record-breaking Atlantic crossing aboard a Virgin motorboat. More well known is his 1991 transcontinental hot-air balloon ride, spanning 6,781 miles from Japan to the Yukon, the world’s first such trip. He owns a Gibbs Aquada amphibious car, in which he crossed the English Channel in less than two hours, breaking a decades-old record held by two Frenchmen.
“I’m so lucky to be in a position where I can do almost anything I want, and I don’t want to waste that,” Branson once told Sports Illustrated. And he extends that upbeat philosophy to his business.
Branson enters each industry like a spunky lightweight squaring off against a smug world champion. Virgin Cola swung at the giants of the soft-drink industry, Virgin Rail went toe-to-toe with the privatized British rail system, and Virgin Mobile pulled no punches against heavyweight North American telcos like AT&T and Rogers.
Around the World and Beyond
The Virgin name is plastered on CDs, wedding clothes, airplanes and motorcycles. Customers around the world are seeing the red cursive insignia in their backyard: Virgin Mobile expanded into Singapore, Virgin Active rolled out fitness centres across South Africa and Australian airline Virgin Blue is approaching its fifth birthday.
Branson also fuses his brand name with his daring personality. He financed the GlobalFlyer aircraft that flew millionaire adventurer Steve Fossett nonstop around the world in 67 hours, breaking a world record. In almost every article written about Fossett, Branson’s name appeared as a postscript to the landmark mission. The publicity wasn’t free — the experimental plane cost $1.8 million to build — but it was a savvy strategy to extend the Virgin name to those who might not fit his usual demographic.
It seems like the only turf Branson hasn’t yet targeted is outer space — until now.
“Like so many others, for years I have dreamt of seeing the beauty of our planet from space,” Branson said at the launch of Virgin Galactic in September 2004. “Someday, children around the world will wonder why we ever thought that space travel was just a dream we read about in books or watched — with longing — in Hollywood movies.”
Impelled by his own cosmic wanderlust, Branson negotiated a deal with the owners of SpaceShipOne, the first sustainable civilian spacecraft and winner of the $12.3-million X Prize. Branson’s latest business plan is to build spaceships that can carry 50 passengers per month, each forking over $250,000. This astronomical experience is scheduled to lift off in three years and already 7,000 people have signed up, including actor William Shatner and rock guitarist Dave Navarro.
Making the Brand
Commercial space flights are still a far-off promise, and Branson is entering an arena that could soon be crowded with competitors vying for space-tourism dollars. But it doesn’t matter if Branson is battling record companies or space airlines — he’ll fight tooth and nail to establish Virgin as a worthy contender. “We like to use the brand to take on some very large companies whom we believe exert too much power,” Branson once said.
Taking the underdog position is a smart move for any corporation that may be regarded as merely hungry for booming profits.
“Virgin’s brand story works well when rolling out vodka, cola or an airline,” says Tom Farmer, a branding consultant based in Seattle. “It’s the grey stodgy legacy brand versus the fresh audacious alternative.” Funnily enough, Farmer notes, Branson’s headline-grabbing stunts have made him both the most revered and reviled businessman in the U.K.
That isn’t necessarily a strike against Virgin and its hippie-capitalist founder. Turning people off means you’re also turning people on, and the Virgin brand has won many customers thanks to its in-your-face marketing campaigns that chop down complacent corporations.
Regarding Virgin Mobile Canada, Branson says, “Canada is hungry for this. They want to be freed from long-term contracts, from hidden fees. We’re looking out for the customer.”
Sounds a bit like PR-fed clichés, but Virgin’s modus operandi is to cast the competition as an old boys’ club and change the market for good. It doesn’t hurt to stretch the brand to make those cynical youth realize how a cool 35-year-old company can speak to their needs; Branson’s Robin Hood persona applies equally well to a party-crashing cola as it does to a populist space agency.
“We want to start a new era in space travel,” Branson says. “It will be affordable to the masses and we can do it. I know we can.”
I know we can. A statement to inspire the most crestfallen entrepreneur, and a perfect motto for Branson’s not-so-virgin Virgin Group. Note how he stresses “we can,” not “I can.” Branson may be the face of Virgin but it’s a team effort, never a solo trip. Virgin’s 200-plus companies are each helmed by their CEOs and run separately from their brothers and sisters.
His kids, both real and business, should be concerned. This is a family helmed by the kind of father who will risk his life for his company, a man who will thrash against an icy current just to prove he can swim. And this daredevil giant-killer will not come up for air until he covers the world in Virgin territory.
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