Tying down the Virgins

Richard Branson’s Virgin brand has proved much more flexible and promiscuous than most real life virgins - certainly any that I am concious of meeting. Getting in and out of bed with various partners, going public and then acting private again has been par for the course for the virgin with the capital V.

But now it takes another twist: the NTL acquisition of Virgin Mobile for €1.4bn is an interesting turn – an arranged marriage with massive alimony. Of this the shareholders of NTL are paying over €300m for the use of the Virgin brand in the telecommunications field over decades to come. One hopes that for this amount of money they will get enormous pleasure from their Virgin bride.

However, as NTL and their advisers are only too conscious, we live in a convergent world. Indeed this must be a significant part of the logic for their acquisition. Who knows in 20 or 30 years time how we will be defining the communications category? Music and television could be part of one entertainment market. The internet and air travel could be parts of one virtual and physical communications category. So NTL does not control the Virgin brand in all of its potentially conflicting manifestations today. Charles Trevail, quoted in today’s FT says that “the question is whether people owning the brand have the ability to reinvent it”. The bigger issue may be that as Sir Richard monetises his assets, several different sets of people are given the ability to reinvent the brand differently.

Inconsistency is the arch-enemy of strong brands. Virgin may be present in several different categories, but by and large the consumer has a singular concept of what values the Virgin brand stands for: the consumers friend , the iconoclastic challenger – characteristics very much in the style of their concept of Richard Branson. When different people are trying to reinvent the Virgin brand in increasingly overlapping categories, the Virgins will be running amok in different disguises. Who now can control and coordinate them? And when we don’t so easily recognise them, will we trust them as much? And if the brand ceases to command as much consumer trust, is it as valuable?

Richard Branson has done a fabulous job building and rebuilding the Virgin brand over decades, but this could well be the beginning of the end. The NTL/Virgin liaison is only just beginning, but one has to speculate that the so-called Virgin might already be half-pregnant.