Individual Assignment as a part of the brand management course taught by Prof. Sameer Mathur at IIM Lucknow to understand brand extensions of the 'Virgin' brand.

1. Prepared by: Under the guidance of:
Harsh Chordia PGP31264 Prof. Sameer Mathur
Are there any
boundaries to the
Brand Name?

2. About Virgin
• Started by Sir Richard Branson in 1970 as he begins to
sell records by mail-order under the name ‘Virgin’ as a
way to cover costs for his magazine ‘Student’ started
in 1968
• The name Virgin was adopted by Branson and Nik
Powell as they considered themselves virgins in
business
• Today one of the biggest conglomerate with a well-
recognized brand name and operations spanning
diversified businesses & geographies
• Operates in product areas such as travel, lifestyle,
money, healthcare, music, people & planet, alcohol,
entertainment, hospitality, energy, communications
and charity among others

3. Virgin’s Brand Strategy
Extend into categories
where consumer needs are
not well met and do
different things – and do
them differently – to better
satisfy customers
Sir Richard Branson

4. Quality Fun Value for money
Innovation
Brilliant Customer
Service
Competitively
challenging

5. 1970 – Virgin is born
1979 – Virgin Megastore, Virgin Books, Virgin Films
1983 – Virgin Games, Virgin Vision
1984 – Virgin Musicbox, Virgin Atlantic Airways, Virgin Cargo
1985 – Virgin Holidays 1987 – Virgin Records America, Virgin Unite, Virgin Airship,
Virgin Balloon Company, Mates Condoms
1988 – Virgin Classics, Virgin Hotels,
Virgin Broadcasting
1991 – Virgin Publishing
1993 – Virgin radio
1994 – Virgin Vodka, Virgin Cola, Virgin Retail, Virgin Vacations
1995 – Virgin Direct
Personal Financing
Services
1996 – V2 Music, Virgin.net, Virgin Rail Group, V Festival, Virgin
Brides
1997 – Virgin Trains, Virgin Cosmetics
1998 – Virgin ActiveTimeline of Brand Extensions
1972 – Virgin Records Label

6. 1999 – Virgin Mobile, Radio free Virgin
2000 - Virgin Energy, Virgin Cars, Virgin Money, Virgin Blue, Virgin Wines, Virgin Australia
2001 – Virgin
Experience 2002 - Virgin Bikes
2003 – Virgin Pulse
2004 – Virgin Galactic, Virgin Unite, Virgin Games
2006 – Virgin Fuel, Virgin Comics 2007 – Virgin Media, Virgin America, Virgin Earth
Challenge, Virgin Green Fund
2008 – Virgin Charter
2009 – Virgin Health Bank, Virgin Mobile
FreeFest
2010 – Virgin Racing, Virgin Gaming, Virgin Produced, Virgin Limited Edition,
Virgin Care
2011 – Virgin Oceanic, Virgin Mobile Live, Branson Centre of Entrepreneurship
2015 – Virgin Sport, Virgin
Trains East Coast
2014 – Virgin Pulse
2012 – Virgin Money Giving,
Virgin water purifier
2013 – Virgin
Startup
Timeline of Brand Extensions

7. Ansoff’s Growth Matrix
Market
Penetration
Strategy
Product
Development
Strategy
Market
Development
Strategy
Diversification
Strategy
New
Existing
Existing New
Products
Markets
Virgin typically follows the
diversification strategy – new
products in new markets, the main
reasons for which are:
• Efficiency gain
• Increased corporate parenting
skills
• Increasing market power
among other brand extension
advantages discussed in the later
slides.
One other important reason for
Virgin’s diversification strategy is
the founder Sir Richard Branson’s
vision – his ideas and interests

8. Ansoff’s Growth Matrix
Market
Penetration
Strategy
Product
Development
Strategy
Market
Development
Strategy
Diversification
Strategy
New
Existing
Existing New
Products
Markets
Examples of Diversification
strategy:
• Virgin Megastore
• Virgin Atlantic Airlines
• Virgin Holidays
• Virgin Mates condoms
• Virgin Vodka and Virgin Cola
• Virgin Mobiles
among others

9. Ansoff’s Growth Matrix
Market
Penetration
Strategy
Product
Development
Strategy
Market
Development
Strategy
Diversification
Strategy
New
Existing
Existing New
Products
Markets
Virgin is based out of UK and
started a lot of its businesses in UK
before expanding to new
geographies
Examples of Market Development
strategy:
• Virgin America and Virgin
Australia (extension of existing
Virgin Atlantic)
• Virgin Mobile India (extension of
Virgin Mobile)
• Expansion of products/services in
Japan in 1990
among others

10. Ansoff’s Growth Matrix
Market
Penetration
Strategy
Product
Development
Strategy
Market
Development
Strategy
Diversification
Strategy
New
Existing
Existing New
Products
Markets
Virgin has also developed new
products for the same existing
market utilising it’s brand name
Examples of the product
development strategy:
• Virgin Trains in UK
• Virgin Brides in UK
• Virgin America (after Virgin
Records America)
among others

11. Ansoff’s Growth Matrix
Market
Penetration
Strategy
Product
Development
Strategy
Market
Development
Strategy
Diversification
Strategy
New
Existing
Existing New
Products
Markets
The market penetration strategy is
when a company grows its existing
offerings in existing markets
Examples of market penetration
strategy:
• Acquisitions of ShapeUp and Global
Corporate Challenge, competitors of
Virgin Pulse
• $1000 cashback by Virgin Atlantic on
Upper Class flights
among other price discounts, increase
in promotions & distributions and
acquisitions by Virgin

12. Brand Extension Matrix
Line Extension
Category
Extension
Flanker Brand New Product
New
Existing
Existing New
Product Category
BrandName
Most of Virgin’s brand extensions are
actually category extensions – existing
Virgin brand name in new product
category
Examples of Category Extensions by Virgin:
• Virgin Megastore
• Virgin Atlantic Airlines
• Virgin Holidays
• Virgin Jeans
• Virgin Vodka and Virgin Cola
• Virgin Trains
• Virgin Mobiles
• Virgin Brides
among others

13. Brand Extension Matrix
Line Extension
Category
Extension
Flanker Brand New Product
New
Existing
Existing New
Product Category
BrandName
There have been a few cases where
the brand extensions have been
simple line extensions
Examples of line extensions –
• Virgin Charter (of Virgin Atlantic
Airlines)
• Virgin Publishing (of Virgin Books)
• Virgin Gaming (of Virgin Games)
• Virgin Mobile FreeFest (of Virgin
Mobile)
among others

14. Virgin Print and TVC ads
The above image depicts billboard ads which were changed every week (as
highlighted by the yellow box) and the characters are shown growing
beards to bring across the main message – “Holidays so affordable, you can
stay for ages.”
1.
2.
3.

15. 4. 5. 6.
7.
8.

16. 9. 10.
11. 12.

17. Virgin Print and TVC ads Analysis
As seen, each of the ads – print (numbered 1-8) and TVC (numbered 9-12) -
focussed one or more of the following parameters:
• Quality of product/service – 3, 4, 5, 6, 8, 9, 11, 12
• Fun – 1, 2, 3, 4, 7, 8, 9, 10, 11, 12
• Competitively challenging – 6, 9
• Brilliant customer service – 5, 6, 8, 11
• Value for Money – 1, 5, 6
• Innovation – 1, 2, 7, 9
Each of the ads are for different product categories, but strongly
associate with what the ‘Virgin’ brand stands for and further
clarify the brand meaning to the customer

18. Advantages of brand extensions for Virgin
Facilitate new product
acceptance
• Reduced risk perceived by customers
• Increased probability of gaining
distribution and trial
• Increased efficiency of promotions
• Avoid cost of developing a new brand
• Reduced marketing costs
Feedback benefit to parent brand
& company
• Improved brand recognition
• Clarify brand meaning
• Enhanced brand image
• Improved market coverage
• Revitalize the brand

19. Disadvantages of brand extensions for
Virgin
• High risk on image of parent brand, as bad experience
with one product may drive away the customer from
all other products
• Negative impact of failed of failed extensions on
parent brand – a point brought forward by critics time
and again
• A few of Virgin’s not-so-successful brands include
Virgin Cola, Virgin Vodka, Virgin PCs, Virgin Jeans,
Virgin Brides and Virgin Clothing
• No clear connection with a particular category – in
critics’ words, “Virgin would mean everything to
everyone, but in essence, may end up meaning
nothing to someone”
• A few confused and frustrated consumers
What is Virgin doing to overcome
these disadvantages?
• Trying to become more disciplined in recent years
• New extension strategy in place – Pursue new
business only if they are expected to generate more
than $150 million in sales within 3 years
• Greater emphasis on environment and sustainability
• New Mission – “to contribute to creating happy and
fulfilling lives which are also sustainable”

20. SUMMARY
Virgin’s brand strategy and
brand meaning
Analyse the brand
extensions using
Ansoff’s growth matrix
and brand extension
matrix
Evaluate the fit of
print and TVC ads
with Virgin’s brand
image
Advantages of
brand extension
Disadvantages of
brand extension
Ansoff’s Growth Matrix
Brand Extension Matrix

21. Sources
• Based on the branding brief ‘Are there any boundaries to the Virgin Brand Name?’ – Pg 440-
41, Strategic Brand Management Textbook by Keller et al.
• https://www.virgin.com – Slide 2
• https://en.wikipedia.org/wiki/Virgin_Group - Slides 2,5,6
• https://en.wikipedia.org/wiki/Timeline_of_Richard_Branson%27s_business_ventures –
Slides 5,6
• http://www.timetoast.com/timelines/life-of-richard-branson-virgin - Slides 5,6
• http://www.pocket-lint.com/hub/virgin - Slides 5,6
• https://adsoftheworld.com/taxonomy/brand/virgin - Slides 14,15 -> Ads 1-8
• https://www.youtube.com/watch?v=AdGQ43smLoc – Slide 16 -> Ad 9
• https://www.youtube.com/watch?v=mb4gyT_mKOc – Slide 16 -> Ad 10
• https://www.youtube.com/watch?v=6cM4EOeJzHA – Slide 16 -> Ad11
• https://www.youtube.com/watch?v=g1eT10oRJIE – Slide 16 -> Ad12
• Prof. Sameer Mathur’s slides

22. These slides were prepared
as a part of the course
‘Brand Management’
taught by Prof. Sameer
Mathur at IIM Lucknow
Marketing Professor 2009 – 2013
Ph.D. and M.S. (Marketing) 2003 – 2009
Marketing Professor 2013 – Present
Indian Institute of Management, Lucknow
DISCLAIMER
PGDM Student 2015 - 2017
Indian Institute of Management, Lucknow
Prof. Sameer Mathur
Harsh Chordia