Virgin Hotels – Show me the Big Idea !

Posted on September 26, 2010

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Virgin announced on September 20th the launch of the latest addition to its portfolio of brands: Virgin Hotels. So far, the group has reportedly over 300 branded companies, covering everything from mobile phone operator, financial services, Megastores and Formula 1 racing to soft drink, space tourism and, most notably, airlines.

After a failed launch in 2008, Virgin Hotels is in the initial stages of approaching existing properties in North America. The hotels shall be mid size — 150 to 400 rooms, depending on the market.
I have tried to find out more about the plans or at least an embryo of a concept but there is almost none beside the classics. All I could find was a quote from Sir Richard Branson: “Contemporary style, great functionality, they will be the hippest most comfortable new hotel in any city. Anyone’s who anybody will know to go there.” Fairly vague to say the least…

Where is the Big Idea?

At this stage, there is no concept to the Virgin Hotels brand. It is an empty shell. It is only an idea. If you browse quickly through the brand website you will see that it is an opportunistic venture exclusively relying on the potential desire of existing hotel owners or developers to “own” a piece of the Virgin brand and relying on a strong consumer desire to experience a new generation of hotels.

Anthony Marino, Executive Director of Virgin Hotels is not saying anything different. “We polled a group of recent travelers and something like 70 percent said they would stay in a Virgin Hotel,” Marino said . “We felt like we could make an impact.” No doubt that the opportunity is immense but the higher the expectations the higher the risk…

Several brands took the same path

Capitalizing on an existing successful lifestyle brand to launch a new hotel concept is not new. Many have done it. Hard Rock, Bulgari, Swatch, Armani etc. (Here is a piece I wrote on the subject a few months ago).
The only difference is that all these brands stayed true to their original branded concept and drilled it down into compelling hotel concepts. Staying true to the irreverent Virgin / Branson brand image will be the key.
Also relevant to note that the launch of the Virgin Hotels brand will be done mostly through franchise and management contracts, well known to be hotel brands best enemies. How can Virgin makes sure to stay in total control of its brand unless the company own the assets at the launch stage?

What makes all of us desire the Virgin brand?

From a pure branding point of view, Virgin is a UFO. There is no logic to it and doesn’t follow any rule. Virgin is NOT a great concept. It is only a great brand… Paradox.
If you analyze some of the Virgin sub-brands, they actually rarely revolve around a unique Virgin core concept. The only thing they have in common is a unique ability to be quickly desired and quickly make a name for themselves.
Why? Because we like Richard Branson. Because we all want to be Richard Branson. Successful, rich, unique entrepreneur, free to try, free to fail, free to fly, free to dress, free to think and free to speak up. Branson didn’t aim for success; he just did what he loved and believed in. Success came naturally.
Virgin is the ultimate example of the personification of a brand. We consume Virgin to get closer to this ideal Branson’s way of life.

So far, launching Virgin Hotels is a great idea, but where is the Big idea?

Uncle Ben said: “With great power, comes great responsibility”. Virgin has a tremendous power but also has a great responsibility to stay true to its mission statement: Delivering Unforgettable Experiences to Customers that are Expecting Nothing Less but Breakthrough Innovations and Excellence.

The closer we will get from the opening of the first Virgin Hotel the higher the expectations from the market are going to be but, as I said earlier, what makes Richard Branson a unique entrepreneur is that not only he is free to do what he wants but he is also allowed to fail.

Fabrice Burtin – September 2010

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