Thinking like Branson
by Andrew on 26/06/06 at 12:18 pm
8 comments
This Blog is entitled “Thinking differently about business”, and nobody encapsulates that better than Richard Branson and Virgin. This weekend they launched Virgin Money and Virgin Mobile in South Africa. I heard Branson on Cape Talk this morning, and it sounds like he’s hit the nail on the head with these products. Here are some paraphrased highlights from the interview:
Mike Wills - Does South Africa need another Credit Card company?
Richard Branson - Do you pay annual card charges? Do you get a decent interest rate on positive balances? Do you get 3 months free interest? I think you guys need another Credit Card company.
Mike Wills - But why choose South Africa? Is it worth your time?
Richard Branson - We choose to enter markets where consumers are getting screwed over by monopolies that have been taking too much profit from consumers. We would never enter the US market because they already have low-cost Mobile Phone and Credit Card companies.
Branson acknowledged that they are usually the late-comers to an industry, which means they have the advantage of seeing the problems that exist and making them right. It looks like they have identified the pain that South Africans feel regarding cellphone companies and banks, and they have tailored their offering around those things. Here are some examples of their benefits. I’m sure you’ll find yourself nodding in agreement!
Virgin Mobile:
- Real per-second billing, from the first second.
- No 24 month contracts. If it doesn’t work out with your girlfriend, do you stick around for 2 more years?
- No extra monthly costs, caller-identity, sim card insurance.
Virgin Money:
- No annual fees.
- Free Lost Card Insurance.
- Free Online Banking.
Branson said that Virgin single-handedly brought down the cost of cellphone use in the UK. In South Africa we have effective “duopolies” by the big 4 banks and 3 cellphone companies. Here’s hoping an outsider can truly shake things up!
Andrew Smith is the pedantic systems guy behind Live Alchemy, a SA e-commerce company. Andrew writes for Ideate in an attempt to make the world a more efficient place. View more articles by Andrew.
Shane
Jul 10th, 2006
I have been attempting to apply for the credit card. Three attempts on the online application, two phone calls and one email – and still nothing. Promises to get back to me…you know the usual stuff. They have been swamped with applications and they have admitted to being totally unprepared. Quite a thought – big spend on marketing campaign and very little on actual delivery. A common SA problem unfortunately.
Andrew
Jul 10th, 2006
I can never remember which way round the saying goes – do people get bad service in South Africa, or bad service in the UK?
Perhaps Branson’s team set up the marketing effort from the UK (eg zip-lining through Sandton) and expected the local service delivery arm to perform better than they have been.
Unless they fix things quickly, they’re going to lose the momentum.
steve
Jul 19th, 2006
my mate got the card, but couldn’t use it at the toll booth the other day. Pretty disapointing.
Brett
Aug 10th, 2006
I can’t believe he can lie so blantantly and get away with it. He says and I quote: “We would never enter the US market because they already have low-cost Mobile Phone and Credit Card companies.”
OMG this is an outright lie, Virgin Mobile launched there a few years ago?! http://www.virginmobileusa.com/.
Andrew
Aug 10th, 2006
Interesting point Brett. I guess I took his word as truth without investigating. Perhaps his company has become so big he didn’t even know that had happened? (Unlikely I know, but such is the power of Branson’s brand that I’ll do my best to defend him).
Brett
Aug 10th, 2006
Nah he’s alot sharper than we think. Behind his whole flamboyant daredevil image lies a calculating, attention to detail, win at all costs freak of a businesman.
Have u watched “Thank for Smoking”? I think that sums it well. These guys are kings of spin. They will sell at all costs and if needs be sometimes that means spinning the truth ever so slightly!
Don’t get me wrong the mans one of my idols but still I cant believe he can lie so blantantly.. haha its pretty classic actually. When you get to that level of success I think everyone including the guy interviewing you and 99% of the listeners/readers/views just go “aha” and nod their heads. I can’t wait to get that stage it must be fantastic!
melody
May 23rd, 2007
Virgin Mobile and Virgin Credit cards are new companies, the fact that you have to pay R135.00 for a replacement card is not good, the cards are of such horrible quality. I wish i never became involved with both companies as i have had no joy with either. Vey dissapointing….
Johan van Wyk
Sep 11th, 2007
07 September 2007
Dear Sir Richard Branson
Thank you for receiving my e-mail. I am from South Africa, and a Virgin Money Card holder. I am writing this as a business proposal to you.
Virgin Money is an affiliated partner of ABSA Bank South Africa, and this is what the proposal is about. We currently have the ABSA Bank off road racing in our country, and I saw an opportunity to enter a Virgin Money off road racing team. I think the advertisement for the Virgin Group would be of great value, as ABSA Bank will then advertise their own team.
I haven’t got the finances to do so and therefore seek your assistance in doing so, if possible.
I think this sums it up in short.
Please think about this and let me know.
Regards,