In France Virgin is mostly known for its "megastores", big cultural stores selling books, musics, and high tech gears. Unfortunately the company has recently shut down. Virgin megastore has been bought back in 2001 by Lagardère, but due to the crisis in the music industry, and the big shift towards Internet for cultural goods, the company has not been able to survive.
Richard Branson has sold several of its business those past few years. The equity of these companies most of the time were highly estimated due to the Virgin brand, which he spent his life building. Now a lot of these business, for different reasons have not been able to flourish as expected. There are several thoughts that comes to my mind while analysis what happened especially to Virgin megastore in France:
- Who do you maintain a global brand like Virgin while it is owned by different companies, on different market, with different interest? Building a brand is a full time job, and it requires coordination, which is impossible when the different entities composing it are independant. Maybe what has been done is a real threat to the Virgin business currently hold by Branson.
- What is the real added value of buying the Virgin brand? If your corporation is not able to bond with the brand's message, it is impossible that it works. Therefore, owning Virgin as a brand but without mastering the component of it is useless.
What would be interesting is to see what are the next plans of Richard Branson: Does he want to expand to new markets? Or will he rather focus on its top companies in order to secure the future of Virgin as a brand?