Virgin and the Demise of the Megastores: A Cautionary Tale

February 27 2013

With guest blogger, Cedric Littman, The Cheese Advisor

The Virgin Megastore in Paris has closed.  There has been bad publicity, and the unions have said that there are "too many unanswered questions." One union said,  "We are in a fighting mood. We're not going to go quietly.”

This looks pretty bad for Virgin, a company that presents itself as customer friendly, even customer centric. Virgin’s brand and notoriety has been partly built upon the adventurous exploits of its founder, Richard Branson, who attempted an Atlantic crossing on a balloon and is booking flights to the moon. The Virgin Megastores were the retail face of a brand that was considered to be visionary in its day.

          Image via Reuters

The Virgin store in Paris was bought from the Virgin Group ten years ago, although it was imperceptible to the consumer. Why did Virgin allow its name to be used by another company over which it seems to have no control? Even worse, the company they sold it to later sold it to yet another company, so that the retail operations were further and further away from the core brand, and not under the Virgin brand umbrella and management.   

The Virgin group also sold its retail operations in the UK, the US and Ireland, and all of the outlets have closed with at least one of the parent companies going into liquidation. At its height, the French store, on the Champs Elysees, must have been a substantial asset as it was on one of the world’s most famous thoroughfares. But now one of the most visible Virgin stores, as well as the whole chain, have closed with a loss of 1,000 jobs. How did Virgin make such a mistake?  Surely they saw the demise of traditional music retailing on the horizon, otherwise why would they have sold their retail operations? The real question is why they allowed the new owners access to the Virgin name, logo, store design, and brand equity.

This cautionary tale makes it clear that brands equity should be protected by a little, or a lot, of forethought. Even those of us with smaller brands need to take control and take charge of our brand. We may not face the same problems as the Virgin Group and we may never sell part of our operation, but good brand management is key no matter whether you are a solopreneur, a small business, a non-profit or anyone who puts a product or service or offering into the marketplace. As Beth often says in her talks, perception is all. There is the fact of your brand (where you really are in the marketplace right now) and then there is where your audiences think you are. Although they are a thriving company, the closing of the Virgin Megastores (albiet by a third party) would leave their audiences with the perception that the company is out of step with their needs, and that the business itself is in trouble.

The message: Protect your brand equity. Learn how to do it from an expert, and then don’t forget to continue to pay close attention to your brand as time goes on. After all, you have too much to lose. 

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Pinning for Money and Fun in the USA and abroad

February 21 2013

How many of you are on Pinterest these days? It has become a vital tool for those of us who are highly visual, or in a visual profession, and who want a fluid and easy place to park their online image “scrapbook” for easy reference. Personally, I’m obsessed with it! In a funny way, I find that how I approach collecting images on specific topics and areas on Pinterest has much in common with the way that I edit photography for portfolios, books, websites, etc. I like to begin with a huge pull of images, frequently in the many hundreds, and then I am able to tunnel down into the core visual through-line in a photographer’s work. Now I'm doing the same for myself, and it’s a pleasurable exercise in collecting and editing.

Many American brands and retailers are also very much on board with Pinterest. In interviews, they state again and again that Pinterest is driving sales in a quantifiable way that they don’t necessarily see in other social media. It allows consumers to paste and share products in an appealing way, and to go back to their scrapbook, have a holistic view of the things that they love, and then to easily purchase the products they’ve pinned. Sometimes it’s not so easily quantifiable, as consumers frequently use Pinterest as a research tool which might then indirectly drive a purchase through looking at their own, or other pinners, collection of aspirational fashion or home décor or design images. Pinners are also repinning other images they find on Pinterest, or pinning from all over the online universe. Magazines have a strong roll to play in this environment, as they provide a great source of many aspirational images that then drive a more down-to-earth purchase.

Interestingly enough, in the course of my own time spent in pursuing images for my Pinterest board, I’ve found that it’s really difficult to pin from European home décor magazines. Whereas most American magazines have made a major push into providing ancillary and original content on their websites, most of the European magazines I visited online are far behind. They seem to see the online environment as one in which they should hold back content and force (or frustrate) the consumer into buying the print magazine. I’m curious to know how that’s working for them. Is World of Interiors more successful at retaining their print subscribers with their opaque website than a comparable magazine like Architectural Digest, which is making at least some content of value available? I don’t know, but I can say that in the new Pinterest world, I find myself more interested in interacting with brands that make my pinning most inspirational and easiest. 

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Anthropologie: A Faux Heritage Brand Hits the High Street

February 12 2013


          Anthropologie Regent Street's living plant wall, Image via

Major lifestyle and clothing retail chain Anthropologie, with over 147 stores in the U.S., and six in Canada, operates only two stores outside of North America—both in London. That’s a far cry from parent company Urban Outfitters, which racks up an impressive twenty-five UK locations, plus sixteen others throughout Western Europe. Catering to the universal teenaged fast-fashion set, Urban Outfitters has been able to easily make a name for itself within the European market. Anthropologie’s two London locations are fairly new, and are definitely an experiment for the brand.  So why the “pessimistic economic predictions” on the opening of the London locations from

A love of heritage brands is ingrained in British sensibility—from the royal family to Liberty of London, which has maintained its position as England's premier department storesince 1875. Liberty is still selected each year by the readers of Time Out London as the top shopping destination in the UK. So as a faux-heritage brand, one wonders in what way Anthropologie will be able to find a place in a country with actual heritage. In the U.S, vintage is a longstanding trend, as shoppers and merchants either connect to our real shared past or fabricated an idealized sense of what it means to be an American. Hence the success of Ralph Lauren and Tommy Hilfiger, two brands that have constructed billion dollar businesses around the beauty and romance of what America never has been, but aspires to be. 

So why bring a faux-heritage mall brand like Anthopologie to Britain? First off, their girlish, embellished, romantic clothes and lifestyle items do fit in well with how British woman dress, and live. A friend there recently told me that his mom and her friends are starting to flock to Anthropologie. These women "get" the brand. They want pretty, and decorative.  On a certain level, it's also an investment brand, as this part of Americana does not come cheap. Antrhopologie is coming up against British high street brands with a more contemporary sensibility, so there may be a place for them in the market.


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