BackDon’t be afraid to take calculated risks
Don’t be afraid to take calculated risks
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There’s an inherent danger in letting people think that they have perfected something. When they believe they’ve nailed it, most people tend to sit back and rest on their laurels while countless others will be working furiously to better their work.
I have always been an extremely picky consumer. Unlike most problem customers, however, I just love it when I am on the receiving end of really bad service. No, I’m not a market masochist; it’s just that some of my best business ideas have stemmed from experiencing bad service.
My first retail business grew out of my constantly being chased out of record stores when my only crime was trying to spend my precious pocket money. We opened the very first Virgin Records shop in London, determined to create an environment where kids (our customers) would want to hang out.
Back then teenagers would spend hours over a single espresso in the pre-Starbucks genre coffee bar. This inspired us at Virgin Records to throw a few beanbags around the place, crank up the volume and transform the music-buying experience into a fun trip. It’s interesting that the big book-selling chains took another 30 years to catch on.
The trick is always to look at your business or brand from the outside in. Instead of looking strictly through the prism of the latest quarterly financials, attempt to see yourself as your customers see you.
Start simply: call your own customer service line. Just finding the number can be interesting. If you’re subjecting your customers to some kind of electronic hell, redesign the system—pronto.
My close associates know that saying, “Oh, come on, Richard, that will never work," is like waving the proverbial red flag in front of a bull. Knowing this, they have no doubt used reverse psychology a few times to get me to buy into some crazy notions. But the fact that something has never been done doesn’t necessarily mean it can’t be done. Often it simply means that no one has been crazy enough to try it—usually for fear of failure.
Around the Virgin companies there really is no such thing as a dumb idea—at least not until we have examined it to see if, with some tweaking, it might be workable. Getting ahead of the curve can require improvising with short-term alternatives that fall well short of that nearly perfect nine.
For example, at Virgin Atlantic, in the mid-1980s, rather than wait for seat-back TV technology to be perfected, we went out and bought hundreds of Sony video Walkmans. Remember those? We loaded up on the latest movies on DVDs, handed them out to our fliers and, bingo, we were the first airline with personal movies in business class.
Our approach had its flaws. The batteries frequently expired before the movie finished, but that was no reason not to be the first to market. Within a year or so, when seat-back technology got to an acceptable level, we were the first airline to feature personal video screens at every seat. No one remembered the early hiccups.
Getting the jump on trends requires taking risks and having the confidence to go with your gut feeling. For instance, when we announced that our first Virgin Megastore in the US would open in New York’s Times Square, even New Yorkers thought we’d gone mad.
“Richard," I remember an American friend saying, “you’re going to lose your shirt. No one in their right mind ever goes there."
There was that red flag—again!
By the conventional wisdom, he was absolutely correct. Compared with the more fashionable locations available, Times Square didn’t rate even a four. But we had a good vibe about the place, and its less-than-prime reputation meant that the price was compelling. At the risk of making a public and embarrassing mistake, we went for it.
When it finally opened, our big, beautiful Virgin Megastore was unlike any music store New York had ever seen. It immediately became the talk of the town and, like its sister store in Paris, one of the city’s biggest tourist attractions. It was exactly the kind of retail catalyst Times Square desperately needed.
If we’d taken the safe approach and waited for the area to reinvent itself, we would never have become the centrepiece of the busiest two acres in Manhattan.
Being in Times Square boosted our brand awareness far beyond the store itself. The giant Virgin logo, flashing 24/7 above the storefront, became an impossible-to-miss backdrop to countless movies and TV shows—not to mention millions of tourists’ photos.
It was a big risk, but with an even bigger return.
Don’t be afraid to take calculated risks. Sometimes they turn out to be less dangerous than the sure thing. Come to terms with the fact that the perfect 10 simply doesn’t exist, and when you hit the nine mark, don’t stand back and admire your handiwork. Start work on the next generation to make it still better.
Then again, thinking back to the movie Ten, maybe Bo Derek proves there is an exception to every rule.
BY NYT SYNDICATE
©2010/RICHARD BRANSON
Richard Branson is the founder of the Virgin Group and companies such as Virgin Atlantic, Virgin America, Virgin Mobile. He maintains a blog at www.virgin.com/richard-branson/blog. You can follow him on Twitter at https://twitter.com/richardbranson. Your comments and queries on this column, which will run every week, are welcome at feedback@livemint.com
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