Who’s Afraid of the Big Bad Wolf?

Context

Billionaire entrepreneur Sir Richard Branson may have carved out a niche for himself in popular culture with his sky-high publicity stunts. In the world of business, he’s known for taking on “big bad wolves”.

This phrase refers to his strategy of sniffing out underserved markets, challenging complacent “wolves” – companies that overcharge and underdeliver – and offering consumers a better way forward.

Branson places a premium on experimentation, constantly launching fresh ideas based on customer feedback and swiftly iterating – or, at other times, pulling the plug – on those that don’t fly. In fact, one of his failed ventures, designed to lock horns with the industry titans, taught him a hard-earned lesson on maintaining a higher purpose while disrupting industries for the greater good.

What makes Sir Richard Branson a remarkable WarTime CEO?

Real-Life Story

In 1994, Branson set his sights on shaking up the beverage industry with Virgin Cola, aiming to take down global behemoths Coca-Cola and Pepsi. He and his team thought that going after the industry giants “would be a lot of fun”.

This overconfidence led Branson to launch Virgin Cola with all guns blazing, including an audacious marketing stunt where he drove a tank through Times Square. But the “rebel billionaire” failed to fully appreciate the size and strength of his rivals.

Virgin Cola leaned heavily on Branson’s rebellious image and was priced to undercut its major competitors, hoping to win over budget-conscious shoppers with a promise of similar quality. With only a slight improvement in taste, the product struggled to stand out. Meanwhile, according to Branson, his competitors fought back by allegedly convincing distributors and retailers into keeping Virgin Cola off the shelves. The brand’s ability to break into key distribution channels was stunted. Major retailers – unimpressed by poor sales – began dropping Virgin Cola. 

And although Virgin Cola carried a strong brand name, the product itself lacked a compelling reason for consumers to make the switch.

Branson later admitted that entering such a fiercely competitive market without a distinct strategic edge was a serious misstep. However, he bounced back from the Virgin Cola debacle by embracing an “underdog” mindset – a stance he believes fuels resilience and innovation.

The experience taught him to focus on businesses that could truly set themselves apart from competitors and make a real difference in the market.

From then on, Branson started asking the hard-hitting questions before diving in: Can this venture outshine the competition? And more importantly, will it leave a positive mark on the world?

His failed venture proved the value of understanding market dynamics and what truly resonates with consumers, shaping the future strategies of the Virgin Group. 

Branson and his team realised putting purpose at the heart of their ventures was essential. Every new initiative needed to be more than just a business – it had to truly matter to consumers and stand the test of time.

PostScript: Despite the failure of Virgin Cola, the Virgin Group continued to break into new markets, from commercial space tourism with Virgin Galactic to cruise shipping with Virgin Voyages and hospitality with Virgin Hotels.

Virgin Galactic, in particular, embodies Branson’s renewed focus on innovation and purpose, offering experiences that are out of this world, both literally and figuratively. This commitment to thinking big while learning from past mistakes is the lesson Branson carried with him from the Virgin Cola saga.

Key Lessons

1) Adapt – or abandon quickly

Branson’s willingness to swiftly pivot or pull the plug on failing ideas is a key survival trait. WarTime CEOs are agile, constantly iterating based on feedback, and prepared to cut losses if a strategy or product doesn’t work.

2) The underdog mindset fosters innovation

Branson embraced the role of the underdog, using it as a source of resilience and creativity. In times of crisis, WarTime CEOs cultivate an underdog mentality to fuel innovation and outmanoeuvre entrenched competitors.

3) Understand your enemy  

Virgin Cola’s failure was a lesson in underestimating the competition. WarTime CEOs have a deep understanding of the market and their rivals’ strengths, preparing not just for attack, but also for counterattacks from established players.

4) Bold moves demand strategic precision 

While bold actions like Branson’s tank stunt in Times Square generate attention, they must be backed by solid strategic positioning. WarTime CEOs balance audacity with careful planning to ensure their actions yield sustainable results.

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Until next week, may the force be with you.

Kevin

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