Virgin Group
Introduction
• Virgin is looking to invest in two new pillars of growth.
• Virgin has limited capital and needs additional sources to fund growth.
• Should Virgin continue aggressively investing in the health/wellness sector and retail financial services sector?
Answer:
Virgin should continue to aggressively invest in both the health/ wellness sector and retail financial service sector.
• Health/ Wellness: prior success with Virgin active and potential market opportunities.
• Retail Financial Services: Virgin One’s prior success with RBS and opportunity for expansion.
Health and wellness
1) Prior Success with Virgin Active
• Sociological shift towards more health-conscious consumers
• 13 years of uninterrupted profit growth
a) Sociological Shift
• Aging population
• Spend more on health care
• Fragmented society
• Health-consious
b) 13 year of profit
• Fastest growing Virgin company
• Quickly became international gym chain of 194 health clubs
• Largest Virgin company in health sector in terms of revenue
2) Potential Market Opportunity
• British government opens up health care to private sector
• Teaming with Assura Medical, a well established, credible health care provider
a) Private Health Care allowed
• 100 billion Euro business
• Grossly underserved
b) Team up with Assura Medical
• Well- established brand with over 3 million patients
• After 2009’s 4.4 million Euro losses, Assura Medical is projecting 27 million Euro revenues in 2010 with Virgin
• Virgin has a majority share of 75%, offering fresh capital, additional management, and operational resources
Retail financial services
1) Virgin One’s Success with RBS
• Were able to establish brand in that sector
• Rented RBS’s customer base and infrastructure which allowed for IT flexibility and creativity
a) Established Brand in Finance Sector
• Gained management experience
• Grew understanding from customer perspective
b) Established Infrastructure
•...