Stagnant sales
For example, Will Whitehorn, a Virgin director, recently predicted that the Virgin companies would collectively record a 60 percent jump in sales, to US$8.3 billion, by the end of 2003.
But for the last four years, sales have been virtually stagnant. He also forecast that losses, which have totaled US$413 million the last two years, would turn to profits of US$290 million this year and US$580 million next year.
Some analysts said they were skeptical that Virgin would meet those targets, given the company's flat sales, the current sluggish economy and the problems confronting the airline industry and the British rail system, areas in which Virgin has large operations.
"Unless they are planning a really big push into a new market sector, it's hard to see where the extra revenue will come from," said Rita Clifton, the chief executive of Interbrand, a global brand consultant.
Branson takes pride in not having his businesses go out of business. But some analysts wonder whether never acknowledging defeat makes good business sense. "A more astute businessman would be closing down businesses that are clearly not working and redirecting assets to the ones that are," said Alan Brew, a principal at Addison Branding and Communications in New York.
Branson's supporters say such criticism is unfair.
"The vast majority of new businesses fail spectacularly," said Ken Berry, the former head of the EMI Group's recorded music business, who first met Branson in 1973, soon after the start of Virgin Music. "Just about everything Richard does gets on the radar screen."
Some people who have worked with Branson said they were concerned that he relied too heavily on gimmicks as a cure-all for important business problems.
Flawed business sense
"Richard believes everything can be done through publicity, which isn't the case," said Chris Moss, who spent eight years as marketing director of Virgin Atlantic and is now a marketing consultant.
For instance, fresh from his days as a music maverick, Branson initially branded Virgin Atlantic the rock 'n' roll airline.
Moss, who eventually convinced Branson that the airline needed to change its advertising, said: "People want to know that the business-class seats have more room than any other airline, not that Virgin Atlantic is groovy. It took us years to recover from that rock 'n' roll image."
Likewise, the marketing strategy for Virgin Cola in the US made an initial impact when Branson drove a tank through Manhattan. But the company lacked a long-term plan to erode the market shares of rivals, said Jim Smith, chairman of Ground Zero, a San Francisco advertising agency that worked on the rollout.
"He tried to do it on the back of his own winsome charm," Smith said, "and he fell flat on his face."
Branson, who is dyslexic, says he is not one for poring over pages of spreadsheets and plotting strategy based on estimates of market share.
"In the end," he said, "it is your own gut and your own experience of running businesses."
Stock market investors, though, are likely to require more than a sixth sense before taking another chance on Virgin.
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