virgin case study key terms

Adding Value

Adding value is where a business decides to add a certain extra to their product or service so that they can sell it for more money but the extra thing added must be so that the consumer is still prepared to pay the price that the product or service has been raised to. Added values can be real or perceived; tangible or intangible. An example of this from the case is that when Virgin Atlantic started it it was just a normal airplane service but Richard Bransondecided that adding value would be useful to the company and so he decided to only sell his service to a specific market niche, that being the upper class people who would be prepared to pay a lot more as long as the service that was provided was of much better quality than those from other service providers. Branson decided to provide limousine journeys to and from the airport to the customers house or hotel and also on board the plane was only first class, so higher market consumers were attractedby the better quality of the airline than other airline. So Virgin was diversifying from its rivals.