Megan Beard / Q79730558/CCA502

How successfully does Virgin Atlantic Airways, Investor Relations Officers

communicate performance and success to other key Virgin Stakeholders?

Virgin Atlantic Airways Investor Relations Officers necessitate the requirement to

communicate performance not only to shareholders but also to all Virgin Atlantic

stakeholders. Virgin Atlantic’s performance and success can be determined by flight

efficiency in relation to runways, customer sales/tickets purchased destinations and Jets

supplied. ‘Stakeholder analysis is a clear way of defining those groups and individuals who

have a significant relationship with an organisation and those with a vested interest in

organisations operations’, Tench and Yeoman’s (2009, pg. 105). Virgin Atlantic has a large

quantity of stakeholders and it is the Investor Relation Officers job to communicate

information what they know best to everyone involved in the Organisation. To get the voice

of Virgin Atlantic heard the Investors need to begin by setting out who to communicate to

and how. The Virgin Atlantic stakeholder map (see appendix a) gives a detailed list of who

the stakeholders are. Obviously, the main target for the investor relations team is investors,

but every other stakeholder group will be interested to some degree about how the

company is doing in terms of financial performance. The second part to this process will be

determining which channel is used to communicate with each stakeholder group.

To successfully communicate with Shareholders in an Organisation, the most effective way

is through an annual report. The law requires this; however, most Organisations go the extra

mile to reveal their performance but also involve their Corporate Social Responsibility.

Financial PR increasing importance is reflected in the Economist statement: ‘to keep share

price up, it is no longer enough merely to have a strategy. The strategy also needs to be

articulated smartly as any manager at BT, Ford or Marconi tell you,’ (The Economist

2001:75). This suggests Organisations have increasing pressure to develop their annual

reports to the highest standard. As the investor relations team is aiming at keeping investors

informed, who the investors are is crucial. In the case of Virgin Atlantic, this is actually quite

easy, as it is not listed on a stock exchange, and is owned by only two investors- the Virgin

Group and Singapore airlines. So, there is no legal need to publish an annual report. That

said, other stakeholders need to know about the organisation's financial performance,

which the Investors should communicate efficiently. Cultip et al (1994) 7 c’s of

Megan Beard / Q79730558/CCA502

Communication 5) Channels: different channels should be used for reaching different target

audiences. Different channels are associated with different values and this should

considered by the public relations practitioner.’ This emphasises the need to use the correct

channels to communicate effectively to each stakeholder group as the wrong channel may

cause the audience to receive the information in the right form.

Customers

Customers are an important stakeholder in your organisation as they are the key group to

benefit from the organisation as you aim to sell your product towards and drive your sales

to result in great performance and overall profit. As customers drive the sales of an

organisation, they have the right to know how well you are doing, as they are a contributing

factor to performance. The investors of Virgin Atlantic use different channels to

communicate with their customers. ‘The internet continues to gain ground as the preferred

means for companies to manage registered shareholders accounts’ (trade journals, 2003),

even though this is aimed towards providing financial information online for shareholders

via annual reports, this also relates to using the internet as an effective channel to

communicate services. Virgin Atlantic communicate most successfully with stakeholder

group by using channels such as their online travel website (www.virgin-atlantic.com), blogs,

social media and the Virgin group website as a whole (www.virgin.com).

The Virgin Customers who travel with them can find information in terms

of performance on the travel website. Assessing

the depth of information (figure1) the website

provide for Customer stakeholders, shows

Virgin only use information in regards to

facilities, upper class on board services,

operation and biofuels. This may seem like a

variety of accomplishments, however it does

not measure the values or sales in performance

that customers can evaluate, for example how

well they are doing in contrast to last years

sales to compare performance. Customers can

Figure 1: History of

Virgin Atlantic’s success

Megan Beard / Q79730558/CCA502

be directed to the ‘our fleet’ section of the Virgin Atlantic website to see the quantity of

airplanes Virgin fly and can take a look at the capacity and seating arrangement. Customers

can also be seen as a part of the Community stakeholder group, with this is mind Customers

will care about the environment around them, however are not supplied with a channel to

provide performance information. Customers care about how well a company are doing as

they require a stable relationship with an airline to secure their customer service to Virgin

Atlantic and come back again. Customers rely on performance information to ensure they

can trust a business and if they are not supplied with performance material they may doubt

the business and go elsewhere.

Suppliers

Virgin Atlantic provides Virgin Cargo fuels however have recently partnered with Boeing

saying ‘we have partnered with Boeing to help us in our quest to become the most

sustainable airline in the world. We ordered 15 787-9 Dreamliners in April, which burn

around 27% less fuel per passenger than the A340-300 they will replace. We will also be

doing a biofuel demonstration with Boeing, Virgin Fuels and engine maker GE Aviation

during 2008 which will be the first worldwide by a commercial airline.’

Other partnerships they have

made are with Fair-trade, by

supplying this as alternative

Tea on-board flights and have

also teamed up with Tesco and

their Club card incentive, to

earn air miles. However these

new partnerships and supplier are not provided with their own channel of communication

with Virgin Atlantic in ways that other stakeholders are. With this in mind, lack of

communication with a group of stakeholders can be crucial to building trust and furthering a

relationship for future business. Suppliers are just as important as any other stakeholder

and need to be informed on performance and success if they are contributing to the

business, for example; Boeing will be relying on Virgin Atlantic delivering on their

Figure 2:

http://www.facebook.com/virginatl

antic

Megan Beard / Q79730558/CCA502

performance as this is vital to their performance too. To determine the performance of

Virgin Atlantic, the supplier must be provided with a means to view this information;

however the Virgin Atlantic Investors fail to do so.

Media

The most significant media effect is seen to be the role that media play in an audience’s

social construction of meaning. The media offer their

messages and meaning to audiences. It is

then up to the audience how they read the

message (McQuail 2000, p.g.228). The

media is an influential source and

stakeholder that can further your

exposure. If they are given the right

information they can cover this via their

resources. To communicate with the

media to cover your news many elements

can be used such as blogs, websites or

magazines.

Virgin Atlantic has a successful

communication strategy with the media as they provide them many options to view their

performance and success. Primarily they include a Press Office page (figure 3) on their

website for journalists to turn to. Here they provide journalists with press releases with

performance information regarding new fleets, additional services and worldwide success.

This appears to be a successful way to communicate with journalists as it cuts the function

of telephoning or email.

Another useful channel for Media stakeholders to access is ‘Richard’s Blog’ via the Virgin

Groups website. The blogs supply information on what Virgin as a whole is doing and more

specifically what Virgin Atlantic are doing. These blogs can provide easy reading information

for all members of the Media stakeholder group whether they are personal bloggers, online

journalists or local/national press. Information that can be found relates to Airline Staff

contributions, landing slots and expansion as a whole. This means of communication can be

Figure 3: Press Office page

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easily retrieved, with a flavour for Virgin Atlantic with a visual outlook; however lacks in-

depth information on facts and figures about performance overall.

Public Affairs

S, Cain (2009, Pg. 174) says stakeholders within Publics affairs are those who are ‘involved in

the public policy-making, legislation and regulation, which may affect the interests of

organisations and their operations.’ Virgin Atlantic must communicate with these

organisations and regulators to provide with the evidence to support how they implement

their rules in business.

Law ensures all requirements are kept to by an organisation and

enforces regulations. Virgin Atlantic

communicates with stakeholders from the

Public affairs group, regarding performance

mainly through a Corporate Social

Responsibility PDF file available from the

Virgin Group website. The 2011 CSR report

informs Politicians and Regulators with

information about Reduction targets and

history for example ‘Virgin Atlantic were the

first commercial airline to use biofuel in

demonstration flights.’ Boasting these

statics, Virgin can successfully communicate

basic information through this channel to show their achievements and what they set out to

accomplish. Building the reputation of the airline with politicians is crucial and financial

performance is imperative. Virgin Atlantic has a high media profile and Branson has views

on things like landing slots, competition etc. that are influential, so keeping the image of

Virgin Atlantic as successful is important to its public affairs work as they need to monitor

the strengths and weaknesses of Virgin Atlantic, in terms of environmental performance.

This particular means of communication supplies Public Affairs stakeholders with a great

amount of information of Virgin Atlantics performance with statistics they would find

Figure 4: Flying High CSR

Report

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Figure 5:

Environmental page on

Virgin Atlantic website

successful and satisfying. These statistics include: Emissions, Global policy, fuel and

Operational efficiencies.

Another group within the Public Affairs stakeholders are activists, who are important

stakeholder group as they are passionate about the environment, especially when it comes

to the Airline industry. Virgin Atlantic can use their CSR report as a key channel to

communicate with activists as it contains all the essential information they require to show

how ‘green’ they are. The CSR report gathers information on the success of Virgin Atlantic

including fuel types and emission’s as touched upon above.

An additional channel that communicates to Public Affairs stakeholders is the Environment

section on their official website. This specific channel is not effective in itself as it lacks any

precise information on the website. Furthermore a sustainability

report can be downloaded through this channel which gives a

detailed report on aviation. As well as producing

information regulators or activists are passionate about,

Virgin Atlantic also provide information on how ticking

all the boxes in reference to aviation through emissions,

waste, water and supplies etc. show how these

resources have gained strengths in the business and

helped develop performance and success. This

downloadable report gives Virgin Atlantic a positive

image on sustaining Publics Affairs stakeholder’s needs

and likewise successfully communicates to them.

Employees and Community

The Employees and Community of Virgin Atlantic can withhold the reputation and face of

Virgin Atlantic as well as be the main stakeholder to be effected by them also. As a

proportion of the Community stakeholders will be the surrounding local, national or

worldwide communities of the Airports Virgin fly from, they call for awareness of the

performance of Virgin Atlantic concerning building work, influence on Community events,

Carbon emissions and expansion, which all equate to the overall performance Virgin Atlantic

Figure

Megan Beard / Q79730558/CCA502

aim to achieve. With these factors in mind, the Community require the performance and

success information of Virgin Atlantic to ‘give the go ahead’ or agree to any plans they have.

‘An institutions relationship with its neighbours in its community are crucial because these

neighbours supply the organisations workforce, provide an environment that attracts or fails

to attract talented personnel…if angered impose restraints on the institution,’ Cutlip et al

(1985, p.g.52). Employees need to feel secure in their job and having information supplied

to them via specific channels will make them feel safe, to know Virgin Atlantic are doing well

and keeping a strong performance to secure their jobs. In addition employees of the local

community for example, Gatwick Airport community will also be interested in the work of

Virgin Atlantic as it may affect the way they work. This can be seen through a personal

experience in Gatwick Airport, as Virgin Atlantic set out to change its conveyer belt system,

and were required to move from their original zone to desks one zone along. Virgin Atlantic

faced a communication problem as passengers would be directed by signs to the original

zone. Virgin Atlantic failed to communicate with their passengers and finally called in an

outside team to communicate with their customers, from the Airport community

employees. This affected the way the outside team worked and all employees of the airport

as passengers/customers would approach any member of the airport for directions. As

Virgin Atlantic failed to communicate the situation, it caused further problems creating a

domino effect on the community and employee stakeholder group. This situation proves

how powerful a simple communication channel can easily solve a problem, where

stakeholders need information to resolve a problem.

Furthermore, Virgin Atlantic supplies a Corporate Social Responsibility (CSR) report, in PDF

form on the Virgin Group website for Employees or members of a Community to access.

Firstly, this channel of communication can be hard to find from the main website itself,

unless ‘Virgin Atlantic CSR report’ is typed into a search engine to locate this information

itself.

Figure 6: Google Search engine

results. www.google.com

Megan Beard / Q79730558/CCA502

Figure 8: ‘What Virgin is up to

around the World’

When directed to the Virgin Group website, the CSR report is available under the name

‘flying high.’ This PDF contains highlights of Virgin Atlantic and other Virgin Group’s airline

companies. This gives the

Community and Employee

stakeholders the opportunity to

investigate Virgin Atlantics social

responsibility activities in terms of

fuel and emission which are

important. Virgin refers to the local

Airport Communities personally in

their CSR report (figure 6). This part

of the report communicates to Community Stakeholders the performance of Virgin Atlantic

over a period of time, showing how Investor Relations can transfer success, without

mentioning any financial factors. On the other hand Employees will feel satisfied to know

Virgin Atlantic are growing as a business and increasing to secure their jobs, in terms of

acknowledging Virgin’s performance through expansion and use of resources. For example

a more visual channel Virgin Atlantic has communicated to the worldwide community and

Employees is through a map (figure 8) on the Virgin Groups Official website called ‘What

Virgin is up to around the World.’ This map gives a vague outlook of how Virgin Atlantic is

contributing to the Carbon footprint, fuel use and value of

employee contribution estimation. This again

communicates what they are doing through

performance and is an extra way to tell

Employees and the Community how

successful Virgin Atlantic is.

Figure 7: CSR Report

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Conclusion

The research concludes Virgin Atlantic Investor Relations team communicate Performance

successfully to only a handful of stakeholder groups, suggesting some stakeholder groups

necessitate information more than other groups. All stakeholder groups are as important as

another and require a channel to provide information, proving that Virgin Atlantic do not

communicated effectively to all stakeholder groups as a whole. The communication

channels are seen mainly through the Virgin Atlantic and Virgin Group Official websites,

showing Virgin Atlantic are lacking further channels and resources of information to

communicate with. The content in these channels communicate very effectively the

performance Virgin Atlantic has undertaken, without producing any major financial statistics

they could illustrate, if they obtained an annual report. The research taken suggests the

Investor Relations team needs to begin to address their channels of communication when it

comes to communicating performance and success to all stakeholder groups, the content of

information incorporates positive and effective material, but needs to be communicated to

all stakeholder groups and not just a minority.

Megan Beard / Q79730558/CCA502

References

Tench and Yeomans, Exploring Public Relations, 2nd edition, (2009 pg.105), Pearson

Haig, M, E-PR, The essential guide to Public Relations on the Internet, (2000 pg.120), Kogan

Page limited, London

Wragg, D, Targeting Media Relations, (1993. Pg.101), Kogan page limited, London

Cain, S, Key Concepts in Public Relations, (2009, pg. 174), Palgrave Macmillan, Hampshire,

England

Editorial Staff, 2003, Trade Journals, Investor Relations business, [online], 1, [accessed

15/12/2011] Available from search.proquest.com

Megan Beard / Q79730558/CCA502

Appendix A.

COMMUNITY

SUPPLIERS

SHARHOLDERS/

INVESTORS

CUSTOMERS

MEDIA

REGULATORS

Megan Beard / Q79730558/CCA502

SHAREHOLDERS

SINGAPORE AIRLINES

THE VIRGIN GROUP

RICHARD BRANSON

www.virgin.com

http://www.singaporeair.com/SAA-

flow.form?execution=e2s1

Megan Beard / Q79730558/CCA502

AIRPORT

COMMUNITES

SURROUNDING

AIRPORT

COMMUNITIES

http://www.gatwickairport.com/

http://www.heathrowairport.com/

http://www.orlandoairports.net

http://www.horleysurrey-

tc.gov.uk/

http://www.holidayextras.co.uk/

in-and-around-heathrow.html

http://www.crawley.gov.uk/stell

ent/idcplg?IdcService=SS_GET_P

AGE&nodeId=25

http://globalvoicesonline.org/20

11/01/03/cuba-las-charangas-

de-bejucal/

COMMUNITY

Megan Beard / Q79730558/CCA502

TRAVEL

ONLINE/WEBSITE

CUSTOMERS

http://www.statravel.co.uk/travel-help-

new.htm

www.tripadvisor.com

www.virgin-atlantic.com

www.expedia.com

www.twitter.com

www.facebook.com

www.tumblr.com

www.flickr.com

SOCIAL NETWORKING

CUSTOMERS

CUSTOMERS

Megan Beard / Q79730558/CCA502

LEGISLATORS

ACTIVISTS

http://www.caa.co.uk/default.aspx?catid=503

http://www.faa.gov/regulations_policies/

http://www.hse.gov.uk/pubns/hsc13.pdf

http://www.asa.org.uk/

http://aviationjustice.org/tour/

http://www.airportwatch.org.uk/

?p=4656

http://www.planestupid.com/cat

egory/blog-tags/virgin

http://www.1010global.org/uk

http://uk.oneworld.net/guides/e

nvironmentalactivism

http://www.infrastructure.gov.au/aviation/le

gislation/index.aspx

http://www.aviationlaw.eu/

http://www.hg.org/aviation-law.html

PUBLIC AFFAIRS

REGULATORS

Megan Beard / Q79730558/CCA502

ONLINE MAGAZINES

BLOGS

JOURNALSTS

MEDIA RELATIONS

WEBSITE

http://www.ft.com/magazine

http://uk.cision.com/Resources/Social-Media-

Index/Top-UK-Social-Media/Finance-Week/Top-

25-UK-Finance-Magazines/ - below lists came

from this website – list from the top 25

http://www.cimaglobal.com/

http://www.theneweconomy.com/

http://www.moneyweek.com/

http://fw.ifslearning.ac.uk/home.aspx

http://www.theforwardgroup.com/#

http://www.airlinequality.com/Airlines/Web

_menu.htm

http://us.makemytrip.com/traveltips/links.ht

m

http://www.travelandleisure.com/articles/air

-travel-update-best-new-airline-websites

www.tripadvisor.com

http://www.smartplanet.com/blog/tr

ansportation/virgin-atlantic-to-use-

waste-gas-to-fuel-its-planes/1046

http://blog.vtravelled.com/

http://news.yahoo.com/blogs/techn

ology-blog/virgin-atlantic-promises-

help-develop-eco-friendly-jet-

011916875.html

http://blog.bookingbuddy.co.uk/virgi

n_atlantic/index.html

http://techblog.smashing.net/2011/1

1/01/virgin-atlantic-launches-all-

new-economy-service/

http://www.aero-

technics.co.uk/blog/index.php/interi

ors-contract-with-virgin-atlantic-

airways/

www.telegraph.co.uk

www.dailymail.co.uk

Megan Beard / Q79730558/CCA502

FAIRTRADE

BOEING

SUPPLIERS

VIRGIN CARGO

TESCO CLUBCARD

http://www.fairtrade.org.uk/work/news/ne

ws.aspx

http://www.virgin.com/people-and-

planet/blog/fairtrade-at-virgin-wines

http://cargo.virgin-

atlantic.com/gb/en/index.html

http://www.cargo-

overseas.co.uk/index.php/spotlight-on-

suppliers/61-virgin-atlantic-cargo-a-supplier-

of-contracted-services-to-lagos. (Virgin also

supply to other companies such as overseas

transport)

http://www.boeing.com/

http://www.virgin-

atlantic.com/en/gb/allaboutus/ourfleet/inde

x.jsp

http://www.tesco.com/clubcard/clubcard/

http://www.tesco.com/clubcard/deals/brow

se.aspx?N=4294967217+4294966541

http://www.virginholidays.co.uk/info/about/

tescoclubcard/

Megan Beard / Q79730558/CCA502

Appendix B

Debate Questions

“All Publicity is Good Publicity”

On behalf of Virgin Atlantic Investor Relations team, I am for the motion “All Publicity is Good

Publicity.” We feel that all publicity can effective your business in relation to sales and performance.

As we have such a big franchise in itself we have gained loyal customers and know that any bad

publicity can be potentially be good publicity in the long run when any issue can be turned into a

good outcome. For example in autumn 2008, Virgin Atlantic launched their new TV Advert campaign,

an entertaining advert, boasting their cabin crew and on-flight experience. After the press publishing

bad news stories about this advert, in relation to it being sexist the ASA has decided that there were

no grounds for a formal investigation and said that it 'considered that the ad was unlikely to be seen

as sexist or derogatory towards women or to cause serious or widespread offence.' Furthermore

there has been no drop in sales and performance, showing that bad publicity only produces free

publicity for the company, leading to more interest and in some cases benefiting the company as a

whole.

Niall Firth, Niall Firth, Virgin Atlantic cabin crew ad 'is sexist and offensive to women', claim viewers,

2011 [accessed:17/12/2011],http://www.dailymail.co.uk/news/article-1140618/Virgin-Atlantic-

cabin-crew-ad-sexist-offensive-women-claim-viewers.html#ixzz1gzvsw7xF

“What the public thinks does not always matter”

From an Investor Relations point of view what the public thinks does always matter and therefore

am against the motion. What the public thinks always matters as if they have a bad impression of

your business, they will not use your service. Investors rely on the sales of a company and need to

make every effort to ensure there is a return for shareholders. The public can use certain channels of

communication to share their opinions, through social networking or blogs. For example, Thompson

Airlines were targeted after a Customer and his partner were not satisfied with their Holiday

experience and furthermore their customer relations team when approaching them with their

problem. When Thompson did not respond, the customers took it upon themselves to blog about

their experience. This rant blog topped Google search rankings above the Thompson website itself.

This incident resulted in a lot of publicity for Thompson and caused customer satisfaction to drop

and their reputation was at risk from there on. This shows what the public think does always matter,

emphasising on the word always, as the public opinion will always matter on how well they perceive

your business at all times. When customer use social networking websites such as ‘twitter,’ their

opinions can go viral and create a domino effect towards the opinions of other followers.

“You don’t always have to tell the truth to the press”

The Investor Relations team at Virgin Atlantic would vote for the motion “You don’t always have to

tell the truth to the press.” As some news is essential to the business and at times may not be legally

authorised for public viewing. In reference to Virgin Atlantic as a company, we do not require to

share an annual report, as it is owned by the Virgin Group and Singapore Airlines only, so any

Megan Beard / Q79730558/CCA502

performance and sales information cannot be seen and therefore does not ‘always’ have to be told

to the press as it is not authorised information for any other stakeholder. This in fact is not, not

telling the truth, but lawfully not sharing information. A reason many companies do not talk to the

press is because the press are known for spinning and lying about news stories. Withholding

information about your company in the long run may help the press from covering a story in a

negative light, with only a fraction of the truth. Virgin Atlantic have been victimised in the past when

stories rose about ‘suspected’ price fixing agreements with another airline, Cathay Airlines. This

story was a tip-off and written as an alleged story. The press had no proof of this agreement and

went forward with releasing it anyway. Nothing came of the story and any investigations made did

not prove anything. This shows the press will do anything to make a story more exciting and lie to

get what they want, showing you do not always have to tell the truth to the press, they will lie for

you instead.

“Shareholders are more important than customers”

Virgin Atlantic Investor Relations team would be for the motion “Shareholders are more important

than customers.” When a business is born, it is created by the investors themselves. Without the

investment into a company, the company would not exist or grow. Customers would be able to use a

service from a company if it was not there in the first place, proving shareholders are more

important because without the investment of shareholders, the company would not be able to

strengthen or even exist.

Megan Beard / Q79730558/CCA502

Appendix C

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