How far can EasyGroup push its brand?
EasyGroup, the brain child of Sir Stelios Haji-Ioannou, has launched myriad of brand extensions over its 23 years of existence. Established to expand the ‘Easy’ brand following the successful launch of airline EasyJet in 1995, the group has since ventured into entirely new categories: gyms, car rental, hotels, office space and coffee, among others.
Now EasyGroup has added three new businesses to its family of UK-based brands. With EasyFood, the group hopes to take on the food delivery sector, while with EasyTaxi it is eyeing up the ride hailing and taxi market. And finally, in a more unexpected move for the brand, it has decided the enter the marketing industry with the launch of an agency, EasyMarketing.
The food delivery market is now worth an estimated £11.4bn in the UK, double its market value in 2015, according to Lumina Intelligence. Meanwhile, Statista estimates that 17.8 million people in the country were using ride hailing and taxi services last year.
However, both markets are notoriously competitive in the UK, with a number of major players already battling for dominance. In food delivery, Just Eat, Deliveroo and Uber Eats are in fierce competition, while in the taxi market, Uber is grappling with competition from Bolt and Free Ride. Notably, the likes of Deliveroo, Uber and Bolt have never turned a profit.
But the co-founder of all three new Easy brands, Jeewan Sagu, believes EasyFood and EasyTaxi will be able to undercut their rivals and give them “a very big run for their money” as they enter the market, winning consumers over with the values inherent to the easy brand.
It’s all about right to play and right to win. Often easy does have a right to play because its philosophy is no frills, low price, which can apply to a lot of categories.
Helen Edwards, Passionbrand
“Our brand ethos is all about no frills, value for money,” he tells Marketing Week. Sagu claims to be able to cut costs through lower overheads, no call centres and inexpensive advertising. Those cost savings are to be returned to the customer, with EasyFood offering a fixed service fee no matter the size of the order.
Brand consultant and director of Passionbrand Helen Edwards explains that brands like Easy or Virgin can, in theory, take their brand to any category as the brand itself has a meaning that isn’t category specific. Where easy focuses on value for money, Virgin homes in on providing good customer experiences.
An Easy offer in both the food delivery and taxi categories “make sense”, she says, adding that she expects EasyFood to get a high trial rate among customers, who have no reason not to try the service if it offers the same or similar food at a lower price.
Similarly, while it feels unlikely that Uber can be undercut on price, EasyTaxi may have an opportunity to tackle some of the weaknesses in the Uber brand, particularly around issues such as trust.
It comes back down to our brand promise and making sure that we don’t jeopardise the brand in any way.
Jeewan Sagu, EasyGroup
“It’s all about right to play and right to win,” Edwards explains. “Often Easy does have a right to play in these categories because its philosophy is no frills and low price, which you could apply to a lot of categories.
“But do they have a right to win? That will be all about whether they are perceived as having the competence to be able to do it, and some categories will lend themselves to that more than others.”
When Virgin launched The Virgin Cosmetics Company in 1997, for example, Edwards says it was doomed to fail as the master brand didn’t have any credentials in the beauty category. EasyGroup underwent a similar experience with EasyCinema, which the business closed in 2005 after three years.
However, with Easy’s transport credentials from EasyJet, delivery and taxi services will likely pique consumer interest.
With EasyMarketing, however, it’s more difficult to establish why the brand would have the right to win, Edwards says. EasyGroup is primarily a consumer facing brand, offering services in transport, travel and leisure, and while it does offer some B2B services, a marketing agency is certainly a diversion from its norm.
However, Sagu says the Easy brand name has been “massively useful” for the new agency. “Consumers are business owners,” he says. “It doesn’t matter what your background is, or whether you own one business or a million, you’ve come across the Easy brand.”
Familiarity with the brand is so strong, Sagu continues, that he finds people often think they’ve come across EasyMarketing before.
‘You’ll be out of business in six months’: How EasyJet proved the doubters wrong
“We’ve not been here, there’s no way you’ve seen us before, but because of the brand power of Easy, people already relate to it. They’ve already got that trust factor with us,” he says.
The marketing agency’s primary focus is on using its buying power as part of the Easy brand to secure cost-effective media rates for small businesses. Initially it was focused on providing this service to the thousands of restaurants partnering with EasyFoods, but is now expanding to take on new clients of various sizes.
Sagu says the business will “create a level playing field” for brands with less buying power, while also offering “straight talking, simple marketing where there’s no confusion”. On top of media buying, the agency will offer app and website development, PR services, branding work and content creation.
Far from weakening the master brand by spreading into new and unexpected areas, Sagu believes it all contributes towards creating awareness. “If you recognise the brand when you come across it, you know you’ve got that gold standard,” he says.
Delivering from the start
However, while brands like Easy and Virgin may have the right to play and to win in many different categories, they have to deliver a strong offer from the start or risk immediately losing customer trust and interest, Edwards advises.
“Every category has its own set of competencies that you’ve got to be able to get your arms around, as well as – if not better than – the competition,” Edwards says.
It’s a challenge Sagu is all too aware of. He founded EasyFoods two years ago, but getting it out into the market has been a slow process as the business ensured it “ticked all the boxes”, got everything right and prepared for this month’s full launch. Over 1,000 restaurants are now available via the mobile app in the Midlands alone, he claims.
“It comes back down to our brand promise and making sure that we don’t jeopardise the brand in any way,” he says. “So we didn’t do a premature launch.”
Because of the brand power of Easy, people already relate to it. They’ve already got that trust factor with us.
Jeewan Sagu, EasyGroup
However, Edwards says that if the businesses do fail, it is unlikely to damage the master brand.
“People forget quite quickly,” she says. While the marketing industry remembers The Virgin Cosmetics Company as a cautionary tale, consumers most likely don’t. This is especially the case when a group brand has one flagship business which is considered a leader in its category, as EasyGroup and Virgin have with their airlines.
Nevertheless, Easy does not have free licence to expand into any category, she reiterates, as success is dependent on gaining an initial trial with customers. Like Virgin Cosmetics, Virgin Bride never got off the ground for this reason.
“That doesn’t look good from a consumer point of view, but I don’t think it damages the master brand that much. But it does seriously damage your credibility to your shareholders.”
The important thing for EasyGroup is that it moves on quickly if the outlook begins to sour.
“It almost seems to be part of Easy’s brand that they try things, they fail and they move on,” Edwards says. “So long as they move on quickly and don’t keep trying at something that’s clearly bad, as you don’t want to have consumers saying for years that easyJet is okay, but their delivery service is rubbish.”