Five minutes with giffgaff founder Gav Thompson

by Vikki Chowney on 29th June 2010

Post image for Five minutes with giffgaff founder Gav Thompson

giffgaff is a recent arrival in the UK – a ‘virtual’ mobile network operator using O2′s network that rewards its customers for helping to run the service (we covered the launch back in November) – so we were keen to find out from the man behind it all how it’s all been going since then…

Inspired by The Times’ ‘two emails’ interview segment, we racked our brains for what people would really want to know from Gav Thompson, giffgaff‘s founder (and head of brand strategy at O2 we should add) about its creation – then asked him.

Was there a specific turning point at which you thought giffgaff would be a great idea?

I was sitting in San Francisco in 2008 at a Web 2.0 conference, rather bored, and doodling in my book. At the conference, I had been impressed by the case study of President Obama’s campaign (that was still running at the time) managing to successfully activate communities via the web. Twitter was also on the agenda, but a few hours in, I was zoning out while hearing about endless big brands that were rather clumsily jumping on the bandwagon. The idea for giffgaff did literally fly into my head, and I wrote down ‘mutual, simple and fair’ as the three founding principles. My initial idea was to call the brand “2O”, as a reversal of “O2″, and to announce it’s origins in Web 2.0, but I was quickly persuaded that whilst my business idea was great, my name idea wasn’t!

My years in advertising (N.B. Gav was responsible for the legendary Guinness Surfer ad while at Abbott Mead Vickers BBDO) taught me to keep things simple. The founding principle of giffgaff is one word; mutuality – and that is exactly what the ancient Scottish word giffgaff means, mutual giving.

A still from *that* Guiness Surfer advert

So is there a specific target market?

We don’t define our target audience in the classic demographic terms, as we think there are bits of the giffgaff idea that can appeal to different age groups or conventional segments. The desire for a simpler mobile brand relationship, the belief in the power of the community, and the willingness to get involved online and get rewarded for doing so, are aspects that appeal to many different types of people. Our youngest active member is 13, and the oldest is 77. Some of our members are on our forum helping other members out 6 hours a day, 7 days a week. Some engage less, but do their bit by telling their friends how good giffgaff is, and some just get cheaper mobile calls and texts but don’t really engage at all.

Was it an easy job to persuade O2 let you start GiffGaff? What are they getting out of it?

The O2 business development guys and I spent a fair amount of time developing the business case and doing lots of consumer research, and we finally presented the finished proposal to the O2 and Telefonica boards in early 2009. They said yes straight away.

O2 were forward-thinking enough to acknowledge that for a small, but important, minority of people, any big mobile brand – be it O2 or anyone else – isn’t really what people want. These customers want a different type of relationship with brands, in mobile and everywhere else. O2 and giffgaff are suitably different not to be treading on each other’s toes.

Is this really an attempt to create a new MVNO model, or just clever marketing spin?

In simple terms, all we have done with giffgaff is spot a trend and applied it to a mobile network. I don’t really think that’s clever marketing spin, I think it’s just a very open and transparent idea. We have a live Twitter feed on our home page that shares all views of us, good and bad, and all of our members’ views on us are available for all to see on our forum. As we have no contracts, people have the ultimate voting tool; their feet.

Why not simply integrate the concept for giffgaff into O2?

We did look into that, but decided it was wrong for O2 and what the brand is all about, and could compromise the success of giffgaff too. O2 is all about helping customers with the full suite of connectivity services, wrapped up in 24/7 customer service, aimed at the widest variety of customers with a huge range of needs and wants. giffgaff is much simpler than that, and is proud to acknowledge that the giffgaff model isn’t right for everyone.

Is there any backlash from within O2 about giffgaff’s anti-establishment approach?

giffgaff's latest ad campaign

Our anti-establishment approach reflects some very real feelings of some of the customers that we designed giffgaff for. But, at the same time, it is also intentionally tongue-in-cheek. Our colleagues at O2 totally understand what giffgaff is about and who we are targeting, and are confident enough in their own business to be comfortable about us having a little dig at the traditional mobile establishment.

giffgaff is run by CEO, Mike Fairman, as an independent business, in a separate office, in a different town, with a totally different team of people, many of whom have never worked for O2 or in mobile. Mike and his giffgaff team make their own decisions for what is right for giffgaff and the community, and some of those decisions aren’t the same ones that O2 would make for their customers, but there is certainly no backlash or bad feeling between the 2 companies. I think O2 see giffgaff as their cheeky little cousin.

What’s the uptake been like so far in terms of usage and what are the plans to grow?
Do you aim to have ‘x’ amount of users by the end of the year for instance?

It is challenging launching a new brand in the highly congested UK mobile market, and we have made things particularly difficult for ourselves by launching one with a low marketing investment model! However, our members are so involved (e.g one of our members ‘ragnorak’ recently earned over £750 from helping out other giffgaff members over the past few months), that we’re confident that our primary growth driver of happy customers passing on word of mouth recommendations about our little brand, will lead to a successful and sustainable business becoming a genuine alternative to the major mobile players for many years to come.

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