They did. Think back to the late 1990s and 2000s, the Virgin brand bought a bit of glamour and image to the railway. I have (non railway enthusiast friends) who were really excited to travel on a Virgin Pendolino train. Had it been an Avanti Pendolino of a Horizon Trains Pendolino they wouldn't have seen it as anywhere near as glamorous.
Don't under estimate the power of a brand.
A lot to be said for this and something I don't think traditional rail folk like and DfT simply don't get. Brands have power and trust and that, whatever the reality, goes a long way unless it truly is destroyed (see P&O's debacle as a good example of a powerful brand who's flushed itself down the toilet - in my experience the ships and services are generally nowhere near as good as DFDS or Stena, but P&O still had a premium and deeply routed quality image).
I don't have any particular view on Richard Branson, but I do think he waved some magic dust over the service and in my minor dealings with them it was extrordianary how deep the brand values ran through the staff, their pride and attitude. The genuinely saw themselves a cut above the rest of the market in the same way the original GNER were and Eurostar still are. And that's a good thing.
No doubt the railway manderins in DfT and unions despised this and the possibility Virgin were making a crust from it, but I thought it a sad day Virgin lost the franchise. Maybe operationally Avanti are competent and brought a few new ideas but you can't escape the feeling that the successful bidder was the 'most economically advantageous', i.e., the cheapest, so any superflous glitter that Virgin seemed to excel in, would have been the first thing to be cut.
Most people don't give a stuff about the operator and i'm still struck by the number of people who talk about 'British Rail' when talking about the railway. Virgin managed to quickly apply some youthful, fun, airline glamour which people were already familiar with, had positive sentiment of and generally liked.