Well did you see it? I’m sure you did! Last week Tesla showed off their answer to the transport truck, the Tesla Semi. This brand-new automobile looks like something out of the future, and it definitely looks sleek and shiny compared to the transport trucks that are on the road now. Everyone knew that it was only a matter of time before Tesla put their sights on the trucking industry. They have been disrupting the personal automobile industry for a few years now, and the trucking industry is a natural target for a greener and more energy efficient alternative to the diesel-guzzling large tractor trailers that dominate the industry now. And while Tesla’s attempt at disrupting another portion of the automobile industry is not necessarily new to most people, it may be surprising to note that Tesla is disrupting another area of the automobile industry…marketing! When you think about it, most of us know about Tesla and what they offer. Every media outlet covered the release of the Tesla Semi. The opinions and pursuits of Tesla’s billionaire visionary founder Elon Musk are well reported and always newsworthy. However, when was the last time you saw a Tesla commercial on tv? Where is the Tesla dealership in your hometown? If you’re having trouble answering these questions, you are not alone! Tesla does not use the same marketing strategies as other car manufacturers. Most of its stores are not traditional car dealerships, but rather they are small stores or kiosks in malls that sell Tesla branded items like hats and T-shirts. It does not have a Chief Marketing Officer. And for the most part, it does use paid tv, radio, or other advertisements. Instead of doing what every other automobile brand does, Tesla looked at what would be the best way to sell cars and did that instead. Below are some of the things that we can learn from Tesla’s approach to marketing their cars.
- Tesla uses its stores to get their brand in front of people, not to sell to people.
Instead of placing large dealerships in industrial parks, Tesla puts their stores in malls where thousands of people walk by day-after-day. When you think about it, how many times have you gone to the mall for one store, but ended up going to ten others during the trip? Probably all the time! Now, how often have you gone to a store and then found yourself going to a car dealership on the same trip because it was on the way? Probably never! Tesla realized that it needed to get in front of as many people as possible and be as visible as possible, which is not the standard for other car companies. In fact, a lot of people avoid car dealerships because they do not want to be approached by a pushy salesperson. Tesla does not sell any cars at their stores, it merely informs customers and promotes the brand. If you want to buy a car, you have to do that online.
2. The CEO is its spokesperson Let me ask you a question. Who is the CEO of Ford? How about GM? Honda? Ya, I have no idea either! Unlike other car companies, most people have heard of Tesla’s CEO. Elon Musk is a well-known billionaire who is always trying to come up with new companies that can better the world, often times with radical and far-fetched ideas. These efforts are well documented, and Elon Musk is seen as a visionary, so when he talks, people listen. Elon Musk knows this, and he is constantly giving interviews and making public appearances. He knows that by being a visible CEO and talking about what he is up to next, his brand will benefit from the spotlight as well.
3. The value of the product is well-known, so Tesla focuses its marketing effort on awareness Everyone knows that fossil fuels are not good for the earth. We all know that electric cars are a better alternative to cars that use a standard combustion engine. I’m sure that most people would like to have an electric car because it not only saves the environment, but it saves on expensive gas prices. Therefore, the value of a mass-produced electric car that is comparable in price to a car that runs on fossil fuel is already well-known. This is not to say that Tesla does not need to market, but rather it does not have to focus on the same marketing goals that other car companies do. The value of an electric car is obvious, so instead, it promotes the vision that every driver on the road right now could be using an electric car by trying to overcome the idea that this is some futuristic pipe dream.
4. It built the most expensive models first. Tesla’s goal was always to make every car on the road an electric car. However, Tesla knew that it did not have the budget to do this early on. Instead, Tesla created an expensive version that it knew only wealthy people could afford. Building and selling the expensive model first did two things. First, it created hype about the brand and it also acted as a proof of concept for building a mass-produced more affordable electric car later on. Second, the revenue from this high-priced model allowed Tesla the funds to go ahead and manufacture lower priced models that are within the price range of the average car buyer. The expensive model was never expected to appeal to the average car buyer, but it did set the foundation financially and create a demand that allowed Tesla to manufacture an electric car that is available to every driver on the road.
Conclusion In conclusion, Tesla decided to market their products by using a store as a marketing space, and not a selling space. It had their CEO work double duty as a spokesperson and used his celebrity status to build the reputation of the brand. It built a product that was already known to provide value, so it focused its marketing efforts on making the reality of electric cars appear as realistic as possible. Finally, it built the most expensive version first, which created demand for cheaper models and also created a revenue pipeline that allowed for the production of a cheaper model that would be more appealing to the general car buying public.