Tesla Inc.’s Marketing Communication

Introduction

Tesla Motors is an electric vehicle manufacturer based in the United States. Millions of individuals throughout the world favor their automobiles. According to research, “it is no surprise that after the initial presentation of their new model Tesla 3 in March 2016, Tesla registered more than 250 000 preorders in just three days” (Falát & Holubčík, 2017). From the standpoint of external elements, such as marketing communication tools, Tesla maximizes its competitive advantages.

Marketing Channel System

Tesla recognizes that how they communicate with consumers is critical to their success. They aim to get as close to their target clients as possible. In order to optimize the efficiency of marketing communication for each section of customers, they utilize various marketing communication methods for different potential segments. Marketing communication is a method of delivering targeted information to clients quickly and most effectively. A company’s well-designed marketing communication can predict an increase in the number of clients, which is frequently a significant component in sales growth. On the other hand, costs are associated with developing a marketing concept into a final form that targets clients.

Comparing other automakers, Tesla works uniquely. Tesla uses a direct distribution method because it works directly with each customer. Tesla may keep its salesforce and handle all channel functions this way. Tesla, like most automakers, has suppliers from whom it purchases raw materials, but unlike others, it assembles all of its automobiles under one roof. Tesla also maintains an exclusive distribution strategy because they are the sole retailer of their product, which sets them apart from most manufacturers. Tesla sells its automobiles using an online sales approach as well as company-owned storefronts. Customers interested in the Model 3 may learn more about it on the company’s website or visit a company-owned store to view it in person. Product experts work at Tesla’s company-owned stores and are well-versed in the company’s vehicles and those of its rivals. Furthermore, unlike traditional auto salespeople, Tesla’s specialists are not paid on commission, so they will not pressure a customer to buy a vehicle. It shows that the Tesla company uses a vertical marketing channel to meet consumers’ needs.

Purpose of the Product

Tesla products are primarily for people who follow technology; the type of product is actual, related to a material object, and has physical quality and design. The company is trying to add new functionality to attract new consumers and update its car lineup. Tesla products are available for everyone to buy, but car prices can be prohibitive for some people.

The Interconnectedness of Marketing Channels

Domestic car sales, car manufacturers, and distributors use gift-giving methods to conduct marketing, usually during holidays or celebrations. Car manufacturers to launch new cars, car manufacturers, and distributors, giving various gifts to buyers feel that the low price has been taken into account, get the benefit, and then increase consumers’ desire to buy cars. In advertising, vehicle manufacturers use commercial media to draw the attention of many customers to the use and quality of products and the brand image. Car manufacturers and buyers will benefit from the use of this commercial vehicle. Manufacturers rely on promotional materials to promote their products. Consumers rely on advertising through both conventional media and webcasts. Promotional information delivered to individuals offers a handy vehicle guide. Tesla singled out the primary type of promotion for itself – social networks. If the company supplements this powerful type of promotion with advertising campaigns, discounts, and various events related to the company and its products, Tesla is making great strides in the promotion.

Product

Tesla makes autos, electric vehicle components, batteries, energy storage, and solar panels, among other things. In addition, the company is constantly introducing new products. They also install solar panels and batteries for both residential and commercial customers. Because of rising demand and innovation, Tesla focuses more on its electric vehicles as it seeks to expand as a multinational and worldwide firm.

Place

Over the years, the sites where they exhibit their products and services have remained consistent. The most popular places to locate them are corporate-owned storefronts, official company websites, business-owned service facilities, and charging stations. They are also located in a few shopping malls for convenient access to the general public. They function as a showroom and a way of showcasing their products in public locations through vehicle displays. Customers’ automobiles can be fixed and maintained at Tesla’s service centers. It also adds to their sales technique of simply dealing with their automobiles’ services. Tesla uses its social media presence and website to provide an online purchase experience that allows for car customization and delivery.

Promotion

Tesla’s marketing strategy primarily focuses on viral marketing and employs personal selling, public relations, sales promotion, and direct marketing techniques. They use social media as a primary source of earned media. Elon Musk, the company’s CEO, uses Twitter to communicate with followers and publish tweets that are generally lighthearted, including memes and personifying the company’s marketing image. He is also candid about the firm’s failings, making the firm more human and attracts customers’ attention. Tesla employs public relations to increase consumer recognition by releasing its open-source patents as part of a push to promote sustainable energy. They deploy salespeople in their stores to advertise their components and batteries through personal marketing and direct marketing. Tesla does not spend much money on advertising since word of mouth is one of its most vital promotional tools, thanks to its strong brand identification and media presence, particularly on social media.

Price

Tesla’s price benefits both the company’s earnings and the public’s opinion of the company. When the firm was first starting as a niche differentiation, it used premium pricing. As they shifted to a Broad differentiator strategy, they employed premium pricing and flexible price points for their variety of autos. Customers want high-performing technology that is not available in any other product; therefore, higher price increases strong price points. They also employ market-oriented pricing, which employs reduced prices for their newer automobile model 3 and their other items, such as solar panels and services. All of their transactions are completed online, which sets them apart from other automobile firms and is also a cost-cutting technique.

Conclusion

Tesla began as a niche differentiator for premium cars and is now bringing the market down with a broad differentiator approach. The company uses earned media and online sales sites to stage its marketing efforts, while automation, supplier ties, and research distinguish its products. Their purchase of SolarCity was a significant step forward, allowing them to expand into new areas such as ecologically friendly solar power. Thanks to practical human resources and an overall quality management approach, its inventive, hardworking culture drives its performance in the different markets and arenas. All of their transactions are completed online, which sets them apart from other automobile firms and is also a cost-cutting technique.

Reference

Falát, L., & Holubčík, M. (2017). The influence of marketing communication on financial situation of the company–a case from automobile industry. Procedia Engineering, 192, 148-153.

Appendix

Visual map of the intermediaries in Tesla Inc. system
Visual map of the intermediaries in Tesla Inc. system
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