How Tesla stands strong in the Competitive Market
Tesla, Inc. was formerly known as Tesla Motors was founded in the year 2003 and it only began being profitable in 2013. It is mainly based on Palo Alto, California and focuses on solar panel manufacturing, lithium-ion battery energy, and electric vehicles. Elon Musk, who is the CEO of the company foresees Tesla as a technology company and an autonomous automaker that aims in providing affordable electric vehicles to average consumers.
Segmentation, targeting, positioning in the Marketing Strategy of Tesla
At the time of segmenting the market, Tesla didn’t ask about a segment that is the most fuel-conscious but which segment enabled the company to create long term and innovative model vehicles. It didn’t opt for the small car segment. The segment of choice was the lower volume, the price-insensitive performance-car segment that enabled them to develop a brand identity, create premium pricing and earn significant unit gross margins by aiming at the rich and affluent who are willing to spend more as compared to their vehicles.
Since 2015, Tesla is in selling an all-electric luxury SUV, which has done relatively well in the market and has delivered a record of 100,000 vehicles for 2017. Tesla’s different positioning in the car market is one of the major strengths. Tesla not only deals in car selling but it also sells technology. The positioning statement of Tesla was “the only stylish car that can go from 1 to 100 in 3 seconds without a drop of oil”.
Mission and Vision
The mission and vision statement of Tesla reveals the aim of the company for governance in the international electric vehicles and battery market.
Tesla’s mission statement: “to accelerate the world’s transition to sustainable energy”.
The vision statement: “to create the most compelling car company of the 21st century by driving the world’s transition to electric vehicles”.
Tesla wants to hasten the initiation of viable transport by making the products accessible and affordable to a large group of people that ultimately lead to clean transport and clean energy production. Tesla mainly focuses on getting persuasive and compelling mass market electric cars to market as early as possible.
Competitive advantage in the marketing strategy of Tesla:
- Driven by Technology
Tesla is more of a technology company than an automotive company and builds technology platforms. The company is not only selling cars but it has also built a structure that is essential to support the action of those cars. It has built the network of superchargers, battery swap stations, and service stations.
Tesla is on the path of delivering complete autonomous driving capability earlier than many cars manufactures by leveraging billions of miles’ worth of driving data that Tesla has been collecting.
- Tesla’s Reputation
Reputation is considered to be one of the intangible strengths of the company. Tesla’s roadster transformed the image of electronic vehicles from small slow vehicles, into blindingly fast vehicles of desire. Tesla then produced the cheaper model S sedan that landed up winning just about every bug auto award. With the reputation for excellence, it has framed an impressive brand image.
- Diversifying its business
Tesla seems to be spreading its industry and entering into the market of Solar roof tiles as it complements with the business of rechargeable lithium-ion battery that provides a home with the storage of solar captured energy.
Distribution strategy in the marketing strategy of Tesla
Tesla mostly makes use of the online sales model attached to company-owned stores to sell its cars and doesn’t use the predictable dealer network. The company owned distribution is apprehensive with so many challenges. The justifiable amount of money is set up for a distribution channel. There are other manufacturers that include Ford, and general motors club together with the third party to sell their vehicles. For Tesla, the brick and mortar store works as a network through which the concept of EV can be sold. The company’s selling cost has been reduced by the online sale of vehicles. The physical stores only act as the showrooms for Tesla. There are around 17 stores all over the world to sell its cars which according to Tesla helps in interacting with potential customers.
Brand Equity in the Marketing strategy of Tesla
Tesla has market support of nearly 60 billion even after constantly failing to meet the productions targets of the year.
As a brand, Tesla is more than a car manufacturer, it is an image of the future. CEO, Elon Musk, himself, is the face of the brand for Tesla. Have your ever thought why is it impossible to separate Elon Musk’s brand from Tesla? It depends upon how responsive he is to the Tesla users. User experience has always been as the priority of Tesla that helped in shaping public perception of the brand.
In the USA, still, Tesla rules the EV market. Tesla sold three of the country’s five of the bestselling EV’s. Toyota’s Prius Prime plug-in hybrid and General Motors’ Chevy Volt are the competitors of Tesla.