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Running head: TESLA

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TESLA MARKETING PLAN 2

Tesla Marketing Plan

Introduction

The automobile industry in the US has a competitive market, and it is the role of every

player to ensure that their product meets the expectation of the consumers. With the changing

lifestyle, the automobile has undergone massive transformation since the inception of automobile

manufacturers the Ford Motor by Henry Ford. Over, the past few decades there have been

different new entries into this sector, one of this entry players is the Tesla Motor company. The

Tesla Motor company was founded in 2003, and it mainly focuses on producing electric car

especially the luxury sports car that uses the electric battery, unlike the traditional gasoline

luxury sports car (“About Tesla | Tesla”). The company has continued to develop and evolve its

model to compete with other brands such as the BMW, Lexus and Mercedes Benz. Over the time

it has expanded its different models ranging from the Roadster model to the model X. However,

in this essay, the discussion will focus on the Model S of the Tesla’s Luxury electric sports car.

Tesla’s Model S Target Market

One of the critical aspects that influences the success of any business is the strategy that

the company adopts. Tesla as a leading electric car manufacturer in the US has continued to

embrace a specific approach that aims at developing its product now and then (“About Tesla |

Tesla”). For example, it was the need for the improvement of their previous Roadster model that

led to the development of the Model S car. In its strategic formulation, Tesla aimed at entering

into the high-end market with its product going for premium prices specifically through offering

competition to other luxury brands such as the Mercedes Benz. Notably, the company has

managed to target the High-end market since the Model S is a sports car which is associated with

TESLA MARKETING PLAN 3

the luxury class (“About Tesla | Tesla”). Additionally, even its competitors are companies that

are involved in the manufacturing of the high-end products. Moreover, it should be noted that the

mission of the Tesla company is proving that electric cars can be far much better than the

gasoline cars. Additionally, with the objective of Model S being bringing style into the marked

confirmed that the target market was for the high-end market mainly the aim was to outdo its

model Roadster which was equated to the BMW M3 series which is a luxury sports car.

Moreover, Model S can be linked to the high-end market because it main challenger among the

electric car was the Nissan Leaf to which the clients preferred due to its price that was half the

price of the Tesla’s Model S.

Model S Marketing Mix

At the heart of Tesla was to produce a high-performance electric car, therefore, in its

marketing mix, the target was on the product enhancement. It is important to note that before the

Model S, the company had developed what was known as Roadster. This paved the way for the

company to enhance its product through integrating different aspects as a way of encouraging the

consumers to buy the new model (Huang, &Sarigöllü, 2014). For example, Model S has an

elegant design that is appealing to the consumers. It should be noted that in the US the design of

a car influences consumers preferences. Therefore, by making sure that model S was sleek in

design appealed to consumers who would previously purchase gasoline-car based on its

appearance (Liu, Li, Chen, & Balachander, 2017). Besides, the design of the model S resembled

the modern cars that mainly use gasoline thus attracting more clients to buying the electric car as

compared to the ordinary gasoline cars that have elegant designs but lack advancement.

When it comes to the pricing of the Model S, the company slightly utilized a different

strategy that would lure customers to buy its product. This is because, the cost of charging the

TESLA MARKETING PLAN 4

electric cars was relatively higher and instead of lowering the price of buying Model S, the

company introduced Supercharger stations. This entailed setting up Charging Stations across the

US as a way of encouraging customers to buy their model since they could quickly charge the

car, unlike the other electric vehicles. Besides, the Supercharger stations ensured that the time

taken to recharge was significantly reduced and was available to the Tesla’s electric cars

consumers (McPeak, & Guo, 2014). Moreover, by ensuring that the stations were available

across the US ensured that consumers could utilize the Model S across the US. This placed the

Model S at a better place compared to other electric cars. However, the primary challenge was

putting their model at a better place in comparison with other gasoline-cars simply because it is

unlikely for consumers to prefer an electric car that would take about 40 minutes charging as

compared to five minutes refueling of the gasoline. Additionally, as the company is continuing to

manufacture more electric car models, the pricing strategy as well has significantly transformed.

For example, there has been lowering the price of their cars as a way of competing with other

electric car manufacturers such as the Nissan Leaf.

In the US, electric cars have continued to take over the automobile sector. This is because

the consumers are shifting their behaviors towards more environmentally friendly products. This

has placed the electrical motor manufacturers in a higher competitive edge (Huang, &Sarigöllü,

2014). For instance, the model S by Tesla ought to be one of the cleanliest automobiles since it

does not pollute the environment as compared to other cars that use internal combustion.

Moreover, with the Americans being attracted to innovations makes electric vehicles best placed

within the automobile industry in the US as compared to gasoline-cars whose only innovation is

mainly on design rather than the technology.

TESLA MARKETING PLAN 5

Consequently, the company has managed to promote its product to its prospective

consumers using different techniques and strategies. For example, the company has continued to

improve its product through continuous lowering of the prices while enhancing the product. For

example, the Model S was relatively cheaper as compared to the Roadster model; additionally,

Model X which is a predecessor of model S is cheaper. This has been a way of Tesla’s product

promotion of its product to its consumers. Furthermore, with the initiative such as establishing

various supercharging stations for the Tesla’s electric cars was a way of making sure that it

promoted its product.

SWOT Analysis

Tesla as an automobile company has its strengths in the ability to strengthen its position

especially given the fact that it was among the pioneers of electric cars within the high-end

market. Additionally, its strategy of establishing charging stations is a strength that poses an

opportunity for the company to enhance its competitiveness as consumers are likely to purchase

Tesla’s models due to the incentives that are brought about in charging the cars (Huang,

&Sarigöllü, 2014). Additionally, the company enjoys the opportunity of commercializing the

concept of electric auto motors. Whereby, the idea of electric motors has continued to align with

the global sustainability goals thus making the company vulnerable to global growth as different

countries encourage its population on the importance of electric cars.

However, there are some weaknesses associated with the electric cars that the company

produces mainly the growth rate of its sales projection. The company has tended to be over

ambition in regards to its growth and has continued to plan on developing its facility as a way of

enabling the company to manufacture the more electric vehicle (McPeak, & Guo, 2014).

Notably, the Model S by Tesla as compared to other models was very limited. Furthermore, as

TESLA MARKETING PLAN 6

compared to other motors such as the BMW 535d, Model S was inferior as the BMW could drive

relatively higher miles. On the threats aspect, Tesla faces increased competition from other

emerging electric motor manufacturers; as a result, the likelihood of duplication of Tesla’s model

that can be cheaper would affect the performance of the company.

Environmental Variables

The company enjoys probable growth as the US government has continued to offer

incentives to the company for its environmentally-friendly vehicle. Notably, according to

Banerjee (2017), the federal government has provided tax rebate of approximately $7000 on tax

for every electric car purchased while States have continued to encourage the development of the

electric vehicle manufacturing but offering further incentives in the form of tax rebatement as

well.

Additionally, the fact that electric cars are linked to advancement in technology, the

America population is attracted to innovative ideas thus increasing the number of sales that the

company obtains. For instance, it marked a significant rise in the number of sales of Model S as

well as increased number of deposits for the Model X electric cars. The company has continued

to address the challenges that arise from electric cars, for example, the inability to charge the

vehicle. Tesla, established supercharging stations that reduced the time taken to charge the car as

well as facilitating utilization of the vehicles all over the US (McPeak, & Guo, 2014). This has

enabled the company to grow over the past years, and consumers are now embracing usage of

the electric cars.

Conclusion

TESLA MARKETING PLAN 7

Based on the discussion, it is evident that the company has managed to improve its

performance through adoption of different strategies. This is primarily by streamlining its

marketing mix to ensure that its product is enhanced now and then, its product is placed in a

manner that it attracts the consumers for instance through the establishment of supercharging

stations made it easier for the consumers to adopt the electric cars moreover the company sells its

product directly to the consumers. Additionally, the company has continued to promote its

product now and then enhancement as well as reviewing of its pricing strategy. Furthermore,

external variables such government support through tax rebatement has enabled the company to

continue growing its presence in the US market.

TESLA MARKETING PLAN 8

References

About Tesla | Tesla. Retrieved from https://www.tesla.com/about

Banerjee, S. B. (2017). Corporate environmentalism and the greening of strategic marketing:

Implications for marketing theory and practice. In Greener Marketing (pp. 16-40).

Routledge.

Huang, R., &Sarigöllü, E. (2014). How brand awareness relates to market outcome, brand

equity, and the marketing mix. In Fashion Branding and Consumer Behaviors (pp. 113-

132). Springer, New York, NY.

Liu, Y., Li, K. J., Chen, H., & Balachander, S. (2017). The Effects of Products’ Aesthetic Design

on Demand and Marketing-Mix Effectiveness: The Role of Segment Prototypicality and

Brand Consistency. Journal of Marketing, 81(1), 83-102.

McPeak, C., & Guo, Y. (2014). How the “Go Green” trend influences the automotive industry

financial performance. Journal of Sustainability and Green Business Volume, 2.

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