The Way Forward for Tesla Motors

The Way Forward for Tesla Motors

Tesla Motors cannot afford to rely simply on good reviews and word of mouth to boost its sales. Sure, differentiating yourself means doing things that the world's leading automakers don't. But sometimes, to be the best, you have to play like the best.

What do I mean by that exactly?

Advertising, advertising, advertising.

It is grossly lacking in that department. Take a look at Chevrolet's new commercial for its 2014 Chevrolet Impala. I may be overstating this, but I think it may be the greatest car commercial of all time. Jordan Bloch's "gallons of light" commercial for the Model S was great, but it simply does not match up to this. Step it up, Tesla.

Link is below:

gillfoto | 2013年5月16日

When the time is right a budget should be drawn up for making the general public more aware of Tesla Motors.
My personalized plate her in Alaska is 'B4TSLA', some people get it and it sure creates interest.

Yes I agree Information and Education on the technology of Tesla is really required; anytime you mention 'electric' cars there's a hundred and one 'gasoline' doubters.

So I'd propose a more 'everyman' approach in the vein of Apple; pure and simple nothing too flash.

So the basic Tesla S starts at $65K, we need to market this product to people to who realize it makes sense and that it would be a smart and wise investment, for themselves and the planet.

I could go on, but maybe not right now. ;-)

BTW: This Gen III car what does it look like, and when will it get built?

kilimats | 2013年5月16日

advertising isnt ready for Tesla, it will when the 3rd gen is out don't worry

Brian H | 2013年5月16日

The only clue so far from Elon is that it will resemble the MS, but be shorter. Steel body instead of aluminum.

TSLAholic | 2013年5月16日

The infrastructure to support the increased demand as a result of advertising is just not there at the moment. Being a new kid on the block, if demand were to suddenly pick up, Tesla had better be ready to deliver (pun intended).
Present demand within the European market alone will keep plenty of pressure on production at its current rate.
The last thing we want potential customers to do is turn away due to a lengthy wait. The game would be quite different from the "early adopter" stage, i.e. accepting of a longer wait and forgiving of teething problems etc.
I have learned a great deal about the way Elon nurtures this still newborn baby. I have a feeling when it's ready to walk, he will be right behind it with a pillow just in case.

Bubba2000 | 2013年5月17日

Tesla has gained a huge strategic competitive advantage in raising $1B. After paying of the DOE loan and hedging, its cash will swell to nearly $680M If they leave $250M as working capital, then have $430M left to invest. This money can be used to leverage existing technology and investment and achieve significant return on investment. The market has not priced any of these possibilities:

1. $25M could be spend on deploying 100 superchargers sites (4-6 chargers/station) in the US alone. Another 25 chargers could go in Europe where distances are smaller and there are widely available public chargers, especially in Scandinavia; may be another 15 supercharges in China in key locations in the main routes on the coast, etc; 10 in Japan. Total cost of US+Europe+Asia = $50M. This will drive demand significantly, especially in the US and Europe. Double current demand to 50,000 MS/year. No range anxiety would be a big bang for the buck.
2. Model X manufacturing - Tesla spend about $500M on the equipment for the Model S. I read that some of it was spend on Model X tooling ($?). I figure it will cost them $250-300M in incremental investment. I think Model X demand will exceed Model S, especially if they include a battery that is good for at least 100 KW-hr to take care of the larger load. Personally, I want a 500 mile battery!

In 2012 Porsche sold 143k cars. The SUV Cayenne at 83k sold 3x what the Panamera sold... none o them are cheap cars, especially when loaded since everything is extra. If Tesla gets the Model X battery tech right will 100-125 KW-hr by the time they sell the car in 2014, demand could exceed 50,000 worldwide. Tesla itself could produce 50,000 cars S+X. Double to 100,000 of Model S + X.

There are huge economies of scale here since fixed costs are sunk. With fully automated production, possible only with the BEV and Tesla design, there are huge economies of scale that Wall Street has not considered.

Can Elon Musk do it? YES!!!

orthophonist | 2013年5月17日

I would hire away the head of advertising for Apple and model my ads, like I have modeled my stores, after Apple's.

carlgo | 2013年5月19日

The Santana Row store in San Jose, CA is not as slick or bright as an Apple Store, not so different from other modern Porsche, BMW and MB showrooms. But, what was amazing were the crowds! It looked like one of those Toyota commercials where dozens of customers are dancing around the showroom.

Tesla could go the route of Apple's big flagship stores in important market areas, really tart the place up and light it up with twice the power of the sun like Apple does.

I would advertise some so that the average person would know something about the company and that affordable models are on the way. Whet their appetites. Then it will seem familiar and they won't have to be the early adopter type to buy one in a couple of years.

As Homer Simpson famously said: "It must be true if it is on TV".

4humanity | 2013年5月19日

80% of all sales are based on the relationships you build and word of mouth. This has been a statistic held true for many years within sales and marketing.

Advertising is really just art anymore and perhaps for top of mind awareness. On average a person has to see you 100 times and you will gain top of mind awareness.

Something else that helps with top of mind awareness is being the first or the pioneer, which Tesla is after the death of the EV1's in the late 90's

As Tesla has a fairly small market right now and if we factor in the costs of wide spread advertising, I personal think they are doing the right thing.

The advertising they are currently generating is free PR and it carries more credibility. I am sure their investors appreciate this greatly.

Keep up the great work Tesla!

Vawlkus | 2013年5月19日

Tesla doesn't need to advertise until they can make more cars than they are selling. That is NOT the case since ATM they are production constrained.

Brian H | 2013年5月19日

True, that. Media advertisers blow their whole wad trying to get somewhere on the fringes of what Tesla has achieved directly: strong support by "opinion leaders" at the level of personal relationships.

The significance of those "crowds" is that they arose out of individual interest, without media prompting. Any other auto company would kill for such response and behavior and opportunity. TM says that 25% of those who take a store test drive go on to purchase. And the stores have full test drive schedules booked.

jk2014 | 2013年5月19日

Tesla had planned on model x production happening at the end of 2014 before 1.02 billion raise. Should they now push the timeline to spring 2014? Or should stick to planned MX date, and up MS production to 600/week to take advantage of surging demand?

Whatever the answer will be, I hope they have a robust training program for service technicians and manufacturing personnel because this whole thing is only going to gain more momentum with each passing day.

As far as the stores go, I think they should have a few real consoles on display for people to interact with. Have the 17 inch available to use. Of you open the pano roof, an animation of the MS on one of the big screens opens its pano roof. This woul allow people to learn how the car works without having be in the car. Give them a chance to learn all the cool features. Do voice commands with the radio, etc. have the one demo car, but have many interactive stations around the perimeter of the store. This inactive experience is what's great about the apple stores. I think this would improve on the current set up of just info screens. Maybe also have a demo of the charging process at home and at the superchargers.

It is amazing to see so many people just hanging out there every time I walk past it at the mall. Never seen anything like it outside of apple. Especially, never have this at a car dealership.

orthophonist | 2013年5月19日

No advertising needed. Here's one solution: Give a qualified purchaser a chance to test drive an S owned by a neighbor and if they buy one, Tesla sends the neighbor a $500 check.

SamO | 2013年5月19日


What a wonderful idea. That would encourage a LOT of Tesla owners that are already giving test drives for nothing.

Brian H | 2013年5月19日

What a dim idea. It would instantly destroy the credibility of every personal contact, generating the assumption "You're just doing it for the money."

It is the very opposite of spontaneous word-of-mouth. It will never happen.