Post on 30-Aug-2020
Tesla Repositioning Report
By: Nic Roti, Jake Wietting, Katie Picciola, & Joe Pacini
Buyer Behavior, Aaron Hurley
30 April 2018
Table of Contents
Executive Summary Page 3
Background Page 3
Phase 2 Page 4 - 9
Re-positioning Statement Page 9
Marketing Mix Recommendations Page 10
Appendixes Page 12
Executive Summary:
This report provides an in-depth overview of Tesla and how we are repositioning the brand to
the masses instead of their original demographic. First, we completed primary research on the
company. We also completed secondary research which was a questionnaire on Qualtrics. We
surveyed multiple demographics to determine what was best to market Tesla to the masses. We
received just under 100 surveys. The reports have helped us understand what the general
masses would like to see in Tesla and how we would reposition the brand.
Background:
Tesla is a company that is expanding the sustainable energy into the world through cars,
as well as other energy integrated solutions. Their main goal is to power you home and car
through clean energy day and night. Tesla is known for their sustainable vehicles that offer the
safest and quickest cars on the road. Tesla has four consumer electric vehicles: the Model S,
Model X, Model 3, and the Roadster. A huge feature to their Model X SUV is the Autopilot. This
is where the SUV can do a lane change, auto steer, and even park your vehicle. The benefit of
autopilot is that you don’t need to have your hands on the wheel, and that your car is driving
itself. Tesla was really the start of cutting edge technology for vehicles. Now other brands, like
Cadillac, are also starting to put autopilot into some of their vehicles. Another large feature of
the vehicles is the range of how far they can go with just one charge. This is a huge benefit
because some consumers think that you would have to stop a lot to recharge your electric
vehicle but that’s not the case for Tesla. Another feature is the safety of the vehicles. They all
have five stars from every angle and aspect of the vehicle. The vehicles are also quick, they
accelerate from zero to 60 mph in their model X SUV. This is a huge benefit because it shows
that it is the quickest SUV at responsiveness. Some consumers find that the interior of a vehicle
can be the most important part. Tesla does not disappoint in this aspect either. They have 17-
inch display screen where they have different media, and controls available to the driver. The
benefit to this is that a driver isn’t squinting to look at the radio and becoming a distracted driver.
They also have great storage and many other interior features. Every part of the Tesla vehicles
has features which is what makes them such a great investment.
Phase two:
Consumers currently use the Tesla products like most of the other vehicles they have
previously owned. The only difference is that it is electric. As I stated before, I believe that most
consumers view the Tesla vehicles as luxuries because of their high prices. The Model S
Standard is cheaper than the Chevy Bolt. However, their other models are more expensive than
any other electric vehicles. I do believe that they have the highest quality. Some of the customer
segments are fairly similar. Male, ages 45-60+, with an income of over 90,000. This segment
specifically enjoys the Tesla brand as well as the electric vehicles. The other segment is male or
female, ages 26-40, with an average income of over 50,000. This segment mostly just enjoys
Tesla electric vehicles and the sustainability that they provide along with the luxurious vibe.
The market for electric vehicles is growing steadily but still holds a very small percentage
of total car sales. The market share for electric vehicles globally sits around 3% of the total car
sales. Although this might seem like a very small percentage because it is, the market has seen
an increase every year with 2018 being no different. In 2017 every monthly record for electric
vehicle sales were broke, making it a record year in the U.S. The forecast for the next 25 years
looks extremely positive and seems to be increasing every year. A forecast produced by OPEC
which is a group of the leading oil producing nations has increase their electric vehicle forecast
by over 500% in the next 50 years. This is a young market and is just starting to get global
popularity but the forecasts look promising towards the electric vehicle industry.
Major competitors within Tesla’s market include car manufacturers who are releasing
lines of both hybrid and electric cars such as Nissan, Volkswagen, and General Motors. General
Motors released the hybrid Chevrolet Volt long before Tesla released the Model 3. The Model 3
has been criticized as a bait-and-switch from the Bolt but included features such as autopilot
and a longer-lasting battery.
Globally, China is the biggest competition, as they have the biggest market for electric
car manufacturers. It is home to six of the ten major electric car manufacturers worldwide.
The photo above is a Brand Map on a horizontal scale of conservative to modern, and a vertical
scale of technically regular to innovative. As one can see, among its competitors, Tesla is
extremely Innovative and extremely modern. This is how they’re marketing their brand against
its competitors. There aren’t too many spots that can be filled as competitors cover the spots
that are most accessible.
Trends have been seen in the electric car industry. One of these trends include the
recent peak of sales. Sales records have been set for North American and around the world and
the bar continues to grow. Along with Sales, as you can see in the image above, charging
stations have been exponentially expanding. The above photo shows Tesla’s charging stations
in North America. The red points depict charging stations that are open now and the gray point
show charging stations that are opening soon. Between Asia, North America, Europe, and the
Middle East, Tesla has 1,191 Supercharger Stations with 9,184 Superchargers. This number is
only going to increase in the future.
Among our consumers’ consideration set includes GM’s Chevy Bolt, Toyota’s Prius
Prime, The Nissan LEAF, the Chevy Spark, the Fiat 500E, the Toyota RAV4, and the BMW i3.
Tesla takes the lead in EV sales as a company, but the car market is slowly but surely switching
to eventually become EV only car companies.
Important brands and product attributes towards Tesla’s brand images is important.
Tesla is wanting to prove to their customers they’re getting the best value for their dollar while
also getting the best products. This belief exists because of how if they’re unable to provide top
of the line products, their company mission is not being completed and they could also lose their
dominance in the market. The salient attributes will be impacted since the brand image of being
the best car is strong, changing judgment could significantly impact their company and change
its course for the worst. Consumers when purchasing Tesla’s brand feel “empowered and
motivated” considering they’re going above and beyond to complete their tasks of creating
innovative technology to out beat competitors. Tesla gives its consumers the loyalty of
constantly expanding and growing while making sure their consumers are well taken care of.
They also do not let themselves get out beaten. If Tesla were to see their competition coming
out with similar products, they will take immediate action to out beat their competitors.
Tesla’s internal and external research comes from a strong understanding of industry
trends from their consumers and the media. As stated before, Tesla is constantly innovating its
own products while also helping advance the market of themselves. They take information they
receive from their users to better understand themselves and act upon it, improving themselves
and making their brand loyalty for enhanced.
Consumers will likely learn about our product from our stock price and our brand image.
Exposure is more likely to be intentional because of Elon Musk becoming a household name.
With more and more Tesla’s being purchased and the amount of exposure in the stock, it is very
likely someone knows another that has our product. Exposure can also be accidental from viral
videos being uploaded online about our product or from the news. Comprehension of our brand
and vehicles will at first be shallow because of our innovation but this will spark a deep interest.
People love to be at the forefront of technology and this will spark an interest in our vehicles and
company. There can be many inferences made about our product but I hope first they infer our
vehicles are intriguing and stylish with a healthy output on the environment. Their involvement
and knowledge in our product will be our environmentally friendly vehicles. Our consumers will
value luxury and our product breathes luxury. Our modern interior and all electric vehicle will
help them realize that.
The general lifestyle of our consumers is modern, upper middle-class consumers looking
to lowering their carbon footprint. Symbolic meaning is important to our product since it is the
leading electric car manufacturer. Tesla stands by its products and is making it not only
luxurious but affordable to own an electric vehicle. The futuristic nature of this company is what
distinguishes it from competitors. Using a Tesla vehicle will tell others that not only does the
environment mean a lot to you but also luxury and comfort. It will let others know you are at the
forefront of innovation and comes with the status of possibly being wealthy.
Some issues with one's personality that might affect purchasing is how our vehicles are
all electric. Although one would think this would make our vehicles more attractive some people
are “old fashioned” and set with their ways of buying gas cars. The image of possibly being not
reliable since we are electric is a thought in many consumers minds. We strive in reversing this
thought with bringing more electric charging stations and the lifetime of our products is far
superior to your gas vehicle.
Consumer psychographics affect our vehicles usage. From our marketing research
survey, it showed 11 of the 19 people who owned a Tesla make over $100,000 a year. 13 of the
19 Tesla owners were between the ages of 45-55 compared to only one Tesla owner between
the ages of 18-25. So, these consumers are typically middle aged and have an income of over
$100,000, they are also predominantly male with 15-4 male to female ownership. Most of the
surveyors who own a Tesla responded they bought it because it was electric and to save money
from their being no gas expense. 17 of the 19 surveyors who own a Tesla have either their
bachelor degree or a master’s degree from college. It was almost split with the owners living in
the city or rural areas.
Well the decision that had to be made is if they wanted to buy an electric vehicle. Our
research survey showed that 8 of the 19 buyers chose this vehicle because there would be no
added expenses for gas. The Tesla models that were purchased are the Model S(14), and the
Model X(5). 6 of the 19 buyers chose to purchase a Tesla because of the technology the vehicle
offers. This was a decision that was made, if they wanted to have one of the most tech savvy
vehicles on the market or not.
Some typical decision strategies in this type of product category are similar. How much
would the consumer be saving on gas? How does that compare with how much a consumer is
spending on the vehicle? How often does a consumer need to charge their vehicle for? Most
things that influence buyers are current customers and how they enjoy or do not enjoy their
Tesla. Something else that influences buyers is the famous Elon Musk and his public
statements. For example, on April fool’s day Elon made a public statement that Tesla was going
bankrupt, of course it was a joke. The following day the Tesla stock fell 7%. That instance
shows the kind of power Elon has and how even small mistakes can really impact Tesla and
consumers position on their company. Word of mouth can be an important factor for purchasing
a Tesla vehicle. There is a lot of negativity in the media about the brand, but if a possible
consumer were to talk to someone who owns a Tesla and has enjoyed the experience, then it
would change the negativity they have in their minds. Word of mouth flows through connections,
whether that is social media friends or even real-life friends and family.
Consumers can buy the Tesla once being on the waiting list, or at a Tesla dealership. I
think the waiting list is something that can improve because not everyone has the time to wait
for a new vehicle. The sales environment is so important, no one wants to buy a vehicle when
they have a negative experience. It sets the tone for the brand as well as the vehicle. In a
business world almost everything matters and influences the consumers decision.
Re-positioning statement:
We are moving Tesla, a brand containing modern and innovative electric vehicles that is
thought of as luxurious, expensive, and too futuristic, away from solely high income receiving
consumers. We are moving Tesla, a car company who capitalize on energy saving, safety
testing, and advances in technology to produce an electric vehicle with the some of the highest
quality in the market, to the masses.
Marketing Mix Recommendations
Our product strategy is to keep Tesla’s original vehicle’s while allowing a better price.
We also discussed introducing a hybrid vehicle. All packaging and brand features for the electric
vehicles will be staying the same. However, we will be introducing a more advanced product
testing prior to releasing the vehicles to consumers. From the recent car problems, we decided
that the company should focus on their vehicle maintenance. The pricing strategy for our brand
revolves around the feedback we received from our questionnaire. We found that possible
consumers would be more interested in purchasing a Tesla if the price was lowered. We also
found that most consumers weren’t aware of the actual cost of the vehicles. We decided to
lower the more expensive models like the Tesla X around $60,000 instead of $80,000. We did
this because it was closer to the competitor’s price while still being a part of the luxury cars.
Consumers need transparency and we feel it would be more valuable to the company if Tesla
was more transparent about their pricing.
Tesla really does not do too much promotional currently. They are more word of mouth
and popular throughout some social media platforms. We really wanted our promotional to be
successful throughout all demographics. One promotional idea that we had is to have
commercials with the use of different celebrities that are popular throughout different age
groups. It would be similar to the Lincoln commercials with Matthew McConaughey. We would
have different celebrities like Migos, George Clooney, GiGi Hadid, etc. This will create
consumer awareness because each celebrity is reaching a different demographic throughout a
series of commercials. We would also recommend increasing their social media platforms
presence.
Tesla’s overall promotion mix is reached by all their consumers or potential consumers
across any social media platform, personal selling, over even word of mouth. Tesla is proud of
their customer and brand loyalty in which has stayed consistent over the last two decades. This
is all triggered by our advertising objectives, which is to not only reach out to an older
generation, but millennials who are able to afford the product and appreciate it. The way our
tactics generate this recognition is the general substance of our message.
Our main message to our consumers is that we are a reliability, luxury, environmental
friendliness while still being affordable like other energy efficient vehicles. After all this, we have
happy consumers who then see others with a Tesla and help inspire those to get one. We have
various commercials, ads, and online campaigns. We stream our commercials through various
social media such as Facebook or YouTube, two of the biggest media platforms on the internet.
The advancements in social media movements continue to grow our brand stronger and more
efficient.
Appendixes
1. How old are you?
2. Male or female?
3. How much is your individual income?
4. Are you married or single?
o If you are married do you have children? How many?
▪ 3 people - 1 child
▪ 14 people - 2 children
▪ 7 people - 3 children
▪ 3 people - 4 children
▪ 1 person - 5 children
5. Highest level of school/degree achieved?
6. Do you live in a rural or city area?
7. Do you currently own a Tesla?
If yes, what kind?
Why did you buy it?
How is the customer service?
8. Are you satisfied with the Tesla experience?
9. Why don’t you own one?
Just about every response that we’ve gotten included the fact that Tesla’s are too
expensive and that people don’t have enough money to purchase one.
10. How do you feel about Tesla as a brand?
11. How do you feel about electric vehicles?
12. Which Tesla Model do you like best and why?
o The majority of the responses we’ve received indicate that our survey takers
aren’t too knowledgeable about the different models that Tesla has to offer.
13. How do you feel about the price range of the Tesla vehicles?
14. What would make you more likely to purchase a Tesla?
o The main responses that we received talk about lowering the price of the car,
whether their answer is having a higher salary, more affordable costs, or winning
the lottery.
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