• Three Minutes

Tesla’s Advertising Budget: Zero

Updated: Jun 18, 2020

Tesla is a world-renowned brand and is infamous for never having released a single advertisement. People often say that Tesla has a $0 marketing budget but that’s only partly true. Tesla must be having a marketing budget, albeit a small one because everything from public relations, branded entertainment, event marketing to product placement comes under the umbrella of marketing. What still holds true is that Tesla has maintained a $0 advertising budget (Report by BrandTotal).

The reason why Tesla has been able to achieve this feat is that all of its campaigns claim an organic reach. The first factor here is that of leadership. The Musk-Paypal breakup was in the highlights, so when Elon Musk started his own company, it became the talk of the town. This was how the story began. Elon Musk and Tesla quickly gained a social media standing, with an army of followers on platforms like Twitter and Instagram. The choice of platforms here is also crucial because the average age of Facebook users is significantly higher than that of Instagram and Tesla being an EV manufacturer caters to a younger audience. Now leveraging these platforms Elon performed a trick, a trick so simple that no one thought that it can actually work.

Tesla didn’t create advertisements. It created news headlines, which were then floated by the media throughout the world for free. And owing to Musk’s eccentric nature, people took action. This is what happened recently Musk’s own tweet saying Tesla’s stock was “too high” reduced its value by $14 billion in hours. Every news channel reported this, giving them free publicity.

Elon Musk’s bizarre tweets are just one aspect. Some other important points to note is that Tesla has no dealerships. This means no pesky salesmen running after you. You can even customize your car online and often to buy a Tesla car you have to wait for weeks. All this adds up to the feel of a premium car, as people wait for their custom-made car they have a greater attachment to it. This leads to a crucial form of advertising – Word of mouth. These happy customers, go on and talk about their car at length influencing friends and family. Additionally, Tesla’s focus on customer relationship management ensures that they always have a smile on their face.

Musk’s personal brand has helped Tesla a lot, that can’t be denied. Other companies BMW, General Motors who spend up to 70% of their marketing budget on advertising won’t ever be able to mimic Tesla’s strategy but the sure can pick up some pointers.

P.S: Some newspapers and tabloids even said that the Cybertruck was made so ugly with the demonstration being a failure only because it was a marketing gimmick. But people who are brand loyal to Tesla still bought that and it is indeed something to sell a truck that comes in the top five search results when you google “Ugly truck”.

Thank you for your Three Minutes. If you like our content do subscribe to us and we'll ensure that the latest, handpicked content is delivered to you every day.

128 views0 comments

Recent Posts

See All