Times are changing. Habits evolve. Products adapt. And, what worked in the past might not work today.
Here’s an example: Tesla has long avoiding the costs of advertising in any traditional way. Its own CEO, Elon Musk, has stated that he hates advertising. To date, Tesla has depended on its own social media accounts, consumers’ social media, stores, press coverage, and strong word-of-mouth branding. Plus, Elon Musk has access to a very large social media platform/followers and uses it to the company’s advantage.
But, Musk has changed his mind and spent about $6.4 million on digital advertising in the U.S. in 2023. While this is definitely an uptick from spending of only $175,000 in 2022, it pales in comparison to other automotive companies’ spending. For example, General Motors spent $3.6 BILLION on advertising and promotion in 2023.
So, where is Tesla advertising? Well, it is spending primarily on digital advertising on X (another Elon Musk company), Facebook, Instagram, and YouTube. Tesla has also bought Google search ads. Current Tesla advertising focuses on family and safety – this repositions the company from a sports car to family car.
And, why is Tesla advertising now? Perhaps it’s because its stock price is down, growth has declined, and competition has increased. Some of its ads even included promotional pricing to lower the cost of buying.
What do you think?
Group Activities and Discussion Questions:
- Poll students: How has Tesla historically marketed its vehicles?
- Why is Tesla now advertising?
- View Tesla YouTube ads: https://youtu.be/L2fticPH-to?si=6Q4zwI6gXHaHryLh
- View Tesla ads on X: https://twitter.com/Tesla/status/1770846108098375680?s=20
- Poll students: Who has seen an ad for Tesla on any of their social media feeds?
- Discuss the Product Life Cycle (PLC) and how advertising is used at each stage.
- Have students draw a PLC and place the EV industry. Then have them place other automobile companies.
- Given this, have the teams develop a marketing program for Tesla.
Source: Haggin, P. & Coffee. P. (29 March 2024). Tesla dives into advertising after years of resistance. Wall Street Journal; Kafka, P. (5 March 2024). Elon Musk has a unique plan to solve Twitter’s ad problems. Business Insider; Quiroz-Gutierrez, M. (29 March 2024). Tesla scraps Elon Musk’s no-advertising mantra as stock nosedived nearly 30% this year. Fortune.
