Tag Archives: advertising

by | Thursday, April 25, 2024 · 9:46 am

Tesla is Now Spending on Advertising

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:

  1. Poll students: How has Tesla historically marketed its vehicles?
  2. Why is Tesla now advertising?
  3. View Tesla YouTube ads: https://youtu.be/L2fticPH-to?si=6Q4zwI6gXHaHryLh  
  4. View Tesla ads on X: https://twitter.com/Tesla/status/1770846108098375680?s=20
  5. Poll students: Who has seen an ad for Tesla on any of their social media feeds?
  6. Discuss the Product Life Cycle (PLC) and how advertising is used at each stage.
  7. Have students draw a PLC and place the EV industry. Then have them place other automobile companies.
  8. 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.

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by | Tuesday, April 23, 2024 · 7:42 am

Tiger Woods Launches a New Brand – Sun Day Red

Even if you know very little about golf, you can probably recognize professional golfer Tiger Woods wearing his signature red Nike swoosh shirt …. Oops… I forgot, no more Nike shirts for Tiger, he ended that relationship a few months ago after 27 years of sponsorship.

Now, Woods is launching his new brand with TaylorMade Golf. But he still favors the red polo shirt for Sunday rounds. He’s even named his new brand “Sun Day Red” albeit with a tiger embroidered on the shirt instead of a swoosh. The tiger logo is composed of 15 stripes which is the number of championships won by Tiger Woods.

Sun Day Red will be marketed as a premium lifestyle brand for athletes, fans, and non-athletes alike, including apparel, hoodies, shoes, and cashmere sweaters. In essence, the company will be combining golf with fashion and leisure for lifestyle wear. Woods isn’t the only athlete to launch such a lifestyle brand; Roger Federer, Tom Brady, Michael Phelps, and Venus and Serena Williams have also entered the marketplace with their own lifestyle/sports brands.

Products will be available online beginning in May, to be followed by international expansion. While pricey, the items are not extreme – polo shirts from $114 – $175, and cashmere sweaters $250 – $350. While TaylorMade does not yet have golf footwear, it’s reportedly under development.

Shall we get a tee time next Sunday?

Group Activities and Discussion Questions:

  1. Discuss how professional athletes have started their own brands.
  2. Show website: https://www.sundayred.com/
  3. Discuss how to build and use a SWOT analysis grid: strengths, weaknesses, opportunities, and threats (internal and external factors).
  4. Divide students into teams. Have each team select a professional athlete who also has a brand associated with them. (Include Tiger Woods as one of the athletic brands.)
  5. For each athlete, including Tiger Woods, direct the team to build a SWOT analysis grid.
    1. Strengths: what is the brand good at?
    1. Weaknesses: what needs work?
    1. Opportunities: what is going on in the marketplace?
    1. Threats: what should the brand be wary of?
  6. Based on the analysis, what are the issues and risks that might occur for each brand?
  7. Debrief by building SWOT analysis grid on the white board.

Source: Ferguson, D. (13 February 2024). Tiger Woods unveils Sun Day Red, a new apparel brand with TaylorMade. Associated Press; Hirsch, L. & Friedman, V. (12 February 2024). Tiger Woods introduces his new brand: Sun Day Red. New York Times.

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by | Thursday, April 11, 2024 · 7:22 am

Walmart Buys VIZIO to Grow Advertising

No longer content to be just a retail powerhouse, Walmart wants to expand into the advertising business and compete with online rival Amazon. To that end, Walmart is buying smart TV manufacturer VIZIO for $2.3 billion.

Why buy VIZIO? Mainly because VIZIO’s SmartCast Operating System will allow Walmart to connect with consumers using innovative entertainment. (Or should we say it will allow Walmart to advertise more easily.) VIZIO has more than 18 million accounts on SmartCast, which offers free, streamed content that is supported by ads. VIZIO’s advertising business has more than 500 direct advertiser relationships, including a number of Fortune 500 firms.

Today, Walmart does sell ads at its 10,500 physical stores and websites. But once it acquires VIZIO, Walmart will be able to sell ads through streaming services on televisions, similar to how Roku and Amazon operate.

Walmart stores serve 160 million visitors each week; a whopping 90% of all Americans shop at Walmart. And while Walmart’s advertising business generated revenue of $3.4 billion, that amount is less than one percent of its total retail sales. Compare this to Amazon which generates ad sales of about 15% of its total sales and the reason for the acquisition becomes clearer.

By buying VIZIO, Walmart keeps its valuable shopping data and gains operating systems and hardware that are used to deliver ads. It expands Walmart Connect, which brings advertising partners into contact with its extensive customer base through sponsored products ads.

Group Activities and Discussion Questions:

  1. Discuss the various approaches for promoting products.
  2. Show Vizio website: https://www.vizio.com/en/home
  3. Show Walmart Connect website: https://www.walmartconnect.com/
  4. Divide students into teams. Have each team analyze how Amazon and Walmart use sponsored ads to drive sales.
  5. In teams, have students develop a promotional plan that uses VIZIO to advertise.

Source: Meyersohn, N. (20 February 2024). Why Walmart is buying Vizio. CNN Business; Peiser, J. & Gregg, A. (20 February 2024). Walmart to buy TV maker Vizio for $2.3 billion to expand advertising. The Washington Post; other news sources

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