Examination of Tesla's Marketing Strategies

This document examines the marketing strategies of Tesla Inc., focusing on distribution, segmentation, and positioning. It also discusses the key principles of sustainable marketing and management practices within the company. The document evaluates the success of Tesla's sustainable marketing strategy.

LA TROBE BUSINESS SCHOOL
BUS5SMM SUSTAINABLE MANAGEMENT & MARKETING
Lecturer: Dr. Rosa E Rios
Cohort (Tuesday 10 AM or Wednesday 8AM Bundoora Campus)
Assessment 2
Student name:
.Student number:
COMPANY: Tesla
Submission date:
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1.0 Examination of the marketing strategies of the company:
Marketing strategy is referred to as a long term and forward looking approach for
planning with one of the most fundamental and important goal to achieve proper sustainable
competitive strategies (Benn, Edwards and Williams 2014).
Tesla Inc. is one of the most important and significant American energy and automotive
company based in Palo Alto, California (Tesla Impact Report. 2019). This particular
organization has specialization in manufacturing of electric cars and by the SolarCity
subsidiary and manufacturing of solar panel. Tesla Inc. is operating at multiple production or
assembly plant, majorly at Reno Nevada and the main vehicle manufacturing facility at the
factory of Tesla in California (Tesla Impact Report. 2019).
The marketing strategy of Tesla Inc. is extremely unique and significant. It includes
segmentation, targeting and positioning. The marketing strategy of Tesla Inc. includes:
i) Distribution Strategy in the Marketing Strategy: Tesla majorly utilizes online sales
model that is coupled with few organizational owned stores for the core purpose of selling
the cars and not even utilizing conventional dealer networks (Solow 2014). This type of
distribution is being fraught by various challenges and Tesla is focusing on distribution
channel. The other competitors of this company like General Motors and Ford easily team up
with third parties for selling the vehicles, however for Tesla, the brick and mortar store
substantially serves as one of the major channels for selling their products (Mowforth and
Munt 2015). With this particular marketing strategy, they are being able to interact with all
potential customers and is currently running more than 17 stores in the entire world.
ii) Proper Segmentation in the Marketing Strategy of Tesla: This particular automobile
organization has also focused on market segmentation strategy so that they are able to deal
with all types of complexities and issues faced due to understanding the respective market.
According to Clayton and Radcliffe 2018, the model S eventually sells for circa Australian
dollars of 120000 and hence they have examined several methods for segmenting the market
and positioning firmly within the car market. Previously, the market strategy did not include
market segmentation and price positioning and these were both undefined and vague.
Recently, they have repositioned their brand as new technology for clean energy (Gibson,
Hassan and Tansey 2013). The target market segmentation of Tesla is quite different from all
other companies, after inclusion of few aspects like geographic, demographic, behavioral and
psychographic.
iii) Positioning in the Marketing Strategy of Tesla: The third important strategy that
Tesla has made for its business is positioning. This specific organization is being strategically
positioned within the electric vehicle market as one of the most end manufacturer or dealer
(Bell and Morse 2013). They are even gaining competitive advantages for direct to consumer
sales and technological innovations.
2.0 Identification of key principles of sustainable marketing and management practices within
the company.
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The most important and significant key principles of sustainable marketing are as
follows:
i) Consumer Oriented Marketing: According to this principle of sustainable marketing,
an organization must take an overview and then organize the respective marketing
activities from the point of view of a customer (Laszlo and Zhexembayeva 2017). Hence,
Tesla ensures customer satisfaction needs by simply meeting all types of expectations for
performances. Quality of the cars is also maintained so that a profitable long term
relationship with their customers is possible (Neubauer and Lank 2016).
ii) Customer Value Marketing: The second sustainable marketing principle is customer
value marketing. According to this principle of sustainable marketing, Tesla has put
themselves into a position in which all the resources are building marketing investment
(Crane and Matten 2016). Due to customer segmentation, the organization of Tesla hence
had been able to acquire the top most position within automobile
iii) Innovative Marketing: The next sustainable marketing principle is innovative
marketing. According to this particular principle, it is highly required to seek original
products as well as marketing improvements (Liu et al. 2015). Market competition
increases major innovation and technological progresses in each and every area for
effectively meeting up of customer requirements. This particular principle has been quite
effective for Tesla to maintain sustainability marketing in their business (Bebbington,
Unerman and O’DWYER 2014).
Apart from sustainable marketing principle is, there are few practices of sustainability of
Tesla as well and these are as follows:
i) Environmental Planning: This is one of the most important sustainability practice in
Tesla (Benn, Edwards and Williams 2014). Although, they are dealing with car
manufacturing, they ensure that proper environmental planning is being enhanced under
every circumstance.
ii) Resource Management: Tesla even makes sure that the respective resources of this
organization is maintaining environmental sustainability like waste management, energy
conservation and effective utilization of water (Bell and Morse 2013). This had been
quite effective for the business and society that they are not using resources exhaustively,
thus ensuring better management of sustainability.
iii) Water conservation: This is the third and another important and significant
sustainability practice in Tesla (Gibson, Hassan and Tansey 2013). This practice can
encompass an effective utilization of technologies, maintenance of equipment and
fulfilling conservation measures for maximization of water usage.
3.0 Response, by the company, to the identification of sustainable principles.
Tesla Inc., although being an automobile organization, is also focusing on sustainable
marketing principles as well as management practices in the business (Laszlo and
Zhexembayeva 2017). Sustainable marketing is stated as green marketing, which is
environmentally or socially responsible for effectively meeting the current requirements of
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businesses and customers, and even enhancing the core capability of future generations for
meeting the needs (Neubauer and Lank 2016). After analysis of the sustainability report of
Tesla Inc., it is being eventually observed that they are maintaining organizational
sustainability by making proper planning and by following three sustainable principles and
three sustainable management practices (Tesla Impact Report. 2019). With the core help of
customer oriented marketing and customer value marketing, they had been able to deal and
fulfill the needs of their customers in an effective manner.
The specific marketing process of customer oriented marketing majorly points out the
core significance towards business of orient one for the customer requirements and also for
creation of correct values (Crane and Matten 2016). On the other hand, the customer value is
the current value of profit that is being obtained from the customers by maintenance of
proper products and services. Similarly, sustainable management practices such as
environmental planning, resource management and water conversation have been much
effective for them to launch Model S in their business (Bebbington, Unerman and
O’DWYER 2014). They want to develop products, which are not only sustainable in nature,
but also extremely superior to the alternatives of fossil fuels so that selection of sustainable
products can easily maintain an ecological balance and profit in their business, since
customer are most interested in such cars. The electricity production and transportation are
termed as the largest sources for GHG emissions and hence with the help of sustainable
products of Tesla, this issue could be reduced to a high level (Tesla Impact Report. 2019).
Hence, they have focused on their unique as well as effective sustainable principles and
sustainable management practices.
4.0 Evaluation of the success, or otherwise, of the company’s sustainable marketing strategy.
The strategic planning includes a proper analysis of organizational strategic initial
situation that is prior to the proper formulation, evaluation as well as selection of significant
market oriented competitive positions, which eventually contribute to fulfilment of
organizational objectives and few marketing goals (Liu et al. 2015). This type of strategy is
extremely important and significant for laying out of target markets for ensuring that value
proposition would be offered on the basis of the analysis of few major market opportunities.
Tesla Inc. has implemented some of the most important and significant sustainable marketing
strategies in their organization for ensuring that the mission and vision of this organization
are being achieved successfully.
The vision and mission statements of Tesla reflect on the organizational objective for
dominance within globalized battery market and electric vehicles (Solow 2014). The mission
statement of Tesla is to accelerate the transition of the world towards sustainable energy.
They eventually believe that a faster world has stopped being dependent on any type of fossil
fuel, hence moving towards zero emission future to make the world even better. They are
making cars in such a manner that they are sustainable in nature (Tesla Impact Report. 2019).
The vision statement of Tesla Inc. is to create the most persuasive car organization in the
current 21st century by properly driving transition of the world to electrical vehicle. Due to
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this type of effectiveness, Tesla has become successful in extremely smaller span of time.
Moreover, they even want to provide their customers with products that can help them in
dealing with climate change issues (Tesla Impact Report. 2019). Renewable energy
generation as well as storage are eventually termed as the most important components to
develop their organizational micro grids. These are much more vital for delivering both
sustainable and reliable electricity in the entire world (Clayton and Radcliffe 2018). When
implementation of such products would be increased in Tesla, they could easily and promptly
scale the entire adoption of renewable energy and then cost effectively modernize aging
infrastructure for improvement of the resilience of electric grids.
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Reference list
Bebbington, J., Unerman, J. and O’DWYER, B.R.E.N.D.A.N., 2014. Introduction to
sustainability accounting and accountability. In Sustainability accounting and accountability(pp.
21-32). Routledge.
Bell, S. and Morse, S., 2013. Measuring sustainability: Learning from doing. Routledge.
Benn, S., Edwards, M. and Williams, T., 2014. Organizational change for corporate
sustainability. Routledge.
Clayton, T. and Radcliffe, N., 2018. Sustainability: a systems approach. Routledge.
Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. Oxford University Press.
Gibson, B., Hassan, S. and Tansey, J., 2013. Sustainability assessment: criteria and processes.
Routledge.
Laszlo, C. and Zhexembayeva, N., 2017. Embedded sustainability. In Embedded
Sustainability (pp. 116-140). Routledge.
Liu, J., Mooney, H., Hull, V., Davis, S.J., Gaskell, J., Hertel, T., Lubchenco, J., Seto, K.C.,
Gleick, P., Kremen, C. and Li, S., 2015. Systems integration for global
sustainability. Science, 347(6225), p.1258832.
Mowforth, M. and Munt, I., 2015. Tourism and sustainability: Development, globalisation and
new tourism in the third world. Routledge.
Neubauer, F. and Lank, A.G., 2016. The family business: Its governance for sustainability.
Springer.
Solow, R., 2014. An almost practical step toward sustainability. In An Almost Practical Step
Toward Sustainability (pp. 11-28). RFF Press.
Tesla Impact Report. 2019. [online]. Accessed from https://www.tesla.com/ns_videos/tesla-
impact-report-2019.pdf [Accessed on 10 May 2019].
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