Marketing Strategy for Tesla: Analysis and Recommendations

This report analyzes the marketing strategy of Tesla, including a situational analysis, evaluation of the threat of Brexit, competitive advantage analysis, and evaluation of the current marketing strategy. It also provides recommendations for market segmentation, targeting, and positioning.

MARKETING
STRATEGY

Table of Contents
EXECUTIVE SUMMARY ............................................................................................................1
INTRODUCTION...........................................................................................................................1
MAIN BODY ..................................................................................................................................2
PART 1............................................................................................................................................2
Situational Analysis ...................................................................................................................2
Evaluate threat of Brexit on organisation ...................................................................................4
Analyse competitive advantage (USP) .......................................................................................5
Evaluation of current marketing strategy....................................................................................6
PART 2 ...........................................................................................................................................6
Analyse market segmentation targeting and positioning ...........................................................6
Recommended objectives and goals for organisation ................................................................7
Recommend marketing strategies based on application of marketing mix ................................8
CONCLUSION .............................................................................................................................10
REFERENCES..............................................................................................................................10

EXECUTIVE SUMMARY
Marketing strategy refers to the long term plan that is used to look forward to achieving
the goal of earning higher profits. It also helps the organisation to gain the competitive
advantage in the marketplace by properly understand the needs and wants of the customers. This
report is based on the automotive company Tesla that is prominent and leading organisation in
manufacturing the electric cars in all over the world. This report involves the external and
internal factors which helps in analysing the opportunities and threats of the company and after
that manager of the company can develops the smart objectives for this they can includes the
STP model so that profits can be maximised and customers are attracted towards it.
INTRODUCTION
Marketing strategy refers to an essential term which reflects to the overall game plan for
reaching the people and turning them into a customers of the companies products and services. It
is also helpful in gaining the customers relations so that image of the organisation is enhanced.
This project is based on the Tesla that is one of the largest American Electric vehicle company
since 2003. The company mainly specialize in the manufacturing of electric vehicle, battery
energy storage form home to grid scale. The organisation can operates multiple of production
and assembly plants in their own factory. In Tesla there are 48,016 employees are working in all
over the stores in the world. This report is based on the two parts in which first includes the
situational analysis by using the PESTLE analysis and then using the SWOT analysis for
showing the impact of the Brexit on the company profits and revenues. It also involves the
analysis of competitive advantage for examine the current market strategy. Further in part second
it explains the STP model for achieving the goals and objectives to sustain in the market place by
retaining and attracting the customers for a longer period of time. Further it used the marketing
mix for presenting the best marketing strategies so that profits will be enhanced with increasing
the customer base(Patrutiu-Baltes, 2016).
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MAIN BODY
PART 1
Situational Analysis
It is basically a process of evaluating the internal and external conditions that will impact
the operations and products of the firm. It also helps in identify the new opportunities and
challenges for the business and their products and services. In context of Tesla, manager can
analyse the situation by using the PESTLE analysis because it helps in examine the extrinsic
factors so that challenges and opportunities can be easily identifies and it helps in evaluating the
effect on business internally(Perreault, 2018). For Tesla it can be shown below.
PESTLE ANALYSIS
 Political factor- This factor involves the government stability, fiscal policy, tax policies
etc. In this aspect policies imposed on trading the business impact the performance of the
organisation revenues. In this the government of a counr can mainly emphasised on the
electric vehicles so that to safe the environment for the major losses. In this Tesla, can
gain the major opportunities in stronger their financial performance through government
support and their incentives. Because it directly helps the environment by saving it from
the harmful pollution. This helps in gaining high profits and revenues and also attracts the
large base of customers. This term helps in gaining the high market share and brand
image into the marketplace. But at the same time Brexit was occur within the European
countries due to this supply of raw material from other European countries are quite
expensive because of this operational cost would be more and this will majorly affect the
overall revenues of the companies(Kingsnorth, 2019).
 Economical factor- It involves those aspects which shows the buying power of
customers, market growth, trade level and many other variables that mainly affect the
automotive industry. In terms of Tesla, decrease in battery cost and renewable energy
cost shows as opportunities for the companies whereas economic un- stability is a major
threats that was face by the organisation. In this low cost battery and the renewable
energy cost helps the business entity to attracts the large base of customers because it
looks more attractive in the eyes of the people of the society. But due to Brexit occur in
the country, Tesla can face the issue of low financial performance in European most of
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the countries. This will impact the people buying decisions and due to this overall sales
may be impacted negatively.
 Social factor- This aspect shows the trends, taste, preference and the behaviour of the
people towards the products and services of the company. In this business enterprises
mainly focus on the social trends that will helps in targeting the customers so that they
will maximise their benefits in terms of sustainability. In this Tesla can captures the
major opportunities related to enhancing the demands of the low carbon lifestyles in the
eyes of the customers. And also maximising the preference of the renewable energy. Both
these terms helps in maximising the demands of the vehicles of Tesla in the marketplace
and this helps in developing their market in the new countries also. Further because4 of
Brexit many people businesses are in loss and this will affect the spending power of
them so that Tesla can face the issue of selling their electric vehicle with more gain and
benefits(Olson and et. al., 2018).
 Technological factor- In present terms technological aspects is presenting as an essential
that because people are move towards the use of technology is every where and their day
to day life. In this Tesla, can gain more opportunities because of high using of
technological change, enhancing automation in the vehicles and their business operations
and by maximising the use of online mobile system company will gain more profits and
revenues for a longer period of time. It is considered as a threat for business firm because
of rapid obsolescence of the technologies that was adopted in the production of the
products. Due to this operating cost would be affected.
 Legal factor- It shows the laws and legal rights that was imposed by the government for
the benefits of employees, companies benefits so that organisation can gain high market
share. In case of Tesla, manager can protect their products by using patent right this helps
in gaining the competitive advantage and also adopts the equality pay right where they
can fairly treat their employees according to their abilities and capabilities(Kanagal,
2015).
 Environmental factor- It factors shows the laws relating to saving the environment form
the carbon emission this will attracts the large base of customers. In context of Tesla,
company can manufactures the electric vehicles that does not harm the environment this
helps in longer sustainability of the business ventures. In this organisation electric
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vehicles and solar panels are suitable for environment and their living being of the
society.
Evaluate threat of Brexit on organisation
In Tesla, manager can examine the threats of the company by using SWOT analysis
because it helps in boosting the overall business performance in the international market in the
automotive industry and it can be shown below.
SWOT ANALYSIS
STRENGTH WEAKNESSES
 The major strength of the Tesla is that
it operated their business with the
concerned of the adopting high
innovative processes and due to this it
will become the strong brand image in
the market place(Taoketao and et. al.,
2018).
 Another major strength of the company
is the launching of the insurance of
program for the vehicles related with
liberty mutual insurance company i.e.
InsureMyTesla.
 The major issue related with the
company is more manufacturing
complications due to this firm will face
delays in the new vehicle launching.
 There is lack of volume production in
the company because of Brexit occur in
the European countries that will reflects
the major weakness of the firm.
OPPORTUNITIES THRETS
 The major opportunity of the Tesla is
that they can expand their sales in the
untapped market especially in Asian
market. This helps in enhancing their
business financial resources that
provides the strong stability in the
international market.
 Another major opportunity is to bring
production technology in house that
 The main threat of the Tesla company
is the competitors that was present in
the global market from both technology
i.e. alternative fuel and self driving
technology(Baltes, 2015).
 One of the main threat is related with
Brexit occurs in European countries
because of this company purchase is
quite expensive of raw materials due to
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means they can make their own battery
cells this helps in reducing the
production cost and enhancing the
profit margin.
this high cost can be incurred so that
profits earning is also deducted.
 Because of Brexit Tesla can face the
low financial performance in the
European countries due to this its
sustainability may be affected in the
European market.
Analyse competitive advantage (USP)
Tesla Motors is the largest and unique company that not only sales the cars but also
selling the new technologies. They always betting the new technologies with other organisation
and gain the higher profits from that. This efficiency of the business firm helps in gaining the
competitive advantage in the business world. As, organisation can build a network of
superchargers, battery swap stations and service stations. The main USP i.e. unique selling price
of the Tesla Group is their adoption of new technologies in their manufacturing process and their
electric vehicles that does not harm the environment of the country this will helps in growing
their market in all over the world and it will also shows the high sales trends in market because
of their effective use of technologies in manufacturing of the car. This terms helps in beating the
competition and attracting a large base of customers by their unique features and
advancement(Lee and Johnson, 2019). In this their Tesla model 3 is the most selling model in all
over the world due to which company can beat their rivals on international market. Another USP
of business venture is artificial intelligence that is place under the vehicles and offered the
customers a high level of the Full Self Driving. This will helps in gaining the high profitability of
the company. This helps the drivers to maintains their vehicles. This technology is successfully
adopted by the Tesla due to this major challenge can be faced by the competitors in global
market(Dixon, Martinez and Martin, 2015). This will enhance the sales and profits of firm in the
automotive industry. As another competitive advantage of the organisation is their expansion in
the Asian market. Tesla covers the 23% of the market in selling the electric cars in the UK that
shows the biggest challenge to their competitors in enhancing and maintaining their sales for a
longer period of time. Due to this they can also attracts the Asian customers to buy and
encourages towards the use of electric vehicles. For gaining the competitive advantage company
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can targets those persons whose household income is above $80000. As they adopts the more
advanced cylindrical battery cells due to this this battery management system is high. All this
terms helps in enhancing their market share and also takes the advantage in gaining high profits
within the rival market.
Evaluation of current marketing strategy
Tesla is the well developed organisational objectives that see the prescient vision by
focusing on the highlights of enjoying the comparative benefits against other car companies.
Their design is like anatomist capabilities that combined the technical advancements of power
train process. Their current market strategy is dependent on accelerating the environment
friendly energy. In this Tesla can adopts the word of mouth promotional strategy because they
believe that the use experience can shape the public perception about the brand and their
products. Due to this word of mouth is helps in growing the company market in all over the
world(West, Ford and Ibrahim, 2015).
PART 2
Analyse market segmentation targeting and positioning
Tesla is the technology company that is the manufacturer of the cars by using advance
application of technology. That offers the affordable electric vehicles to average consumers. In
this manager of the Tesla, can follow the STP model to understand the people perception and
interest about the car and the brand. In gaining the high profits and longer sustainability it is very
essential to segments, target and position the market so that organisation can gain high market
share and growth. To understand effectively this model can be shown below(Choi, 2016).
STP MODEL
It is a wide framework that simplifies and summarizes the process of the market
segmentation. In which firm can segments the group of buyers according to their behaviour,
taste, perception etc. so that it easy to target them according to the set segments. It reflects as a
core concepts that serve the market in a successful way. In context of Tesla, theses three
activities are follow underneath(Berkhout, 2015).
 Segmenting - This term involves dividing the population into the smaller group of
people according to their age, social status, psychological features, region etc. in this
Tesla did not segment the market as fuel conscious people but they segments the people
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who make more contribution in building their high status quo in market by buying the
Tesla Electric cars. It helps in increasing the long term and innovative image of the
company in the car manufacturing industry. They basically called the price insensitive
people who spend more on their passion, interest and social status basis. Firm also
segments the market on the basis of behavioural in this according to the degree of loyalty.
Where hard core loyal people, soft core loyal people and switchers are included in this
hard corner loyal are the more gaining customers. This helps the company to sustain in
the market for a longer period of time and also take the effective decisions according to
their segmented group that gives high share and growth in international market. This also
helps in making successful company in a technology driven car manufacturing
organisation(Sugandini, and et. al., 2018).
 Targeting – This term denotes as an most attractive segments from the several
segmented groups. This helps in providing the most profitable for the organisation. In this
manager of Tesla can targets the market on the basis of set segments. In this manager can
targets mainly the 40 to 55 age group of people for their Tesla Model 3, Model X. For
their sports car they targets the male customers and who mainly focus on showing their
status symbol in the society. In this they generally targets the high elite people who are
responsible for the social welfare also so that they can quickly attracts towards the
environmentalist.
 Positioning – As Tesla is the most famous company who manufactures the electric
vehicles. This electric vehicles are not common due to this they place a distinct position
in the marketplace. For this manager can adopts the word of mouth and digital media
platform where they can create a high value position for their brand and products in the
international market. As they also uses the mano- segments positioning that means they
contains the large market share in manufacturing environmental friendly vehicles(Wu and
Lin, 2016).
Recommended objectives and goals for organisation
Setting the objectives is very essential to get the higher success and growth in the
marketplace. If these are set to be smart than it helps the business firm to attracts the large base
of people in a short period of time. For Tesla this report is recommended some goals and
objectives so that they can maximise their high market share and profits margin within a set
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period of time. This term also helps the firm to sustain for a longer time frame in the industry
with high brand position and value in the eyes of customers. The main objectives of Tesla in
which they work is providing the environmental friendly vehicles that does not harm the
environment and this also shows the CSR policies of the company regarding environmentalist.
For Tesla, SMART objectives can be shown below(Malachovskýª and Kiráľováᵇ, 2015).
 SPECIFIC – In this manger of Tesla can enhance their customer base, sales volume and
the profitability by creating the awareness in the market towards their electric vehicles so
that they can earn higher profits and revenues with a period of one year.
 MEASURABLE – In this Tesla can measure the objectives by reflecting that they can
maximise their customer base by 30% , profits by 20% and sales by 25% with in the
period of one year. It can be examined by comparing the previous year sales and profits.
 ACHIEVABLE- This target is achieving by training the employees on timely basis so
that they can solve the issues of customers and make the new customers for the
organisation. In this Tesla can focus on their available resources so that they can be
utilised best for attaining the overall success. The target related to enhancing the sales
volume and growth of the company can be achieved by the Tesla within a 1 year(Åberg,
Fälting, and Forssell, 2016).
 REALISTIC – For Tesla it is very essential to work on the objectives so that they get the
realistic outcomes on the set period. For this they can provide proper training to their
employees so that they can create more awareness in the market about the company
products so that sales and profits would be maximised.
 TIME FRAME – The above set objectives can be attained by the time period of the one
year after proper planning and execution. Within this time period manager of the
organisation assure that goals related to creating awareness, enhancing sales volume and
profits is to be reached.
Recommend marketing strategies based on application of marketing mix
Marketing mix refers to a strategic tool that reflects the set of actions or tactics which is
used by the company for promoting and advertising their brand and product into the marketplace.
It involves the 7 elements such as product, price, place, promotion, people, physical evidence
and process. In context of Tesla this aspects can be used for suggesting the market strategy so
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that they can maximise their profit margin and sales and also sustain for a longer time in the
international market with their good market position(Zamani, Abas and Amin, 2016).
 Product – Tesla is known for the sustainable products that specially sales the electric
cars. They have several mind blowing electric cars that helps in changing the way of
thinking of people towards the environmental friendly cars. Mainly Tesla has three
models i.e. Model S, Model X, Model 3 that have great engines and speed is 0 to 60 mph
in around 3 seconds. They also made smartphone charger, surfboards, tiny die casts,
hoodie caps and shirts since 2018. this brand is very helpful in surprising the people with
their unique product strategy. As they offer the tiny replica cars for the children which
they drive without even knowing driving.
 Price – This is an essential strategy where Tesla always provide a shock to their
customers with their pricing strategy. In enhancing their sales and profits in all over the
world they can offers their products with the premium pricing strategy because they
mainly focus on the advanced technology due to this there cars look attractive and
environmental friendly. Even on the high price they can attracts the large base of
customers. This prici9ng strategy also helps in enhancing their brand value due to this
their sales and market share also huge and it will survive in the market with more digital
innovations in their cars(Berman and Thelen, 2018).
 Place – This shows the outlets where the products and services are to be conveniently
delivered to the customers. In context of Tesla. Using this element of marketing mix it is
to be recommended that the firm can use the offline and online place to delivers their
products. Using online mode helps in removing the third party where customers can get
the proper knowledge regarding the vehicle where customer orders and company delivers
it to the consumers. As image of company is very high due to this they can offers their
test drive with the deposit of $ 5000. this will attracts the customers towards the usage of
cars and its design.
 Promotion – For promoting their electric vehicles this reprot recommended the digital
technology and artificial intelligence for creating awareness in the marketplace. In this
people can share their issues and problems and company can solve it by providing the
unique solutions. This helps in gain9ing the high profits and sales by Tesla.
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 People – Using this elements it is to be recommended that Tesla can provide proper
training to their employees so that they can attend their customers effectively that gives
the efficient results to the company(Nurcholis, 2018).
 Process – In manufacturing the cars Tesla can adopts the advanced technology and also
use the digitalisation in maintaining the customer relationship management so that large
number of people get attracted towards the company.
 Physical evidence – Tesla designer electric vehicles and their stores are the major
physical evidence that create a great impact on the people of the society and also
encourage them to wards their unique features. This helps in gaining the high profits and
revenues(Yang, amd et. al., 2017).
CONCLUSION
From the above explained report it is to be concluded that marketing strategy is an
significant term for gaining the high profits and growth within the market place for attracting the
people towards the organisation products so that they can become a loyal customers for a
business entity to a longer period of time. This inculcates the various terms like analysis of the
situation so that making effective strategy helps in sustainability of business firm. For this
PESTLE analysis is very effective because it gives almost all the extrinsic information that will
impact the business overall operations and for examine the internal strength firm will adopts the
use of SWOT analysis so that threats can be easily identified. By using above factors current
marketing strategy is easily identified. Further it involves the use of STP for selecting the
customers of the products and for creating awareness so that people are retaining with the firm's
products and services. At last using elements of marketing mix Tesla marketing strategies can be
recommended so that they ca n gain higher revenues in their future terms.
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