In-Depth Report on Tesla's Operations and Marketing Strategies

This report provides a detailed analysis of Tesla's operational and marketing strategies, examining the company's background, market environment, SWOT, PESTLE, and Porter's Five Forces. It explores Tesla's marketing mix, segmentation, and value creation through value chain analysis. The report highlights Tesla's strengths in innovation and environmental consciousness, while also addressing weaknesses like production delays and high costs. Opportunities for expansion and threats from competition are discussed, along with recommendations for future growth and sustainability. The analysis emphasizes Tesla's commitment to sustainability and its unique positioning in the electric vehicle market.

Managing Operations and Marketing

Executive Summary
Operation management is related to performing the activities in an efficient manner by
using effective tools & techniques. Marketing is an art of preparing attractive advertisement and
promotion campaigns in order to grab the attention of buyers. Main aim of marketing is to
enhance the sales and profitability of the organization by gaining the attention of the customers.
The report aims to analyze the operational and marketing strategies of TESLA. It is found that
the company is working in a dynamic environment and has several strengths and weakness based
on the internal resoures. It is analyzed that the automotive industry has the opportunities of
growth. Also, the company is able to maintain positive positing by offering environmental
friendly and sustainable products to the customers.

Table of Contents
Introduction......................................................................................................................................4
Background of TESLA....................................................................................................................4
Market & Environment analysis......................................................................................................5
The marketing environment.........................................................................................................5
SWOT..........................................................................................................................................5
PESTLE Analysis:.......................................................................................................................6
Porter’s Five Forces Model:........................................................................................................8
Marketing Mix:............................................................................................................................9
Marketing Segmentation............................................................................................................10
Creation of Value by Tesla............................................................................................................10
Value chain analysis - Tesla......................................................................................................10
Operations Management and marketing of Tesla......................................................................12
Conclusion.....................................................................................................................................14
Recommendations..........................................................................................................................14
References......................................................................................................................................16

Introduction
Operation management is related to performing the activities in an efficient manner by
using effective tools & techniques. It is about using efficient tools and techniques in order to
minimize the issues and produce quality products efficiently. In operation management, several
activities are performed so that raw material can be transformed in finish goods in an efficient
manner. In organizations, managing operations efficiently is crucial in order to administer the
business practices in order to create high values (Victorino and et. al., 2018). In addition, it is
possible to produce quality goods by implementing appropriate operation management tools.
Marketing is an art of preparing attractive advertisement and promotion campaigns in order to
grab the attention of buyers. Main aim of marketing is to enhance the sales and profitability of
the organization by gaining the attention of the customers. In addition, it also helps in setting a
unique and different image of the company in market place. further, marketing also provides
competitive edge to the entity over competitors. By managing effective marketing practices, it is
possible to earn substantial amount of profit efficiently. Also, marketing improves the brand
image of an entity and further make them enable to meet with the requirements of the buyers
efficiently (Ferdows, 2018). The present study is about TESLA that is a renowned organization
based of United States of America. It is known for the evolution of electric vehicles across the
globe. It was founded in 2003 and has been made remarkable presence in different countries
globally. Main aim of the current study is to analyze marketing & operation management of
TESLA. It aims to identify the effectiveness of marketing and operational strategies of the
respective company. For this purpose, it will cover various models such as PESTLE, SWOT,
Porter’s five forces etc. Further, the study will include market segmentation of the organization.
Also, value chain analysis of the entity has been covered in the given study. Additionally, there
are necessary recommendations will be included in the report so that the company can grow and
succeed in the future period of time.
Background of TESLA
TESLA is a renowned automotive company which is known for the launch of electric
vehicles with an aim to bring transformation within the industry. The organization is based on
United states of America and was founded in the year of 2003. Elon musk is the CEO of the

organization who is also one of founders of TESLA. The market share of the organization is
increasing rapidly. As a result, it has become the most valuable company in the automotive
industry. In 2021, the total revenue of the organization was 31.5 billion $ and they recorded the
growth of 157% in the same year (Tesla - statistics & facts, 2021). Main aim of the entity is to
facilitate the sustainability for the betterment of society and the environment. Here, TESLA
significantly contributes towards sustainable development of environment which differentiae
them from other competitors. Additionally, the development of electric vehicles is one of the
major advantage of the organization over its rival firms.
Market & Environment analysis
The marketing environment
Marketing environment of TESLA is effective as it is based on the trust and faith of the
customers. Here, TESLA is prestigious brand hence they do not advertise in newspapers, TV
and more. Rather, the publicity is done by Word of mouth. Customers have faith on the brand
thus they not only purchase it but also advice to the other people to go for the respective brand.
In this context, the company also has referral program rewards for those who share their
experience with others. Additionally, the organization focuses on maintaining long-term
connections with the community. For this purpose, TESLA has solid user focus which includes
consumer forum and the owner club. By this, the entity is able to build loyalty and trust among
the customers (Rojas, 2020). Therefore, the marketing practices of the organization is based on
trust, loyalty, connectivity. In this context, they also significantly contributes in social &
environmental development. The positive image of brand helps in gaining the attention of buyers
and also provides an edge to the company over its competitors.
SWOT
Strengths Weakness
TESLA is the most valuable company of
automotive industry. The brand is growing
rapidly and has been recorded the growth of
157% in 2021(Tesla - statistics & facts, 2021)
The company is highly concern regarding the
Following high standards regarding innovation
that can further become the reason of
manufacturing complications and production
risk. TESLA is facing the issue related to delay
in launch, production and more.

environment. Here, sustainable efforts of the
brand helps in establishing an unique image in
the market in an efficient manner.
TESLA is the best brand in the category of
electric vehicles. It is proven the cars of
TESLA are capable in covering maximum
distance that is the major strength of the
organization.
The brand sometimes face the issue of
unbalance in demand and supply which will
affect the brand image negatively.
However, the company is engaged in
production of creative and innovative products
but they are lacking in terms of volume of
production.
Opportunities Threats
It is possible to expand the business in
untapped market. The company has presence in
nearly 38 countries hence still, there is scope of
development in global market.
TESLA is highly expensive hence they cannot
target to the huge segment of the customers. In
this regard, the brand is required to reduce
down the production cost so that they can
target to the huge segment of customers.
TESLA is facing intense competition in the
automotive industry due to the presence of
rival firms. There are alternative of both fuel
vehicles and self-driving technology. Here, the
competition might hamper the future growth
opportunities of the respective brand.
Due to high innovation and engineering
techniques the brand faces issues related to
product defects. These cases put a drastic
impact on the brand image of the entity.
PESTLE Analysis:
This is a model that is used to analyze the external conditions of a company. Here,
different factors of macro environment are studied so that the organization can prepare suitable
strategies in order to survive in the uncertain environment efficiently. In context of TESLA, the
company is highly affected by the macro aspects. In this context, the forces are mentioned
below:
Political Factors: It comprises the political conditions,
regulations of government of the country (Hill,
2020). In context of TESLA, they are working

in different countries globally hence the brand
is affected by change in the political
environment of different nations. The
economical cycle gets change due to the
impact of political events which further
influence the operations of the respective
entity. However, the company is getting
subsidies and other assistance by the
government which can adopt as an opportunity
for future growth.
Economical Factors: This factor comprises economical
elements such as inflation, interest rate,
exchange rate and more (Zhang and et. al.,
2021). In context of TESLA, they are working
in developed countries like UK, America and
so on. Here, the company is able to manage
high sales in developed countries as people are
capable enough to spend on expensive cars.
Also, people of developing nations cannit
afford such an expensive vehicles.
Social Factors: It includes social elements like attitude,
perception, personality of customer groups. In
context of TESLA, it is possible to gain the
attention of high –income people who can
easily pay large amount for the brand name.
Additionally, the company has been leveraged
the current shift in the perception of customers
by providing electric vehicles efficiently.
Technological Factors: In current era, it has become the most

crucial element due to the enhancing demand
of technology (Nag, 2019). TESLA is one of
the highly innovative companies which
offering electric vehicles based on the latest
technology. Recently, the brand has launches
self-driving cars which is based on software
and advance technology. This technological
developments will help the entity in ensuring
growth and sustainability in the current
competitive market.
Legal Factors: These elements are related to follow
necessary rules, regulations and compliances in
order to run the business smoothly (Chambers,
2019). In context of TESLA, they are required
to follow international patent & copyright
laws. Additionally, there are certain states like
Nebraska, Georgia and more has banned the
direct sales of TESLA vehicles (EV rivals
Tesla, Rivian unite to target direct sales
legislation. 2021). Further, several allegations
and lawsuits also put a major negative impact
on the brand image of the entity.
Environment Factors: In current time each and every company is
required to follow the necessary laws of
environmental protection & sustainability. In
this context, TESLA is one of the most
sustainable brands. The major reason of
producing EV is to reduce down the
environmental pollution cause by the

traditional vehicles.
Business model canvas:
(Source: Business model canvas of Tesla, 2021)
Porter’s Five Forces Model:
This model is implied in order to assess the level of competition, position of rivals,
growth opportunity in an industry. After assessing the industry, it is easy for a company to
determine the growth potential in future (Chowdhury and Naheed, 2020). In context of TESLA,
it is working in highly competitive market. In this context, the major forces of the respective
model are given below:
Threat of new entrants: new entrants are the firms which can enter into the existing
market and has the potential to affect the operation of the existing firms. In context of TESLA, it
is well-established brand which has positive image in the market. It is quite complex for a new
firm to compete with the respective brand. For new firms, it is difficult to compete with the
strong brand value of TESLA. Also, there are other barriers in the automotive industry such as
high initial investment, government regulations, license and more. Therefore, threat of new
entrants is lower due to higher number of entry barriers in the industry.

Bargaining power of buyers: This force is related to the power of buyer to affect the
profitability of a brand (Pryce, 2020). In case of TESLA, bargaining power of buyers is
moderate due to presence of other players in the automotive industry. Also, switching cost is
also lower hence the customers can easily switch over another brand. However, it is quite
difficult to get substitute for the electric vehicles of TESLA which keep the barraging power of
customers at moderate level.
(Source: Porter’s five forces model, 2021)
Bargaining power of suppliers: In automotive industry, business depends on the
reliability of the suppliers. Hence, the suppliers have the power to affect the industry profoundly.
It is analyzed that majority suppliers do not directly provide material to TESLA. Rather, they sell
it through third parties. Therefore, the suppliers have moderate power to affect the company.
Threat of substitute: In the industry, there are other companies such as Toyota and
more which are also offering electric vehicles (Shukla and Pattnaik, 2019). Also, the switching
cost in the industry is also lower. Therefore, threat of substitutes for TESLA is high due to
presence of strong competition in the industry.

Competitive rivalry: TESLA works in highly competitive market as there are various
companies present in the automotive industry. However, the company is really ahead in terms of
innovation and creativity which allows them to stay in the competitive environment for longer
duration.
Marketing Mix:
For TESLA, the public image of the brand is the most valuable marketing strategy. To
understand the marketing aspects of the company in detail, elements of marketing mix are briefly
explained below:
Product: TESLA is the leader in producing eco-
friendly and sustainable vehicles. The major
product of the brand is electric vehicles. Along
with this, it also produces sustainable energy
technologies like batteries, solar pane and
more. It has been launched different models of
EV such as Model S, Model X, Model 3 and so
on. The main aim of developing such model is
to facilitate innovation in the automotive
industry.
Price: In this context, TESLA is a sophisticated brand
which is categorized under premium pricing
strategy. The company spends huge amount on
research & development, resources and
development of innovative vehicles
(Belvedere, Tunisini and Martinelli, 2020).
Hence, they charge high price from the
customers in order to manage the cost.
Place: TESLA is headquartered in United States of
America. However, the brand has presence at
different locations globally. The brand has

nearly 438 stores along with 10 service centers
globally. They are working in nearly 34
countries and ensure to cater the needs of target
segment. Additionally, the company enters at
high end of the market where customers can
easily pay the premium price.
Promotion: The company is not involve in any marketing
and promotion campaign. The word of mouth
is the major strategy which is used by the
company (Zlatev, 2018). Here, the brand has
been made positive image among the
customers over the period of time. It makes the
brand unique and different from its
competitors.
People: TESLA is a well-known brand who hire
potential and qualified individuals to work
with the company. All the employees of the
entity are well-qualified and efficient enough
to contribute in the future success (Sabel and
et. al., 2020).
Process: The batteries for TESLA car is made by the
company as they can control the cost by
making the batteries on their own. Apart from
this, the process of car manufacturing has been
revolutionized by Elon Musk in an efficient
manner.
Physical evidence: TESLA does not operated business through
intermediaries. The showrooms of the
company are well-equipped and have attractive
interior & designing. Additionally,