Strategic Marketing Management of Tesla Inc. - Derby University

This report provides a comprehensive analysis of Tesla Inc.'s strategic marketing management. It begins with an introduction to Tesla's background and objectives, followed by a critical analysis of the marketing environment using PEST and Porter's Five Forces models. A SWOT analysis highlights Tesla's strengths, weaknesses, opportunities, and threats. The report then delves into market segmentation, targeting, and positioning strategies, including a perception map and the 4Cs of positioning. Furthermore, it examines strategies for growth and marketing objectives using the BCG Matrix and Ansoff Matrix, outlining short-term, medium-term, and long-term SMART objectives. The report also discusses how these objectives meet stakeholders' needs and concludes with an analysis of Tesla's marketing mix (4Ps), providing a thorough evaluation of the company's marketing approach. This document is available on Desklib, a platform offering a wide array of study resources including past papers and solved assignments.

Strategic marketing management
TESLA INC. (Coursework- 2)
Student’s name

Introduction
(Source: Cheney, 2011)
Tesla Motors is one of the automobile manufacturing industries. This company was started
for the development of the electric sports car. The Elon Musk as CEO of this former
company has launched Tesla in 2003. The main purpose of the organization was to encourage
innovation and ethical values. The main goals of the Tesla Company are to generate an entire
ecosystem, and as a manufacturer, an ideal set of the energy solution, power wall, power back
and the solar roof are maintained and helps in managing the renewable energy generation,
storage, and consumption (Higgins, 2016).
The objective and the main motive behind this report is to evaluate and review about Tesla
Company. What all we understand from their marketing strategies, their marketing analysis,
what all strategies in the context of segmentation, targeting and positioning of the firm, for
the further improvements to be made as well as, what all the company can to increment their
reputation world widely (Cheong, Song, and Hu, 2016).
The marketing environment
Critical Analysis
In PEST, analysis, the external environment variables from political, economic, social and
technological evaluate that there are numerous opportunities and risk associated with the set
strategies and they needed to be changed which can leads to the significant transformation of
Tesla Inc. especially in long run aspect (Popović, et al, 2015).

In political and social concern government specific roles help in generating opportunities for
improving their financial future aspects moreover, they are also expanding themselves
internationally or worldwide as in terms of technology, innovation and in sustainable
concern, they stand first as compared with the other companies. Moreover, Elon Musk is also
trying harder to be more social to customers. So that they can make aware people about the
electric cars and on what theme, they are setting future, educating them about the strategies
which they have adopted to make customers aware that the products are meant according to
their needs, wants, and demand and also for overall society too (Karamitsios, 2013).
In a technological aspect, the company is earning a lot because due to the adoption of the
technology which helps in forming electric cars which none other company forms without
harming the environment and adopting sustainable aspects which generate company
competitive advantage over the others. Lastly, the main important aspect of the company are
the customers and the general public, their demands, needs, and wants for which Tesla
company always took care of.
In Porter's five-force model, the analysis states that the structure of Tesla seems to be
favorable in many cases as it leads to the company’s future growth. Alternatively, this
automotive market is very much competitive and attractive for all the automaker companies.
Similarly, in rivalry terms, the competition will be even more intense because other
companies are now focusing on keeping innovative, improving and making better cars. In
terms of substitutes, Tesla will be irreplaceable for their loyal customers as what they
provide as facilities none other transports providers. Moreover, now people to prefer to have
their own cars as that is more convenient to them. Furthermore, the threat of new entrant is
high and generates risk because now every firm is moving towards sustainable approach and
government is supporting to all firms for developing electric vehicles as they are economic
friendly and linked with sustainability. Lastly, in terms of suppliers tesla is highly dependent
on suppliers, which generates issues with the delivery components which results in
production disruption, which negatively affects the company reputation (Schoenfeld, 2014).
A SWOT analysis, Highlights that Tesla, in recent times, the company will robust their sales
as they having a competitive advantage over the other companies. This is all because of their
brand recognition which they having in the market. Moreover, they are more focused on
sustainable innovation. By adoption of all such factors tesla is on growth stage and have
become stronger and an experienced company as compared to the other automotive

companies. However, other than this, Tesla also faces weaknesses such as poor customers’
awareness, higher competition and due to the higher prices leads to low affordability (Fobes,
2015).
With these weaknesses, certain threats are also highlighted likewise; higher competition due
to the high price of Tesla motors and general people will be more focused on other brands. In
addition, as cars cost is higher similarly, their cost for the services are also higher.
Nevertheless, certain opportunities are associated with it as if Tesla is thinking of global
expansion through diversifying its business. It is natural that with the diversified business will
give more preferences to new technology are done by doing this, Tesla Company will grow
its demand for sustainable products (Sharma, 2016).
Positioning and Targeting
The effectiveness of these market segmentation and attractiveness of the market
The effectiveness of this market segmentation done by Tesla is because it helps them in
finding the people attitude towards the economy and environment. Accordingly, the
segmentation is done. The main thing about Tesla is that they use a concentrated
segmentation strategy. The company does not try to attract their customers by engaging in the
mass marketing campaign (Bhasin, 2018).
Market
Segmentation
Geographic Demographic Behavioural

In demographic segmentation, according to the age and their preferences are known from
such segmentation. Likewise, for example, Tesla is more focused towards millennials as now
they are innovating something, which is meant for them through innovation. Moreover,
geographic segmentation highlights about the taste and the preferences according to
geographic or regions taste of the individuals. Alternatively, Tesla Company concentrates
accordingly. Lastly, behavioral segmentation highlights about the customer's loyalty,
behavioral patterns, and repetitive or non-routine consumption. Hence, it will be easier for the
company to generate more innovative techniques in order to attract more of customers
Moritz, et al, 2015).
According to my opinion, target market should be the millennials and the strategy they
should set the various prices and allow to attract them should work over their requirements,
needs, preferences, taste, and easiness in handling the cars, which they want.
Current positioning in the target market:
Tesla’s unique position is on auto car market, which helps them in achieving the particular
target. Moreover, the current target market of tesla highlights about the purchases made for
model S that was priced 70k for those who are tech savvy and are green friendly. Moreover,
the Model S has also considered aa luxury car with the best performances, which simply
added to the fully electric cars without scarifying the styles, and performances (Chen, and
Perez, 2018).
Perception map of Tesla Inc. Positioning

(Source: Chen, and Perez, 2018)
(Source: Chen, and Perez, 2018)
4C’s of positioning to access the effectiveness of the Tesla positioning strategy
Clarity
In Tesla concern, there should be clarity and
a clear vision of the particular product and
the target market
Consistency
Inconsistency aspect, the message should be
or must be consistent throughout all the
aspects in relation to the product.
Competitiveness
In competitiveness concern, the company
should develop something new and attractive
which is different from the other companies
Likewise, in terms of Tesla, in reputation
concern, they serve customers in a direct and
honest way but not to just take their money.
Creditability
Creditability comes for the services which
they offer to the ultimate customers Likewise
tesla sometimes ago delivers fr6ee
supercharging to their buyers in order to
retain them for a longer time (Schoenfeld,
2014)

Strategies for growth and marketing objectives
BCG Matrix of Tesla
(Source: Mangram, 2012)
BCG Matrix framework is helpful in evaluating the strategic position of the company by its
brand portfolio into four different categories likewise, industry attractiveness, and
competitive position of the company. In Tesla company concern, it is on the question mark
stage as the earning and the profits are done by the company in current years and are growing
at a faster pace. However, the matrix also highlights that the cash flow is currently negative
and its strategy is to invest more in order to improve overall. The below image highlights that
Tesla currently in is suspense with its upcoming market growth (Mangram, 2012).

(Source: Mangram, 2012)
Tesla’s Ansoff matrix
(Source: Carlson, 2013)
Tesla growth strategies are revealed in these four ways:

Market Penetration: This particular strategy highlights about the selling of the existing
products into an existing market. As Tesla thinks of selling their Models such as Model X,
Model S, as well as solar panels, inverters, electric hardware and monitoring devices in all
29 countries for their growth.
Product development: This strategy highlights the development of the newer product in
order to sell them in the existing market. Tesla not easily develops its product easily due to its
higher cost in electric vehicles and the power storage sectors.
Market development: Market development strategy highlights the development of the newer
market for the existing products. Likewise, Tesla is now trying to tap India. As according to
Elon Musk, tapping the Indian market will be a strategically appropriate decision as it is the
third largest auto market in the world. All this will be done by 2020 (Stringham, et al, 2015).
Diversification: In this diversification aspect, the company earlier manufactured electric
vehicles, and then Tesla tapped and purchased a solar company in 2016 in order to enter the
energy storage sector. The alternative fuel vehicles manufacturer is the further efforts made to
diversify and manages to overcome its current severe financial issues (Carlson, 2013).
SMART Objectives- Short-term, Medium-term and long-term
SMART
Objectives/
Time period
Short Term Medium term Long term
Specific In this, the main
specific goal of Tesla
is been innovate in
current times.
Practice going further
in innovation
likewise the green
environment etc.
In a long run, they
are thinking of going
innovative in electric
cars along with the
sustainable touch
Measurable It was planned to
generate demand for
electric vehicles so it
was measured that it
is done within the
shorter period.
In this, they need to
measure the existing
customers’ base in
order to generate
loyalty and
customers
recommendations.
Building long-term
awareness and
managing corporate
reputation.

Achievable Achieving the mass
market
competitiveness
They thought of car
which changes lanes
automatically in 2015
and they achieved it.
Their long-term goal
is to tap India as it is
on the third position
in the aspect of
electric concern.
Relevant Educated customers
about Tesla goals in
order to improve the
future
Focusing on the
market share and
strategies to improve
overall
An eye towards the
future is the long
term goal of Tesla
Timed Educate, inspire and
empower within no
time to their
customers
Rather than focusing
on profits should
focus on the
improvements made
are the medium term
goals by 2020
Focusing on the next
level as well as
earning more of
profits with
maintaining a
reputation for the
long run (Mindtools,
2018)
How these objectives help in meeting stakeholders’ needs
Tesla’s stakeholders include investors, directors, employees, suppliers, partners, public and
lastly the financial institutions. If the set objectives are full filled by the organization within
no time or the set period, then the company will definitely earn a lot of a lot of profits and
with the profits, the company would get extra earning to improvise themselves further. For
employees more of salaries, Suppliers with more orders, partners in benefits with overall
earning, and lastly financial institution are free from bad-Debt issues or the repayment of
taken loans.
The marketing Mix
4 P’s analysis of Tesla Inc.
Product
According to the analysis in product
formation by Tesla should be more
Price
In price, affordability matters a lot. Due to
the uniqueness of their products, the high rise

diversified likewise, solar panels, inverters,
electric hardware, and monitoring devices so
that they can tap more of products and
ultimately leads to the improvement in
overall growth.
in price is natural. However, in order to
generate accessibility of the products they
have to make it affordable that lies in the
range of middle level.
Place
Thinking of targeting India as their next
profit generation is a good tap but currently
targeting India would be a bit difficult as
Indian’s population is more of middle-class
people, which would be a bit risky for Tesla
to earn more.
Promotion
Tesla should focus on direct marketing and
personal selling aspect so that they can know
more about the customers’ perceptions,
moreover about their needs, wants, and
influences (Folschette, 2017).
Budget Measurement and control of Tesla
Key Performance
Indicators
Explanation Cost estimation
Revenue
Increases
With the new projects,
revenue increment is natural.
In Tesla concern, with the
more diversified product
formation, more of revenue is
generated
As people are now more
aware of nature and so with
products which Tesla forms
(Sustainable products)
In this with the newer
concept leads to the higher
cost
Higher the cost higher will be
the returns in the future.
Suppose normally cost is
1crore, but now the
additional feature of
sustainable aspect cost 20
lakhs more than the overall
cost will be 1crore, 20 lakhs.
Then in the future, the

revenue generation will be
more than the cost covered
currently. (more than
1crore,20lakhs)
Web traffic Web traffic highlights about
the customers who have
visited the company
webpage, how many times,
and the number of pages
In this the main benefit
associated with which it
helps in generating success
by- paying less to digital
marketing cost and naturally
they are tapping the
customers and triggering
their minds with their
products offerings on site
(Mangram, 2012).
Social media
Likes
Social media comprises of
Instagram, Twitter and many
more.
Nowadays the most authentic
way is to do social media
marketing likewise, Tesla
uses Twitter for customers’
engagement and for the
customer's services, social
listening. In addition, uses
Instagram to connect with the
customers.
By this, the advertisement
cost is saved by the company
Conclusion
The above report highlights about the business plan of Tesla in which the analysis of Tesla’s
marketing strategies, SWOT analysis, and porter’s five-force model, which states that what
all techniques and strategies they should adopt in order to generate more of success.

Moreover, the perception map also highlights the current market positioning of Tesla in the
market. For this, 4 c’s which are clarity, competitiveness, creditability, and consistency are
the approaches are taken into consideration in order to improve the situation of the company.
Lastly, the cost estimation according to the key performance indicator is measured in order to
improve and generate success of the Tesla Company (Hanlon, 2015).
References
Bhasin, H. (2018) Marketing strategy of Tesla [Online] Available from
https://www.marketing91.com/marketing-strategy-of-tesla/ [Accessed 17/02/2019]
Carlson, W.B., (2013) Tesla: Inventor of the electrical age. Princeton University Press
Chen, Y. and Perez, Y., (2018) Business model design: lessons learned from Tesla Motors.
In Towards a Sustainable Economy (pp. 53-69). Springer, Cham
Cheong, T., Song, S.H. and Hu, C., (2016) Strategic alliance with competitors in the electric
vehicle market: tesla motor’s case. Mathematical Problems in Engineering, 2016
Fobes. (2015) Tesla’s unique position in the car market is one of its biggest strength [Online]
Available from https://www.forbes.com/sites/greatspeculations/2015/07/02/teslas-unique-
position-in-the-car-market-is-one-of-its-biggest-strengths/#66eb835d3ad7 [Accessed
17/02/2019]
Folschette, C. (2017) Tesla’s successful marketing strategy shows that its time for CEO to get
social [Online] Available from: https://www.talkwalker.com/blog/tesla-marketing-strategy-
social-ceo [Accessed 17/02/2019]
Hanlon, A. (2015) the 4c’s marketing model [Online] Available from
https://www.smartinsights.com/marketing-planning/marketing-models/4cs-marketing-model/
[Accessed 17/02/2019]
Karamitsios, A., (2013) Open innovation in EVs: A case study of Tesla Motors, (1), pp. 198-
341
Mangram, M.E., (2012) The globalization of Tesla Motors: a strategic marketing plan
analysis. Journal of Strategic Marketing, 20(4), pp.289-312

Mindtools. (2018) SMART Goals, how to make your goals achievable [Online] Available
from https://www.mindtools.com/pages/article/smart-goals.htm [Accessed 17/02/2019]
Moritz, M., Redlich, T., Krenz, P., Buxbaum-Conradi, S. and Wulfsberg, J.P., (2015) August.
Tesla Motors, Inc.: Pioneer towards a new strategic approach in the automobile industry
along the open source movement?. In 2015 Portland International Conference On
Management Of Engineering And Technology (pp. 85-92)
Popović, S., Tošković, J., Macura, R., Aničić, J. and Aničić, D., (2015) The Importance Of
Evaluation Of Risk Management In Business. Analele Universităţii Constantin Brâncuşi din
Târgu Jiu: Seria Economy, 1(1), pp.83-89
Schoenfeld, L. (2014) Tesla Model S [Online] Available from:
https://prezi.com/7fmuvpm7p4gm/tesla-model-s/ [Accessed 17/02/2019]
Sharma, S., (2016) the Tesla Phenomena. A Business Strategy Report, 1(1), pp.89-111
Stringham, E.P., Miller, J.K. and Clark, J.R., (2015) Overcoming barriers to entry in an
established industry: Tesla Motors. California Management Review, 57(4), pp.85-103
Tesla. (2013) the mission of Tesla [Online] Available from:
https://www.tesla.com/blog/mission-tesla [Accessed 17/02/2019]
Vynakov, O.F., Savolova, E.V. and Skrynnyk, A.I., (2016) Modern electric cars of Tesla
Motors Company. Automation of technological and business-processes, (Volume 8), pp.9-18