UC Berkeley Extension
Strategic Marketing -Professor Jim Prost
August 28th, 2013
Byron Pittam / Laura DellaGuardia /
Lisan...
Introduction
Tesla	
  Motors	
  is	
  an	
  automobile	
  
company	
  that	
  strives	
  to	
  ween	
  the	
  
industry	
 ...
Per Elon Musk
h9p://www.teslamotors.com/blog/secret-­‐tesla-­‐motors-­‐master-­‐plan-­‐just-­‐between-­‐you-­‐and-­‐me	
  ...
Corporate Strategy
§  More	
  EV’S!	
  
² Company-­‐owned	
  dealerships	
  
² License	
  electric	
  powertrain	
  com...
2003 2008 2009
§  Founded	
  
2006
§  Prototypes	
  of	
  the	
  
Roadster	
  introduced	
  
to	
  the	
  public	
  
§ ...
2010 2011 2012 2013 2014
§  Strategic	
  Partnership	
  
announced	
  with	
  
Toyota	
  	
  
§  IniEal	
  Public	
  Offe...
Other Electric Cars
§  Chevrolet	
  Volt	
  
§  Nissan	
  Leaf	
  (75,000	
  as	
  of	
  August	
  2013)	
  
§  Mistubi...
Other Electric Cars
§  Chevrolet	
  Volt	
  
§  Nissan	
  Leaf	
  (75,000	
  as	
  of	
  August	
  2013)	
  
§  Mistubi...
TOP Markets
Japan 28%
USA 26%
China 16%
France 11%
Norway 7%
9-28
Tesla Financials
§  $20	
  billion	
  market	
  capitalizaEon,	
  August	
  2013	
  
§  10	
  year	
  old	
  company	
  ...
Target Audience
§  Wealthy	
  and	
  trendy	
  early	
  adopters,	
  	
  
§  Successful	
  professionals/entrepreneurs,	...
Target Audience
Mark,	
  27	
  years	
  old,	
  lives	
  in	
  the	
  Silicon	
  Valley,	
  where	
  
created	
  his	
  ow...
Penetration Strategy
“Tesla's	
  strategy	
  is	
  similar	
  to	
  that	
  pursued	
  by	
  
cell-­‐phone	
  and	
  flat-­...
Product attributes
§  “Design-­‐performance-­‐energy	
  
efficiency”	
  
§  No	
  dealers	
  (the	
  price	
  is	
  the	
 ...
Models
15-28
Model x
16-28
PositioningBurningFuelCars
ElectricCars
Luxury Cars
Valueable Cars
§  Tesla	
  is	
  posiEoned	
  as	
  
a	
  high-­‐end	...
Product attributes
“More	
  than	
  any	
  other	
  company,	
  Tesla	
  has	
  helped	
  
transform	
  the	
  popular	
  ...
KSF
§  Quality	
  and	
  design	
  of	
  the	
  cars;	
  
§  Company	
  operaEonal	
  efficiency	
  and	
  costs;	
  
§  ...
SCA’s
§  Technology	
  
§  Ecosystem	
  
§  Excellent	
  Performing	
  Car	
  
20-28
Promotion
“Tesla	
  Motors	
  has	
  no	
  adver;sing,	
  
no	
  ad	
  agency,	
  no	
  CMO,	
  no	
  dealer	
  
network.	...
Promotional activities
§  Social	
  media;	
  
§  Word	
  of	
  the	
  mouth;	
  
§  Website;	
  
§  Trade/auto/motor	...
SWOT Analysis
Opportunities Threats
Strengths
§  Well	
  known	
  CEO	
  with	
  good	
  track	
  record	
  	
  
§  Uses...
Marketing Strategy
Tesla the ‘Challenger and Rule Breaker’
§  Performance	
  through	
  technology	
  
§  New	
  sales	
...
Options
① Stay	
  as	
  is,	
  conEnue	
  on	
  the	
  revoluEonary	
  path.	
  
② Stay	
  in	
  line	
  with	
  their	
  ...
Tesla Summary Assessment
	
  	
   AlternaEves	
  (RaEng)	
  
	
  	
  
RelaEve	
  
Weights	
   OpEon	
  1	
   OpEon	
  2	
 ...
Recommendations
§  Nissan	
  Leaf	
  is	
  leading	
  the	
  market	
  
§  CEO	
  is	
  crucial	
  to	
  new	
  vision	
...
Questions?
28-28
Tesla Superchargers
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Strategic marketing For Tesla Motors - UC Berkeley Extension

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Final Project created for Strategic Marketing class with Jim Prost, UC Berkeley Extension. (August 28th, 2013)

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Strategic marketing For Tesla Motors - UC Berkeley Extension

  1. 1. UC Berkeley Extension Strategic Marketing -Professor Jim Prost August 28th, 2013 Byron Pittam / Laura DellaGuardia / Lisandra Maioli / Ryan Shi / Svetlana Fedorova
  2. 2. Introduction Tesla  Motors  is  an  automobile   company  that  strives  to  ween  the   industry  off  oil-­‐based   combus3on  engines.         They  seek  to  create  cars  that   are  fun,  environmentally   friendly,  inspire  others  to   do  the  same  and  drive  the  car   industry  forward.   2-28
  3. 3. Per Elon Musk h9p://www.teslamotors.com/blog/secret-­‐tesla-­‐motors-­‐master-­‐plan-­‐just-­‐between-­‐you-­‐and-­‐me     §  Build  sports  car   §  Use  that  money  to  build  an  affordable  car   §  Use  that  money  to  build  an  even  more   affordable  car   §  While  doing  above,  also  provide  zero   emission  electric  power  generaEon   opEons   §  Don't  tell  anyone.   So,  in  short,  the  master  plan  is:   3-28
  4. 4. Corporate Strategy §  More  EV’S!   ² Company-­‐owned  dealerships   ² License  electric  powertrain  components     ² Inspire  other  car  manufacturers     §  Premium  product  (Roadster)     ² Trickle-­‐down  technology   ² Use  of  early-­‐adopters  (Silicon  Valley)   §  Take  it  to  the  mass  market!   ² SUV-­‐crossover  and  mini-­‐vans     ² Cargo  vans  for  commercial  &   government  use.     ² $30k  target  model     4-28
  5. 5. 2003 2008 2009 §  Founded   2006 §  Prototypes  of  the   Roadster  introduced   to  the  public   §  Global  Green   product  Design   Award  for  Roadster   §  RecogniEon  by  Time   Magazine  -­‐  “Best   InvenEons  -­‐   TransportaEon   2007 §  Index  Design  Award   for  Roadster   §  Two  batches  of  100   Roadsters  sell  out   fast   §  Full  producEon   begins  on  the     Roadster   §  December  -­‐  100th   Roadster  delivered   §  Opened  first  retail   store  in  Los   Angeles,  second  in   Menlo  Park   §  Unveiled  the  Model   S,  March  26,  base   price  $57k   §  Opened  European   showrooms;  London,   Munich,  Monaco   Milestones 5-28
  6. 6. 2010 2011 2012 2013 2014 §  Strategic  Partnership   announced  with   Toyota     §  IniEal  Public  Offering   §  Opened  Japan  &   Australia  showroom   §  ConEnued  with   European   showrooms  in   Zurich,  Copenhagen,   Paris,  Milan   §  Stopped  taking   Roadster  orders   §  Opened  Hong  Kong   showroom   §  Commercial   deliveries  of  the   Model  S  begin   §  Unveiled  Model  X   §  Began  building   Supercharger   staEons   §  Small  price  increase   announced  for   Model  S   §  Model  S  wins     ²  Motor  Trend  Car  of   the  Year   ²  Automobile   Magazine’s    Car  of   the  Year   ²  Time  Magazine’s   Best  25  InvenEons  of   2012   §  Push  to  be   profitable...SUCCESS!   §  Musk  promises  US  to   be  covered  with   Supercharger   staEons  (18  today)   §  First  parEal  recall   §  Model  X  will  enter   producEon   §  80%  of  US   populaEon  covered   by  Supercharger   staEons   milestones 6-28
  7. 7. Other Electric Cars §  Chevrolet  Volt   §  Nissan  Leaf  (75,000  as  of  August  2013)   §  Mistubishi  i-­‐MiEV  (30,000  as  of  June  2013)   §  Honda  Fit  EV   §  RAV4  EV   §  Renault  Zoe   §  Roewe  E50   §  Scion  iQ  EV   §  Chevrolet  Spark  EV   §  Smart  ED   §  Tesla  Model  S  (12,700  as  of  June  2013)   20  total  models  of  highway  capable  EVs   7-28
  8. 8. Other Electric Cars §  Chevrolet  Volt   §  Nissan  Leaf  (75,000  as  of  August  2013)   §  Mistubishi  i-­‐MiEV  (30,000  as  of  June  2013)   §  Honda  Fit  EV   §  RAV4  EV   §  Renault  Zoe   §  Roewe  E50   §  Scion  iQ  EV   §  Chevrolet  Spark  EV   §  Smart  ED   §  Tesla  Model  S  (12,700  as  of  June  2013)   More  than  150,000  total  vehicles  have  been  sold  since  2008   TOP Selling 8-28
  9. 9. TOP Markets Japan 28% USA 26% China 16% France 11% Norway 7% 9-28
  10. 10. Tesla Financials §  $20  billion  market  capitalizaEon,  August  2013   §  10  year  old  company  is  worth  more  than  Mazda,  Suzuki  and  Fiat   10-28
  11. 11. Target Audience §  Wealthy  and  trendy  early  adopters,     §  Successful  professionals/entrepreneurs,     §  Upper  middle  class  city-­‐dwellers,     §  Tech-­‐savvy  and  green-­‐friendly      (eco-­‐hipsters)      "For  that  target  audience  (wealthy  and  tech-­‐savvy   niche  group),  the  more  exclusive,  the  more   expensive,  the  more  exo;c,  the  be=er,"       Phil  Go9,  senior  director  of  long  range  planning     for  IHS  AutomoEve.     h9p://news.naEonalgeographic.com/news/energy/2013/05/130522-­‐tesla-­‐motors-­‐success/     11-28
  12. 12. Target Audience Mark,  27  years  old,  lives  in  the  Silicon  Valley,  where   created  his  own  start-­‐up  when  he  was  just  21.     He  makes  a  bunch  of  money  with  his  Tech  business,   loves  luxury  brands,  he  buys  products  by  its   performance  and  design  and  is  constantly  a=en;ve   to  the  new  launchings  in  the  tech  area  and  is  always   the  first  person  in  his  group  buying  the  cuKng-­‐edge   products.  He  is  also  concerned  about  having  a   healthy  life  and  being  green.   Persona: 12-28
  13. 13. Penetration Strategy “Tesla's  strategy  is  similar  to  that  pursued  by   cell-­‐phone  and  flat-­‐screen  TV  makers,  which   started  off  selling  their  products  to  wealthy   early  adopters  then  cut  prices  to  mainstream   levels  as  the  technology  developed.”     Rachel  Konrad  ,  Tesla's  spokeswoman         h9p://www.nbcbayarea.com/the-­‐scene/shopping/Abu-­‐Dhabi-­‐Joins-­‐Feds-­‐as-­‐Tesla-­‐Investor.html     13-28
  14. 14. Product attributes §  “Design-­‐performance-­‐energy   efficiency”   §  No  dealers  (the  price  is  the  price:   no  negoEaEon)  or  commissioned   sales  person   §  TransacEons  being  conducted   online   14-28
  15. 15. Models 15-28
  16. 16. Model x 16-28
  17. 17. PositioningBurningFuelCars ElectricCars Luxury Cars Valueable Cars §  Tesla  is  posiEoned  as   a  high-­‐end  green   electrical  car's   company  in  a  luxury   market  with  a  unique   customer  experience   17-28
  18. 18. Product attributes “More  than  any  other  company,  Tesla  has  helped   transform  the  popular  image  of  electric  cars  as  nerdy  golf   carts  for  do-­‐gooder  greens  to  something  that  can  be  fun   and  luxurious  and  packed  with  cuKng-­‐edge  technology.  It   pioneered  a  new  genera;on  of  electric  cars.  Whether   Tesla  can  rally  mainstream  consumers  to  the  world  of   electric  mobility,  however,  remains  to  be  seen.”     by  Josie  Garthwaite  for  NaEonal  Geographic         h9p://news.naEonalgeographic.com/news/energy/2013/05/130522-­‐tesla-­‐motors-­‐success/     18-28
  19. 19. KSF §  Quality  and  design  of  the  cars;   §  Company  operaEonal  efficiency  and  costs;   §  Supply  and  distribuEon  chain  efficiency;   §  Flexibility;   §  MarkeEng;   §  Compliance.   for Automobile Industry 19-28
  20. 20. SCA’s §  Technology   §  Ecosystem   §  Excellent  Performing  Car   20-28
  21. 21. Promotion “Tesla  Motors  has  no  adver;sing,   no  ad  agency,  no  CMO,  no  dealer   network.  And  that's  no  problem.”         Michael  McCarthy,  AdverEsing  Age   21-28
  22. 22. Promotional activities §  Social  media;   §  Word  of  the  mouth;   §  Website;   §  Trade/auto/motor  shows;   §  Tesla  brand  communiEes;   §  Product  reviews;   §  Customer  events;   §  Blogs,  forums;   §  Email  newsle9ers;   §  Press  releases;   §  CelebriEes.   22-28
  23. 23. SWOT Analysis Opportunities Threats Strengths §  Well  known  CEO  with  good  track  record     §  Uses  Tesla  Stores  instead  of  tradiEonal   distribuEon  through  dealers   §  1st  company  to  produce  a  fully  electric   luxury  car   §  Proprietary  technology   §  Based  in  SF  Bay  Area   §  Popular  in  younger  age  groups  who  are   likely  to  use  social  media   Weaknesses §  CEO  is  also  CEO/CTO  of  SpaceX   §  Infrastructure  not  yet  developed  for  electric   cars     §  Customers  are  sEll  wary  of  such  new   innovaEons   §  Price   §  Increasing  awareness  and  support  for   environmentalism     §  Large  internaEonal  market  potenEal   §  New  lower-­‐price  models  appealing  to  a   wider  range  of  customers   §  Advances  in  tech  may  increase  ba9ery  life;   spark  other  innovaEons   §  CompeEEon  from  established  auto   companies   §  Lawsuits  could  inhibit/delay  innovaEons   §  Loss  of  government  subsidies  will  drive  up   prices   23-28
  24. 24. Marketing Strategy Tesla the ‘Challenger and Rule Breaker’ §  Performance  through  technology   §  New  sales  model  and  distribuEon     §  No  tradiEonal  paid  adverEsing   §  ExcepEonally  good  at  creaEng  buzz   §  Over  achieving  results   §  Technology  needs  charging  staEons   §  Facing  distribuEon  difficulEes     §  CEO  has  split  Eme   §  Supply  and  demand:  ProducEon   §  Keeping  up  with  compeEEon   Pros Cons 24-28
  25. 25. Options ① Stay  as  is,  conEnue  on  the  revoluEonary  path.   ② Stay  in  line  with  their  high  end  innovaEve   strategy,  build  their  own  factories  so  they  no   longer  rely  on  outsourcing  producEon.   ③ Get  in  the  mass  market  family  car  game   quickly  before  it’s  too  late.   25-28
  26. 26. Tesla Summary Assessment     AlternaEves  (RaEng)       RelaEve   Weights   OpEon  1   OpEon  2   OpEon  3   Technology   .3   5   5   4   Emerging  CompeEtors   .2   1   2   5   New  CEO   .2   2   3   5   AdverEsing   .1   2   3   4   ProducEon  Outsourcing   .1   3   1   4    Geographical  Expansion    .1    3    3    4   Rela3ve  Weight  x  Ra3ng   1   2.9   3.2   4.4   Analysis 26-28
  27. 27. Recommendations §  Nissan  Leaf  is  leading  the  market   §  CEO  is  crucial  to  new  vision   §  AdverEsing  to  keep  up  with  compeEEon   §  ProducEon  outsourcing  boost   §  Geographical  expansion   Option 3 : Get in the mass market game quickly! 27-28
  28. 28. Questions? 28-28
  29. 29. Tesla Superchargers
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