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Marketing Tesla's Electric Vehicles in China
- 1. Bettery Driving Green Living! Marketing Plan in China Jie TANG, Janet! 02/2016
- 2. Background & Objective Situation Analysis STP Strategy Marketing Strategy PROJECT DIRECTORY Cost & Benefits Analysis
- 4. Market Background In 2014, sales volume of New Energy Vehicles in China is less than American market by 4,000 No.2 EV Market Chinese market is extremely promising to exceed American market and become the No.1 EV Market worldwide High Potential In metropolises of China, market potential is relatively higher than other districts Chance in Metropolis 28 cities in China are the first to promote and apply new energy vehicles Policy Support
- 5. Market Background Chinese market is extremely promising to exceed American market and become the No.1 EV Market worldwide High Potential 2015 Production Scale of New Energy Vehicles in China Category Production Scale Annual Growth New Energy Vehicles 6599 5 times BEV - passenger 2108 5 times BEV - commercial 1343 6 times Plug-in Hybrids - passenger 2278 7 times Plug-in Hybrids - commercial 870 2 times
- 6. Objective - adopt the marketing strategy of 'crossing the chasm', premium pricing combined with limited production within high-end market! ! - expand commercial EV market to enhance UX! - gain high reputation in BEV manufacturing Firstly Expand High-end & Commercial Vehicle Market - with high awareness and reputation gained in former steps, expand to mass market with solid customer resources Ultimately Occupy Mass Market - propaganda via mass media, educate customers with benefits of owning an BEV! ! - convey the message that Tesla is absolutely worth for its price Generate Demand - entry Chinese market when it's still infancy, raise public awareness at the beginning! ! - set up the image of No.1 BEV automaker Long-term Brand Awareness
- 8. PEST - Macroeconomy Society more and more appreciates environmental friendly vehicles! ! In the past 10 years, Chinese Real GDP per capita has gained 5 times dramatic growth. Social BEV technology (such as, lithium-ion batteries) is much more improved than competitors Technological Energy saving and new energy vehicles industry development plan (2012-2020)! ! National Important Development Project for New Energy Vehicles (2015) Political In 2014, sales volume of New Energy Vehicles in China is No.2 worldwide, only less than American market by 4,000! ! Chinese automakers are not capable for production and popularizing BEVs, there are few competitors Economical
- 9. SWOT - Tesla Threaten Opportunity technology, first-mover, innovation, reputation Strength Weakness cost, scale, immature market, infrastructure improving tech, rising awareness, oil price instability, government focus, environmental awareness new entrants, substitute products, large automakers, 150-year gasoline powered habit
- 10. SWOT - Tesla technology, first-mover, innovation, reputation Strength - leading-edge technologies ! ! - exceptional vehicle performance ! ! - attractive vehicle designs! ! - BEV market 'first mover' ! ! ! . ! - good reputation among BEV automakers! ! - innovative distribution/sales network
- 11. SWOT - Tesla - higher cost due to lack of significant economies of scale ! ! - lack of financial and technological resources to invest in R & D! ! - immature industry ! ! - growing but limited brand recognition within the mass-market consumer ! ! - possible component supply problems ! ! - potential production output problems! ! - electric vehicle infrastructure Weakness cost, scale, immature market, infrastructure
- 12. SWOT - Tesla - momentous advances in vehicle battery technology ! ! - rising consumer awareness of cost and environmental benefits of BEV ownership! ! - global 'peak oil' related pressures! ! - increasing governmental focus on infrastructures ! ! ! . ! - mounting anxieties about environmental pollution and global warming! ! - certain market sectors are 'niche' and largely untouched Opportunityimproving tech, rising awareness, oil price instability, government focus, environmental awareness
- 13. SWOT - Tesla - significant increase in the number of direct BEV competitors ! ! - growing number of substitutes for BEVs! ! - entry of large automobile companies into the BEV market! ! - possible major breakthrough by competitors in vehicle battery technologies! ! ! . ! - resurgent consumer apathy driven by historically demonstrated 'status quo' ! attitudes Threatennew entrants, substitute products, large automakers, 150-year gasoline powered habit
- 15. STP Strategy Middle to Higher-end sports car market: segment Introduce the Tesla brand! Luxury vehicle sedan market Broader-based consumer adoption! Commercial vehicle segment Mass vehicle production and gain reputation Environmentally friendly - zero emissions! Extremely functional - roomy interior, 17-inch touch screen vehicle interface and control center, battery with ranges from 160 to 300 miles, useful life up to 7 years! Attractive - much more cheaper than other luxury brands Phaze 1, dominated segment is middle to higher-end sports car market with Model S! Phaze 2, develop business in mass market with an affordable BEV Targeting Positioning Segmentation → → →
- 16. Product Mix & Product Line Model S Market Segment: middle to higher-end Price: ＄112,375 Model X Market Segment: high-end ! Price: ＄147,130 to ＄226,590 BEVs Energy Group Leasing - lithium-ion battery pack! ! - electric vehicle powertrain component! ! - supercharger User Experience
- 17. Product Performance - continuous torque within the 6000 rpm range ! - exceptional power beyond 13,500 rpms! - extremely fast at any level of rpm output High Torque Ratio - six times as efficient! - less than one-tenth the pollution! - mechanically much simpler (10 times fewer moving parts, no engine, no transmission, etc.) Efficiency - the friction brakes experience little wear! - only routine vehicle inspection, possible simple software updates and tire maintenance needed, for the first 100,000 miles. Reliability - accelerates from zero to 60 in 3.9 seconds, faster than any Ferrari or Aston Martin currently in production Powertrain 6000! 13,500 6! 1/10 100,000 60! 3.9
- 19. 4Ps - On the beginning phaze, establish strategic partnership with large automakers! - On the second phaze, setting up own supply chain in China Production - First step, focus on main metropolises! - Second step (long-term), after BEV market being relatively mature, seek for expanding to other main cities Place - Model S, middle to higher-end market! - Model X, luxury market! - Commercial vehicle, relatively mass provided to Beijing, Shanghai, Guangzhou and Shenzhen and generate UX Product - Resonable price to gain competitive price in high-end market! - With the expand of market and R&D of technology, provide an affordable price Price
- 20. Strategic Partnership PANASONIC strategic partnership DAIMLER nearly 10% stake (estimated $50 million) TOYOTA roughly 3% stoke of Tesla Supply Chain ! ! Manufacture Plants ! ! Delivery Line Long-term partnership in US market! High-awareness and reputation in China we could SHARE... they are...
- 21. Sales & Service Franchise Dealership - free snacks, coffee bars, high-speed internet, comfortable couches Highly visible & Premium outlets Stimulating & No-pressure environment Hands-on experience - test-drive with a salesperson
- 22. Competitor Analysis 01 Karma (2011) & Nina (2012)! - plug-in hybrid vehicles Sports Luxury Market Private Cars - Plug-in Hybrids! Taxis and Buses - Battery Electric Vehicles Low-end to Middle-end Market BYD Newton (2008)! - price: $85,000 Commercial Class EV Market eStar (2011)! - price: $150,000! - range: 150 miles Commercial Class EV Market 02 Fisker 04 Smith 03 Navistar
- 23. Communication Plan High-tech Attractive Reliable Environmentally Friendly Functional Bettery Driving! Green Living
- 24. Communication Plan Unified Voice consistent concise frequently Four Key Groups customers retail sales force industry analysts press
- 25. Standardised Advertising - target markets worldwide currently exist within homogeneous environments, customer wants and demands are mostly similar! - launch unified advertising campaign, with high quality, and cover multi-platforms! (Car and Driver, Motor Trend, TV Stations, Offcial Channels) High-end Forum - PLACＥ: metropoliese in China, holding forums every half a year or annually! - COMPANY: large automakers to participate and provide a platform for resources sharing! - TOPIC: new energy development, environmental friendly vehicle and debelopment of BEV market Advertising Strategy Bettery Driving! Green Living
- 26. Bettery Driving! Green Living Green Beijing Especially adopted in Beijing! - BEV taxis with "Green Beijing" in front and behind, the characters are composed by plants ! - interactive outdoors device in downtown, customers drive model BEV, the LED with mist sky turn blue Absolute Zero Adopted in all metropolises! - what will happen after zero (emission) achieved?! - a vending machine with many cards in, some are coupons while others are pictures of nature with Tesla LOGO! - customers need to write down 'absolute zero' on screen and give 0.1 Yuan (for environmental conservation) to get the card PR Strategy Sponsorship with NGOs partnerships with leading green, clean energy non-profits Green Scholarship provide in famous universities in China! especially for new energy development projects or students
- 27. Cost & Benefits Analysis PART 05
- 28. Cost and Benefits - Car and Driver! - Motor Trend! - TV Stations in Metropolises! (Beijing, Shanghai, Guangzhou, Shenzhen) Advertising - Green technology, Beijing! - BEV Prospect in China, Guangzhou Forum Interactive outdoors devices: ! - Xidan! - Wangfujing ! - CBD of Guomao Green Beijing Vending machines:! - Lujiazui CBD, Shanghai! - Zhujiang New Town, Guangzhou! - Futian CBD, Shenzhen Absolute Zero 1 2 3 4
- 29. Bettery Driving! Green Living Cost and Benefits Media Schedule Period 1 Period 2 Period 3 2016 1 2 3 4 5 6 7 8 9 10 11 12 Internet Journal TVC Forum Outdoor
- 30. Cost and Benefits Project Detail Cost Magazine Design! $600*6 times! Release! Car and Driver_612,000 circulation ! 1.61 million TVC Design & Producing! $1,000,000*3 times! Release! (GMT8) 22:25 Mon-Fri, 22:55 Sat-Sun! 3.21! million Forum Outsourcing to PR agency, $15,000*2 30,000 Outdoor Interactive Devices $1500*4 6000 Bettery Driving! Green Living Budget Sheet
- 31. 单击添加您的标题 - generate initial demand ! - establish loyalty Consumer Value - with consumer base gained ! - to attarct mass potential consumers Mass Market - dominate luxury BEV market! - set up high-tech brand image High-end Market - gain awareness and reputation among public! Brand Asset Cost and Benefits Luxury Vehicle ! Market Segment Broader Mass-market ! Consumer Segment
- 32. Reference List:! 1. Joan Schneider, & Julie Hall. (2011). Why Most Product Launches Fail. Retrieved from https://hbr.org/2011/04/why-most- product-launches-fail/ar/1! 2. Spencer Michels. (2008). As Oil Prices Rise, Carmakers Look to Electric Future. Retrieved from http://www.pbs.org/ newshour/bb/transportation-jan-june08-electriccars_06-25/! 3. Author, Goldman Sachs, Morgan Stanley, J.P. Morgan., & Author, Deutsche Bank Securities. (2010). Form S-1 Registration Statement Under the Securities Act of 1933. Retrieved from http://www.sec.gov/Archives/edgar/data/ 1318605/000119312510017054/ds1.htm#toc51863_11! 4. Buyers loath to pay more for electric cars. (2010). The Financial Times! 5. Author, Claire Cain Miller. (2010). Tesla Electric Cars: Revved Up, but Far to Go. The New York Times. Retrieved from http://www.nytimes.com/2010/07/25/business/25elon.html?_r=1&adxnnl=1&adxnnlx=1281139208-CSLYpDV6HTnlBaA/ DbnqUg! 6. Share in Tesla Electrifies the Teutons. Wired (online). Retrieved from http://www.wired.com/autopia/2009/05/daimler_tesla! 7. Tesla to release a Model S with 300-mile range. (2011). The Oakland Tribune! 8. Tesla Motors CEO: “We can succeed as an indecent company”, Bloomberg says. (2011). Theflyonthewall.com! 9. 2nd update: Tesla shares rise after Obama backs clean fuel cars. (2011). Dow Jones News Service! (haven't mentioned on former slices) Reference List