Tesla Marketing Strategy: How Tesla Advertising Works On A $0 Budget (2023)

Tesla is famous for its EV wares, with its Tesla Model 3 set to be the world's best-selling EV for two years, 2020 and 2021. This is impressive. But what is more impressive? The giant EV did it without any of its vehicles hurtling down a country road in a TV commercial.

The company has no advertising or marketing department. Still, it has sold 936,000 vehicles and generated $44 billion in revenue in 2021. How is this possible without paid advertising and marketing managers? It all boils down to Tesla's brilliant marketing strategy.

But how the hell could a multi-billion dollar company have a marketing strategy without a marketing team behind it?

First, it's safe to say that Tesla is unconventional. That goes for the entire organization, including its ever-tweeting CEO, Elon Musk. While Tesla's marketing strategy is authentic, it's not a secret hidden in a combo vault like KFC's recipe. It's something you're familiar with, it's just that the EV giant executes marketing tactics so well they've spent $0 on paid ads to sell cars in 2020.

What exactly is Tesla's marketing strategy and how does it work? Read on to find out and learn how to apply it to boost business growth.

Tesla Marketing Strategy: How Tesla Advertising Works On A $0 Budget (1)

Tesla's Customer-Centric Marketing Strategy: An Effective, Free Marketing Technique

Marketers call this user-centric, human-centric, or customer-centric marketing. Regardless of how they rename it, the idea remains the same. Customer-centric marketing means meeting the needs and expectations of a target audience. For this purpose, several well-known brands use advertising to pass their value to the people, as we see inAmazon ads.

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But not all companies, especially startups, can in a$16.9 billion announcementBudget. So how can entrepreneurs implement a customer-centric marketing strategy while minimizing the cost of advertising spend?

The key lies in Tesla's marketing strategy and its heavy investment in building a human-centric customer experience. This includes human-centric marketing, marketing aligned with company goals, and word-of-mouth advertising.

Human-Centered Marketing

Tesla's marketing strategy focuses on improving user experience. It's an unwritten mantra that EV companies follow. It begins in the research and design phase and flows throughout the buyer's journey. Let's consider the first tier, innovative designs.

Innovative projects

Tesla is completely focused on developing innovative products that offer incredible driving experiences. In 2021, the company invested more than $2.59 billion in research and development to achieve this goal. Efforts have resulted in large self-promotional benchmark projects in the electric vehicle market.

For example, Tesla's Sentry Mode uses external cameras to monitor the area and report potential threats to the owner. Autopilot is another futuristic feature. These unseen features are great, but what's scariest is the Tesla S's 17-inch touchscreen.

You can call it a Tesla tablet. It has everything you need for smooth driving, from maps to weather updates to a music player. Potential customers can also design and order a Tesla by customizing the interior and exterior of the car to their liking. These innovative features and customization options give Tesla a cult following that increases the company's sales through referrals.

An attractive referral program

Referral programs are a fantastic way to reward customers who bring new users to a brand. Tesla ran attractive referral campaigns in 2015. This attracted many referrals, who received incentives such as accessories, free car maintenance and software updates. A YouTube promoter took advantage of this opportunity, raising more than $12 million in referral sales and taking home two high-end convertibles.

Word spread and the program grew even bigger in 2019 when Tesla gave away 80 new convertibles to referrers. EV multinational had to cancel the program due to costs.

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Regardless, Tesla has introduced new rewards that are enticing enough to attract potential customers. For example, you can experience a SpaceX rocket launch or let your photo float in space.

Companies that emulate the idea behind Tesla's referral program indirectly turn customers into marketers. Potential buyers are more likely to interact with external human users than advertisers who serve ads across the web.

Custom service options

Car owners often encounter frustrating sticking points while driving. This is often the case with merchants, where salespeople can persuade customers to close a deal at their expense. Tesla knows this is bad business for its target audience and has developed a fully-functional online sales center to truly meet their needs.

Tesla's online sales center was built by George Blankenship, who is also the designer for Apple's retail store. The sales center makes buying a car easy, efficient and convenient. This eliminates resellers who are focused on earning a commission and less concerned with helping customers get their needs met.

In addition, potential buyers can test drive Tesla's electric vehicles, after which the company follows closely with the option to configure their future car online.

Easily accessible after-sales customer service

Accompanying the customer must go beyond seeing the bouncer goodbye after a sale is completed. Tesla knows this and has developed an impressive post-sales support service, even greeting customers at their door. But how could that be for an electric vehicle company?

Tesla Ranger, a team of Tesla-trained mobile technicians, offers repair services at your home, on the road, or anywhere convenient for you. In addition, an automatic self-diagnostic software program identifies problems and informs passengers about them. A remote Tesla technician can then relay instructions for a quick fix, or be physically present if the issue is complex enough.

This saves you the tremendous stress of taking a car to a mechanic. Also, Tesla has a well-structured network of charging stations to pump out power when your vehicle's battery is low.

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Drive marketing efforts through business objective.

People are increasingly aware of the need for products that not only motivate but also solve personal and even social challenges. Tesla's mission to accelerate the world's transition to sustainable energy resonates with many consumers.

The electric vehicle company keeps the public up to date with product, operational and work culture news through its sustainability report. Tesla continued on its mission and released its EV patent to the public. As a result, competitors were able to capitalize on his idea and join the sustainability revolution.

Of course, that doesn't mean you should post your company's patent on social media. But looking beyond the suppression of competitors is healthy for company and industry growth.

word of mouth marketing

In addition to buying the experience, customers also pay attention to brand stories. This is a subtle art of spreading a business message. Somehow Tesla managed to turn it into fascinating events with advertising stunts. And they have coverage of their story, making it viral in the open world.

A cross-promotion between Tesla and SpaceX, the Tesla Starman has taken marketing to new heights. A Starman in a roadster shot into space, hurtling away from life-bearing Earth into the vast void. An event that took the space world by storm and became popular for days.

Back on Earth, Tesla had other plans for marketing its cars. They asked members of the press to test drive the Model S and write reviews about it. What cost the clients (pun intended) was a $5,000 deposit that was available to the press at no cost.

Companies like FOX and MSN are spreading the word, making Tesla engines go viral on social media. Still, Tesla's Elon Musk is popular on social media for driving Twitter users' interaction with the company's electric vehicles. Respond to tweets and provide helpful tips to get even more out of a Tesla and receive effective feedback.

For example, a Tesla customer suggested that Tesla should automatically adjust its steering wheel to make exiting a park easier. Musk responded within 24 minutes, and the suggestion was turned into a new feature via a software update. Just about any Twitter user, from red carpet celebrities to unverified accounts, can talk to Elon Musk about Tesla and even matters outside of his line of business.

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Musk also appreciates that customers communicate with Tesla through him. CEOs who are actively serving as marketers and even customer service reps are rare in the business world, but the norm for Elon Musk on Twitter.

That got Tesla on Forbes, obviously not on their global billionaires list because they have Musk's Twitter account as their top $40 billion marketing channel.

Tesla Marketing Strategy: How Tesla Advertising Works On A $0 Budget (2)

Value? Does Tesla's marketing strategy really put it ahead of the competition?

High-performance electric vehicles are entering the automotive market and it's exciting to see how well they perform. In 2021, the global market share for electric vehicles was 9%, up from 2.5% two years earlier. Tesla Motors led this rapid growth with a 14% market share and more than 936,000 units sold.

Competitors have also put up impressive sales figures to become king of the EV market.
Here's an estimate of what they sold:

  • Toyota, 674,000 units
  • WORLD, 594,000 units
  • General Motors, 517,000 units
  • Volkswagen Group, 453,000 units

Comparing those numbers to Tesla's shows that the margin is pretty close. However, it becomes a very different career when you factor in ad spend. Tesla spends $0 on ads for its vehicles, while other EV giants snag a $6.5 million 30-second Super Bowl ad.

It's certainly supercharged advertising and not all companies can afford it, especially startups. So what are the key points of Tesla's marketing strategy that improves the customer experience while driving growth and revenue?

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A quick marketing lesson for growing businesses

Tesla's marketing strategy can serve as a unique blueprint for growing your business and minimizing marketing costs. It's not that ads are bad, don't convert, and can't run on a low budget, but startups need to understand customer pain points first.

It would help you offer solutions so customers know this solves their problems. Check out these power points you can gain from Tesla's marketing strategy.

  1. Startups can significantly reduce advertising costs by integrating a memorable customer experience, from research and development to product/service delivery.
    Additionally, growing businesses must also provide an after-sales experience that serves users exactly when they need it. It could be a well-designed service, such as B. a software upgrade that increases customer satisfaction. Post-sales service builds customer loyalty because people who really feel cared for are more likely to revisit your store.

  2. Build a community. Tesla's marketing strategy involves building a one-to-one relationship with customers, using Elon Musk's constant interaction on Twitter as a case study.
    People only look for communities with functional goals. After all, why join an online space if you can't brag about your accomplishments? That's why Tesla has such a large following of dedicated fans.
    Thanks to its unique mission of a sustainable environment through clean energy and the ability to deliver it. Therefore, you should have a well-formulated business objective and let it drive all facets of your business.

  3. Management can be an excellent contact for social commitment. Elon Musk is active on Twitter, answering questions and getting great feedback to improve Tesla products. Startup founders need to interact directly with customers and strengthen the relationship as their business grows.

  4. Have a strong marketing mix. Although Tesla focuses on people-centric marketing, it seamlessly integrates viral marketing. We can see this in Tesla Starman. Small businesses may not be able to take marketing to such heights. However, they can go viral through word of mouth. you should considerSEO-Marketing, another powerful tool that fits organically into customer-facing marketing.

  5. Building an iconic brand requires authenticity. This is why big brands and their products stand out, but to offer shop exclusivity to customers requires marketing. That's why we have a catalog of educational items like this one to boost your marketing. See related articles belowNetflix Marketing Strategyfor actionable insights.


How does Tesla spend $0 on advertising? ›

Instead of investing in ads, Tesla invests in innovation. This means instead of trying to chase after customers to buy the same old boring products, Tesla attracts customers by making products so cool even kids at school can't stop talking about them.

Is Tesla worldwide famous for its 0$ marketing strategy? ›

It specializes in creating high-quality electric cars for the general public around the globe and clean, renewable electric energy. They are known for their vehicle's incredible on-road performance. What may come to you as a shock is that Tesla is renowned worldwide for its $0 marketing approach.

What marketing strategies does Tesla use to be so successful? ›

Tesla's marketing strategies are based on online awareness, promotions, and, of course, the social engagement of the company's CEO. Tesla believes that it is better to invest in customers by offering them the best products rather than spend millions of dollars on marketing and promotions.

How has Tesla been able to achieve limited financial success with a very low marketing budget? ›

Tesla's marketing strategy, then, goes against the trend of developing TV advertisements and pushing its products onto consumers. Instead, Tesla focuses on word of mouth advertising, and referrals. Essentially, Tesla markets to its customers by not directly marketing to them.

What type of advertising does Tesla use? ›

Tesla relies on word-of-mouth advertising as its primary technique of spreading the word about its products. Customers spread the word about it to others who may be interested. Tesla offered the greatest customer experience it could afford, making its consumers pleased and excited about its product.

Does Tesla spend money on advertisement? ›

Incredibly, all of this has been achieved with zero spending on traditional advertising. As this chart based on research by Visual Capitalist shows, the reliance on word of mouth marketing (and CEO Elon Musk's Twitter account) allows a far larger budget for research and development.

What is the marketing budget of Tesla? ›

The marketing strategy of Tesla is very interesting as its marketing budget is $0.

What strategy is Tesla pursuing to promote and manage innovations? ›

For Tesla, strategic innovations doesn't mean developing new and unheard of technologies, but re-imagining how existing technologies can be deployed in new and meaningful ways. Tesla is engineering the future by looking to the past.

What is 0$ marketing strategy? ›

Zero dollar marketing is a marketing strategy that needs no or negligible money to market the products. Firstly, traditionally the means of marketing were TV channels, newspapers, holding, banners, etc. Which were cost-consuming and not very much holistic in approach to the audience.

What are the biggest obstacles that Tesla must overcome to successfully commercialize electric vehicles? ›

Supply chain issues, a global chip shortage, and a pernicious pandemic plagued the industry. However, an unorthodox strategy at Tesla proved invaluable when facing tough times in 2021 — vertical integration.

Why does Tesla do not advertise? ›

For years, Tesla CEO Elon Musk has famously said that he despises advertising. He said that Tesla doesn't pay or provide discounts for celebrities to drive its cars and that the automaker doesn't pay to advertise – though we have seen exceptions before.

How does Tesla get away with not having dealerships? ›

They choose to keep service centers, galleries, and stores. This new method of selling cars without the need of a dealer is supported by a few states as they consider the process beneficial to consumers because it removes the dealership markup and encourages better business practices.

How does Tesla use direct marketing? ›

Direct Sales

Unlike other car manufacturers who sell through franchised dealerships, Tesla sells directly to consumers. It has created an international network of company-owned showrooms and galleries, mostly in urban centers.


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5. Why Tesla's Short Term Stock Price Doesn't Matter, it's the Business that's Important
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