Marketing Environment and Customer Analysis @Tesla Motors

Question: Discuss about the Marketing Mix for Tesla Motors. Answer: Introduction Tesla Motors, Inc is an American company, which makes automobiles and energy storage devices. The company also makes and sells electronic vehicles and battery products. A public company operates under the symbol of TSLA. The companys initial strategy was to attract the affluent buyers who could afford high-end expensive products. But as the product has reached a mature stage of the product lifecycle, the acceptance within the audience has increased, and the company is aiming towards more competitive market keeping their products at a lower price range (Mangaram 2012). Australia has a huge demand for automobiles where the natives are enthusiastic about automotive products. They are also becoming aware of the various environmental issues and consider a fully electric operated car in place for a one, which runs on petrol. Thus launching Tesla in Australia would generate huge profits for the company and fill the demand gap existent in the automobile industry of Australia. By conducting a market, customer and competitor analysis of the automobile industry in Australia, a plan can be outlined for a successful marketing and implementation strategy (Bag and Biswas 2013). Marketing Environment The Australian Automotive Market is a huge one and wide ranging which includes retailers, importers, and manufacturers, transport, servicing, and logistics. The manufacturers of vehicles strive to build technologies that enable the vehicles to communicate with the other vehicles and their surroundings. The Australian Automotive market is a flourishing one with the sales of new cars benefit the automobile wholesalers and car dealers and benefiting the service agents from the rising number of automobiles being registered each day and driving on the Australian roads and streets (Jain 2013). The annual earnings of the automotive market of Australia usually exceed to one hundred and sixty billion dollars and makes positive contributions to the Australian economy. The manufacturers of vehicles are well trained and have built a highly skilled workforce producing competitive products for the local and international markets. The local manufacturers of motor vehicles are suffering a loss due to the increasing prices of fuel since the last five years. This has resulted in a sluggish growth of the automotive industry at an annual rate of only 1.1 percent (Stein 2013). The rise in the price of fuels has also compelled the Australians to opt for fuel-efficient imported vehicles in place of petrol consuming indigenous cars. Customer Analysis Australia has a huge demand for automobiles with the sales of vehicles increasing each day. There are currently 15,142,000 automotive vehicles driving on Australian roads. A majority of the motorists (nearly 80%) consider the factor of fuel efficiency over the high performance of a vehicle. The price of fuel has constantly been rising making the Australians opt for fuel-efficient vehicles than petrol guzzling ones. It is important for the manufacturer of cars to understand the attitude of the customers so that they can customize their cars according to their preferences (Mangaram 2012). The recently evolved consciousness among the Australians towards environmental issues has also led them chose battery operated cars that run totally on electricity and do not need petrol to run. This will have less consequential impacts on the environment and will save them the fuss of refilling their cars with petrol now and then. Tesla has been making huge profits in America with the launch of its clean vehicles that runs on battery, which can be charged with the help of electricity (Raju 2015). With the attitude of the people changing positively towards the environment, the launch of Tesla vehicles can prove to be successful and profitable for the company. Competitor Analysis Teslas competitive rivals include the big name German car manufacturers like BMW, Porsche, Audi, and Mercedes-Benz in the battery generated cars category. Although Mercedez might be the last to join, the group but its strategies are the most ambitious. The company has been working relentlessly on a range of new electricity generated car models. Going by the reports, Mercedes will be spending more than three billion dollars to develop and design its new car models. Audi and BMW are also in the league investing huge capitals on the development of electricity-generated models that are viewed as direct competition to TESLA (Cherubini et al. 2015). Porsche is also trying its best to design models, which have high voltage battery storing technology and a couple of electric motors that are innovative in style and are aimed at giving the American Company, Tesla a tough competition. The company has recently announced that it plans to design a model version of its Mission E impression. But such level of competition does not seem to tense the company at all. Its owner, Elon Musk, is of the opinion that the concept of a battery-operated cars responsibility is to inspire the already established manufacturers (Huang and Sarigll 2012). Teslas primary goal is to promote the development of a sustainable transport system. Identification of issues, Positioning, and setting of Marketing objectives The Tesla cars are high priced targeting their products to mostly the affluent customers who can afford a high-end automotive vehicle. The technology needed to manufacture these cars is expensive which explains the reason behind them being priced at such a high range. This limits the customer base of Tesla, which cannot include the average income earning groups of the society. Since the concept of battery-generated automotive cars is relatively new in the area, the problem with their charging to run for long distances often arises. An industry analyst very recently pointed out that until the price of Tesla cars falls drastically and a network of car charging stations are installed in the country; Tesla will continue to be a vehicle that comes under the Niche category (Cherubini et al. 2015). The Tesla cars are positioned as a Battery operated vehicle-manufacturing company that aims to compete with vehicles that deliver high-level luxury experience to the customers (Hanssesns et al. 2014).The company wants to provide an opportunity to environmental conscious motorists, resulting in zero emissions as they drive along the roads of Australia. The marketing objectives of Tesla do not involve spending massive amounts on the advertising of its cars like the other competitors in the market. It believes in spending that kind of money in the research and development on its cars, and the customers will be automatically attracted to them. The retail strategy is also a component of the marketing objectives of TESLA. The marketability of the co-founder of Tesla, Elon Musk is also an innovative component of Tesla's unique marketing strategy (Fifield 2012). Formulation of Marketing Strategy and implementation Product: Teslas cars are built to perfection. They are battery operated electric cars, which have a splendid driving experience, and is built purposefully to be aerodynamic in nature. The Sedan offered by the company is very spacious, with a couple of seats behind the driving front. The speed of the cars can go up to 140 to 1560 mph, depending on the battery, which is used. The cars are very advanced with the interiors having an eighteen-inch touch screen display (Huang and Sarigll 2012). The cars offer a range of packages from which a customer can choose according to his or her preference. The company also allows its customers to customize their cars, giving them an opportunity to design their cars according to their personal use and purposes. Price: The pricing strategy of Tesla cars is wide-ranged. The customers can choose from a number of price options according to their preference and affordability. The choice of battery has a huge impact on the price range of the cars. The bottom line models with 50Wh batteries cost around $75,560 and the premium models with 70p battery costs around $94,459. The highest price of the cars can go up to $123,789 (Hanssesns et al. 2014). Place: Tesla sells their cars either through their own stores or online. There are numerous stores, which display their luxurious cars. The customers can chose and customize them according to their own preference. The cars are also sold online through the official website of Tesla Motors, Inc. The company does not involve dealers as an intermediary between the cars and its customers, therefore cutting out the intermediaries all together. Because of the companys unique attitude towards its marketing strategies, it is often compared to Apple (Irfan et al. 2014). The companys policy to sell its cars directly to the customers has often put the company into a lot of controversies. Still, Tesla has stuck to its retailing marketing strategy. Promotion: Tesla has a unique promotion strategy, which is very different from its competitors. It does not spend a magnificent amount of capital on the allocation of its advertising budget. This stands in huge contrast to the Nissan Motors, which spends twenty-five million dollars for advertising their fully battery driven vehicle Leaf, in the year 2012. However, the Companys C- founder Elon Musk has a different marketing strategy in mind. He believes that spending the advertising money in the development of the product is a much better alternative (Fifield 2012). He is of the opinion that if the products are high end and satisfactory, the customers will automatically be attracted towards them. The retail strategy is also a component of the marketing strategy of Tesla. They have unique showrooms located not on highways but inside shopping malls located very close to the showrooms of premium brands like Apple and Michael Kors. The last and the most prominent component of the marketing strategy of Tesla is the co-founder of the company himself- Elon Musk. He is constantly present at the forefront with his interactions over the social media, magazine coverage, and press releases (Grunig and Kuhn 2015). Such a kind of promotion has helped in the building of brand equity and has also lead to huge popularity among the masses. Presentation and research The data for this report has been collected through the secondary sources. To suggest the marketing strategies and plans for the Tesla Motors, Inc launching in Australia, the company background is analyzed along with the marketing objective and strategies that it follows while running the country of its origin, America. Conclusion It is quiet commendable that with no or little advertising, Tesla has gained huge popularity within the masses. Tesla is in its way to become a new leader in the Automotive industry. The fact that they produce an alternative version of battery-operated cars gives them an advantage. Tesla is not much affected by the rivalry strategies of its competitors. Elon Musk believes in providing a sustainable transport system to the community and is proud of the fact if it is inspiring other companies. Their marketing strategies are unique which are of social orientation, which sets them apart from its competitors. If the company follows these marketing strategies in Australia, it will increase the probability of its success in a completely new market area. References: Bag, S. and Biswas, D., 2013. FOUR P'S COMPASS MODEL IN NEW PARADIGM OF MARKETING MIX.International Journal of Applied Services Marketing Perspectives,2(1), p.273. Charles, T., 2013. Competitive Strategies and Government Policies: The Automobile Industry (Tesla Motors). Docs. school Publications. Cherubini, S., Iasevoli, G. and Michelini, L., 2015. 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