{"id":74932,"date":"2020-07-20T08:46:43","date_gmt":"2020-07-20T08:46:43","guid":{"rendered":"https:\/\/essays.homeworkacetutors.com\/sustainable-marketing-approaches-by-tesla\/"},"modified":"2020-07-20T08:46:43","modified_gmt":"2020-07-20T08:46:43","slug":"sustainable-marketing-approaches-by-tesla","status":"publish","type":"post","link":"https:\/\/www.colapapers.com\/us\/sustainable-marketing-approaches-by-tesla\/","title":{"rendered":"Sustainable Marketing Approaches by Tesla"},"content":{"rendered":"
\n

About Tesla<\/h2>\n

Tesla Motor, head office located at Palo
\nAlto, in the Silicon Valley, was founded in 2003 by Martin Eberhard and Marc
\nTarpenning to solve a real problem i.e. dependence on oil. The company led the
\nfirst round of investments in 2004 where 3 investors joined in namely Ian
\nWright, JB Straubel and Elon Musk (who is the CEO and principal investor in the
\ncompany).<\/p>\n

The company was named in honor of Nikola
\nTesla, the Serbian inventor and engineer who developed the first alternating
\ncurrent (AC) motor. It is the main anchor of the electric car industry and not
\nonly builds all electric vehicles but also focuses on infinitely scalable and
\nclean energy generation and storage products.<\/p>\n

The company has its manufacturing and
\nassembling operations at facility located at Fermont, California; Lathrop,
\nCalifornia; and Tilburg, Netherlands. The company has also built a cell and
\nbattery manufacturing facility, Gigafactory 1, outside of Reno, Nevada. As per
\nthe present plans of the company it continues to expand its product line along
\nwith production plan at a rate of 500,000 vehicles a year by 2018.<\/p>\n

Marketing<\/h2>\n

Local marketing strategies of Tesla<\/h3>\n

As one of its strategies to attract
\ncustomers in the foreign market, Tesla customizes its cars to meet local needs
\nand to satisfy the tastes and preferences of its customers. For example, in
\nresponse to customer feedback, Tesla made some modifications to its Tesla Model
\nS in China, including an \u2018executive rear seat\u2019 option, which costs $2000 over
\nthe standard model and aims to make the rear seat experience more comfortable (O\u2019Hara 2015).<\/p>\n

Excerpts from Tesla 10K:<\/p>\n

\n

\u201cHistorically, we have been able to generate significant media coverage of our company and our vehicles, and we believe we will continue to do so. To date, for vehicle sales, media coverage and word of mouth have been the primary drivers of our sales leads and have helped us achieve sales without traditional advertising and at relatively low marketing costs.\u201d<\/em><\/p>\n<\/blockquote>\n

International marketing strategies of
\nTesla:<\/h3>\n

Direct Selling:<\/strong><\/p>\n

Tesla sells its cars directly to its consumers through an international network of company-owned stores & galleries. This benefits the company to better control costs of inventory, manage warranty servicing and pricing, maintain and strengthen the Tesla brand<\/a> through obtaining customer feedback.<\/p>\n

Used cars sales program:<\/strong><\/p>\n

The company used car business supports
\nnew car sales by integrating the sale of a new Tesla vehicle with a customer\u2019s
\ntrade-in needs for their existing Tesla and non-Tesla vehicles. These acquired
\nvehicles are remarketed primarily to general public and also in auction.<\/p>\n

Strategic positioning of stores & galleries:<\/strong><\/p>\n

Another strategy employed by Tesla in
\nthe foreign market is deliberately positioning its stores and galleries in high
\nfoot traffic, high visibility retail venues, like malls and shopping streets
\nthat people regularly visit in a relatively open-minded buying mood (Musk
\n2012). This approach is to, as Musk (2012) states, \u201creach people before they
\nmake a decision on a new car.\u201d <\/p>\n

Super Charging stations:<\/strong><\/p>\n

The company has built their super
\ncharging network throughout North America, Europe, Asia and other markets to
\nenable convenient & long distance travel. The supercharger network is a
\nstrategic corporate initiative designed to provide fast charging to enable
\nlong-distance travel and remove a barrier to the broader adoption of electric
\nvehicles caused by the perception of limited vehicle range. The Tesla
\nSupercharger is an industrial grade, high speed charger designed to recharge a
\nTesla vehicle significantly more quickly than other charging options. To
\nsatisfy growing demand, Supercharger stations typically have between six and
\ntwenty Superchargers and are strategically placed along well-travelled routes
\nto allow Tesla vehicle owners the ability to enjoy long distance travel with
\nconvenient, minimal stops. Additionally, they are also building Superchargers
\nin an increasing number of city centers to enable urban use. Use of the
\nSupercharger network is either free or requires a small fee. <\/p>\n

Principles of sustainable marketing:<\/h2>\n

Sustainable marketing also referred to
\nas green marketing is socially and environmentally responsible marketing that
\nmeets the present needs of consumers and business while also preserving or
\nenhancing the ability of future generations to meet their needs.<\/p>\n

There are five sustainable marketing
\nprinciples:<\/p>\n

Consumer oriented marketing:<\/strong> a
\nprinciple of sustainable marketing that holds a company should view &
\norganize its marketing activities from the consumer\u2019s point of view.<\/p>\n

The marketing process strikingly points out the importance to orient one\u2019s business to the customer needs and to create appropriate values. Thus, satisfaction of customers needs by meeting their expectations on performance and quality fortifies a profitable long-term relationship to the customer. <\/p>\n

Below figure represents the profit chain
\nof customer orientation: \u2013<\/p>\n

\"\"<\/figure>\n

A lot of research focuses on the validation of customer orientation, the links between the relative concepts (i.a. Anderson, Fornell and Lehmann 1994; Appiah-Adu and Singh 1998; Brady and Cronin 2001a; Brockman, Jones and Becherer 2012) and the drivers of customer orientation (i.a.
\nStrong and Harris 2004). Johnson (1997) translates the underlying core concepts
\nof marketing into three sequential goals of customer orientation. <\/p>\n

First, one needs to acquire information
\non the customer needs and establish the extent to which they are currently
\nserved. <\/p>\n

Next, these gathered insights must be
\nspread throughout the organization and transformed into actions, which are subsequently
\nimplemented in a third step in order to satisfy the customer\u2019s needs. <\/p>\n

In sum, understanding customers\u2019 needs
\nis the first and essential step to long-term economic success.<\/em><\/strong><\/p>\n

Customer value marketing:<\/strong> a principle of sustainable
\nmarketing that holds a company should put most of its resources into consumer
\nvalue building marketing investments.<\/p>\n

\"\"<\/figure>\n

The customer value refers to current
\nvalue of complete profit obtained from these customers through the maintainable
\nbusiness relation of these customers. The study of this theory is completed as
\nenterprises continually seek competitive advantage and the related theory
\nformed and developed on the basis of reference summary. Since 1990s, the
\ncustomer value (Customer Value, CV) has become the focal point which the
\nwestern marketing scholars and entrepreneurs pay attention to together, and is
\nregarded as the new origin of competitive advantages.<\/p>\n

As the economic globalization becomes
\nthe mainstream in nowadays, it is extremely important that the marketing
\nstrategies must be getting stronger when faced with the increasingly intense
\nmarket competition. In the process of marketing, customer is the source of
\nenterprises profits and the key to business success, especially in the era of
\nthe buyer\u2019s market, who owns customers, is equal to having profit. Customer
\nsegmentation enables organizations to design different marketing strategies for
\ndifferent customers, and applies its superior resources to high value
\ncustomers, mines customers\u2019 potential value, and increases customers\u2019
\nsatisfaction, realizes customers\u2019 loyalty. <\/p>\n

Innovative marketing:<\/strong> a principle of sustainable
\nmarketing that requires a company to seek real product & marketing
\nimprovements.<\/p>\n

Market competition accelerates
\ntechnological progress and innovation in all areas to meet customer needs. It
\nalso includes product innovations aimed at increasing customer interest through
\ninnovative marketing tools. From a microeconomic perspective the customer
\nsatisfaction can be understood as a factor of product competitiveness valuation
\nthat can satisfy customer needs. <\/p>\n

Economists became interested in the
\nissue of customer satisfaction in the 1980s, under the influence of the economy
\ninternationalization, globalization and innovations generation. The
\npossibilities to enhance the company competitiveness through the satisfaction
\nof customers\u2019 requirements began to be explored. Customer satisfaction with the
\nproduct is neither objective nor absolute value. It is important to look for
\nnew opportunities and innovations to help the product to create customer needs
\nthat are considered as satisfactory by a customer<\/p>\n

Business environment constantly faces
\nnew challenges that require companies to react promptly as fast as they can.
\nInnovativeness is evident in all parts of marketing, as well as in marketing
\ncommunication. Companies constantly search for tools that seem to be more
\neffective in the relation with their customers. Appropriately chosen forms of
\nmarketing communication are effective in addressing more customers, getting
\ntheir attention, their confidence to buy a product and keeping the customers\u00b4
\nloyalty. <\/p>\n

Companies are using more or less
\ntraditional marketing communication tools that are also called \u201coutbound
\nmarketing\u201d and \u201cinbound marketing\u201d. New trends require companies to apply
\nmarketing communication tools which involve the customer in the communication
\nthat enables the instant feedback. Thus, the customer feels to be the
\ninseparable part of the sales process. This is also the way how to reduce the
\ncommunication costs and to achieve better communication and marketing
\nobjectives. <\/p>\n

Sense-of-mission marketing:<\/strong> a principle of sustainable
\nthat holds a company should define its mission in broad social terms rather
\nthan narrow product terms.<\/p>\n

This concept has led to a new generation
\nof activist entrepreneurs who are essentially trained business managers with a
\nsense of social responsibility and passion for a bigger cause.<\/p>\n

The most popular example of this would
\nbe of the Dove Campaign.\u00a0 After a research conducted by Unilever which
\nrevealed that only 2% of the 3300 women and girls surveyed across the world
\nfelt that they were beautiful, Unilever decided to redefine the concept of
\nbeauty.<\/p>\n

The underlying mission of this campaign
\nwas to discover \u201cReal beauty\u201d and to help women be happy with the way they are.
\nThe advertisement contained confident and bold women of all types instead of
\nregular models to echo the message of \u201cnormal is the new beautiful\u201d.<\/p>\n

Societal marketing:<\/strong> a principle of sustainable
\nmarketing that holds a company should make marketing decisions by considering
\nconsumers wants, the company\u2019s requirements, consumers and society\u2019s long-term
\ninterests.<\/p>\n

\n

\u201cThe well-being of individuals and society can be achieved by the enhancement of positive consequences associated with production and consumption of a product, as well as the limitation and\/or reduction of negative consequences associated with production and consumption of a product. The reduction of negative consequences and enhancement of positive consequences should be complementary in the conceptualization of a societal orientation. To this respect, a societal orientation should be concerned with maximizing positive impact of and minimizing negative effects associated with the production and consumption of a product in order to increase the long-run well-being for consumers and society at large.\u201d<\/em><\/p>\n<\/blockquote>\n

Explanation of the case & synthesis
\nwith the theory:<\/p>\n

Consumer oriented marketing: Tesla has
\nconsumer-oriented marketing<\/p>\n

The company has a traditional marketing
\nchannel of direct selling and promotes primarily through media coverage &
\nword of mouth. These drivers have helped them reduce their marketing cost along
\nwith spreading a word of trust to boost their sales in the EV market segment.
\nThe company through its owned stores interacts directly with customers keeping
\nin view of their feedback and focuses on customer satisfaction.<\/p>\n

Tesla also maintains low inventory and
\nand offers customization in accordance with the customer\u2019s needs &
\npreferences via the internet.<\/p>\n

Customer value marketing: Tesla lacks
\ncustomer value marketing<\/p>\n

Although Tesla focuses on customer
\nsatisfaction but there is an unclear vision through which it operates. The
\ncompany is not driven by profitability but from a perspective to eradicate the
\nusage of fossil fuels. The dependency of customers to charge their vehicles for
\nlong route is still a question of scalability from Tesla\u2019s point of view. The
\ncompetition offers hybrid vehicles which is a good alternative to lower the
\nconsumption of fuel and eradicates the dependency on charging vehicles.<\/p>\n

Innovative Marketing: Tesla has
\ninnovative marketing<\/p>\n

Tesla is continuously inventing and innovating its own bar of standards and has been driven by the green technology. As the consumer needs and preferences are changing they are drawn towards these products, which has resulted in increase in sales volume and expansion opportunities<\/a>. Tesla however, is also focusing on on providing convenience to its customers along with infinite supply of better technology.<\/p>\n

Sense-of-mission marketing: Tesla has
\nsense-of-mission marketing<\/p>\n

Tesla has a broad mission which is to
\naccelerate the world transition to sustainable energy. Tesla is also making
\ncontinuous efforts to make products more accessible and affordable to more and
\nmore people, ultimately accelerating the advent of clean transport and clean
\nenergy production.<\/p>\n

Societal Marketing: Tesla has societal
\nmarketing approach<\/p>\n

The company through its products and
\nbusiness offerings keeps society\u2019s long term interest as its primary objective.
\nThe customer needs are changing and so is the evolving technology and it is of
\nprime importance to increase our dependency on alternate fuels and reduce
\ndependency on fossil fuels.<\/p>\n

References<\/h2>\n
    \n
  1. Ravald A, Gronroos C. The Value Concept and Relationship Marketing [J]. European Journal of Marketing, 1996 (30): 19-30. <\/li>\n
  2. Flint D.J, Woodruff, R.B. The Initiators of Changes in Customers\u2019 Desired Value: Results From A Theory Building Study [J]. Industrial Marketing Management, 2001 (30): 321-337. <\/li>\n
  3. GAO Jie. Customer Value Discovery and Strategy. Economic Forum, 2006, No. 17: 90-91 (in Chinese) <\/li>\n
  4. HAN Minghua. Based on Customer Value Segmentation Study of the Marketing Resources. Technology and Management, 2009 (1): 81-82 (in Chinese) <\/li>\n
  5. YI Zhengwei. Based on Customer Value-Oriented Customers Strategic Choice, Business Time, 2011 (18): 40-41 (in Chinese) <\/li>\n
  6. LIU Qiusheng. ZHANG, Customer Value-Based Corporate Marketing Strategy Research. Business Studies, 2010 (6): 75-78 (in Chinese) <\/li>\n
  7. HU Xiongbin, Based on Customer Value, Customer Segmentation and Retention Policy Research, Business Time, 2010 (26): 26-28 (in Chinese) <\/li>\n
  8. LI Jun, China\u2019s Modern Economic Situation Analysis of Marketing Strategies For SMES, Technological Development, 2011 (5): 160-161 (in Chinese) <\/li>\n
  9. BALTES G., LEIBING I. 2008. Guerilla marketing for information services? [online]. New Library World, 2008 [cit. 2017-10-10], 109(1\/2): 46\u201347. Available online: \u02c2http:\/\/www.emeraldinsight. com.ezproxy. bib.hh.se\/journals.htm\u02c3<\/li>\n
  10. https:\/\/www.johnson.cornell.edu\/Portals\/32\/Blog\/Tesla%20Team%203-4-16.pdf<\/a><\/li>\n
  11. https:\/\/kupdf.net\/download\/marketing-plan-for-tesla-company_59a05c69dc0d60b51f18496b_pdf<\/a><\/li>\n
  12. https:\/\/www.researchgate.net\/publication\/322750674_TESLA_International_Business_Strategies<\/a><\/li>\n
  13. Social Marketing: An Approach to Planned Social Change, Philip Kotler and Gerald Zaltman, Journal of Marketing, Vol. 35, No. 3 (Jul., 1971), pp. 3-12<\/li>\n
  14. https:\/\/www.tesla.com\/about<\/a><\/li>\n
  15. http:\/\/ir.teslamotors.com\/static-files\/0fbefe56-326c-412e-a33c-aa1b342e9469<\/a><\/li>\n
  16. https:\/\/www.studocu.com\/en\/document\/university-of-newcastle-australia\/principles-of-marketing\/summaries\/chapter-20-sustainable-marketing\/1181751\/view<\/a><\/li>\n
  17. http:\/\/mentalfloss.com\/article\/66675\/10-things-you-may-not-know-about-tesla-motors<\/a><\/li>\n<\/ol>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

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