Why $0 Marketing Budget Has Generated So Much Buzz For Tesla? How To Advertise Without An Advertising Budget?
Source: Space.com
You might not have known that the world’s most valuable car company has a $0 marketing budget. For a while, Elon Musk has been saying that Tesla does not advertise or pay for endorsements. Because of advertising costs, consumers will pay more than its actual value for other cars. With Tesla, they use their money to make the product better.
What makes Tesla so popular? Here are some examples that might shed some light on how Tesla become a household brand name with a $0 marketing budget.
When it’s good to be hard to get
One of the things I always remembered from my class on economics is “supply and demand.” And this is what Tesla does best. With Tesla, the demand has outpaced the supply. Want to buy a Tesla? Get in line. Instead of having a waiting line, customers buying a Tesla have to go through the company’s website to configure their cars and filling out any paperwork for a loan.
With every new model, customers are willing to put down a deposit, get on the waiting list, and anxiously waiting for their cars. It’s good to be hard to get!
Launching a Tesla into space
Unless you own a rocket company, you will not be able to pull off the same publicity stunt: Elon Musk sent a $100K Tesla Roadster to space a year ago. It has now traveled farther than any other car in history. He outfitted his Roadster with cameras to capture views of the car as it floated through space, but the batteries are only expected to last for roughly 12 hours. Behind the wheel was “Starman,” clad in the same space suit that astronauts will wear during SpaceX’s Crew Dragon flights to the International Space Station. A nearly indestructible disk carrying a digital copy of Isaac Asimov’s science fiction book series, Foundation, is also on board, along with a plaque engraved with the names of SpaceX’s 6,000 employees. SpaceX accomplished a feat never before seen in space history
How smoking weed can make you famous
I’m not sure how many CEO of a public company will smoke a joint during a public interview. But then Elon Musk’s marijuana incident really got everyone’s attention. Shortly after his podcast with Joe Rogan aired, the media was all over Musk. Stockholders and board members were outraged. Tesla stock dropped. NASA launched an investigation into SpaceX. In an email to Tesla employees, he admitted to his employees that his behavior was “not wise.”
Is it worth it for all the troubles? Yes, because he is Elon Musk. It generated a lot of news about him and Tesla. And it proves that the company needs him more than he needs them!
Social Media is our best friend
One day after Reuters reports that Apple is once again getting serious about getting into the automotive industry, Elon Musk tweeted, “During the darkest days of the Model 3 program, I reached out to Tim Cook to discuss the possibility of Apple acquiring Tesla (for 1/10 of our current value). He refused to take the meeting.” However, neither Elon Musk nor Tesla has discussed the thought of selling the company in any financial filings.
His tweet probably generated more news than the news about Apple is serious about getting into the automotive industry. Better yet, it does not cost him or Tesla a dime. It’s all free. Elon Musk was able to leverage news about another company to increase the visibility of his own company and himself.
Is it really free marketing
Despite the claim that Tesla has a $0 marketing budget and $0 advertising budget, some of the things do cost money. For example, it costs money to send a Tesla into space, and creating YouTube videos costs money. Are they spending much less money on marketing than the traditional car manufacturers? I would think so and probably more effective marketing.
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