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TESLA’S PRODUCT MIXAs an Independent automobile producer that provides a broad collection of products made from cutting edge technology, Tesla follows a business to business (B2B) model which promotes and builds a network with other companies. The B2B model allows the supply of products as well as services. Tesla is a well known distributor, manufacturer, developer and designer of eco-friendly products as well as offering eco-friendly related services to other automobile companies. Product development is strategically used to achieve its corporate goals in the product variable of the mix. As an international business, Tesla has many products, but the main product manufactured is the E.V. (Sedan) powered by a lithium-ion battery. Tesla is famous for its electric cars. Tesla launched its first car, The Roadster followed by the Tesla Model S with first class features like auto-pilot self driving, adaptive lighting, a strong engine and a “defence mode” to protect passengers in case there is an attack. The Tesla Model 3 was introduced as the third generation car. With customers very expectant, the company registered a record maximum number of bookings. Its one of Tesla’s great works with its maximum safety standards. A crossover SUV bodied in aluminium was unveiled as the Tesla Model X. It’s cutting edge Clean-air Tech offers passengers a level of protection from polluted air. It is also one of the quickest cars around, doing 0mph - 60mph in less than 3 seconds. It is also one of the safest. Nevertheless, in addition to the production of electric cars, the company produces parts for electric cars that other companies produce as this is a step in achieving the mission and vision of facilitating the movement of the world towards Electric vehicles and renewable energy. Also Tesla produces batteries that store energy for both domestic and industrial use. In line with this, SolarCity Corp, producers of solar panels and providers of installation services was bought out by Tesla so they could broaden their product mix. As much as much as Tesla’s main focus is on Electric cars, it also looks to develop and broaden its international business and product base. This particular product mix strategy supports the maximization of profit by the company.
TESLA’S PLACE/DISTRIBUTION MIXThe geographical location and infrastructural venues where the demands of customers are met is an integral part of marketing. All organizations supply their products and services at these locations. For Tesla, all organizational, strategic and developmental decisions are made at the headquarters in Palo Alto, United States. Alongside is a widespread sales and distribution complex. Tesla has distribution stores in Asia, Europe, Australia, South Korea, Dubai and North America. In May of 2018 Tesla had opened more than 5 outlets in the Canadian cities of Ontario, Quebec and Montreal. China is the largest market (both domestic and international) for Tesla’s electric vehicles, so much so that Tesla announced in 2018 that a production plant is to be constructed in Shanghai and is to produce 500,000 vehicles in a p of 5 years. In the 4th quarter of 2018 it was announced that partial production will begin in mid 2019 (FINANCIAL TIMES, 2018). Tesla is also the only foreign automobile company in China that did not have to enter a 50:50 agreement with the Chinese government in order to set up and start production. Tesla started operations in San Carlos California and later expanded its domestic reach buy opening distribution centres in LA and New York. Tesla had opened 260 distribution centres in only the United states by the end of 2016. Most of the stores are built in and around large shopping malls, giving the Tesla brand the ultimate maximum exposure. There is even a website where customers can go and pick a Tesla model of their choice to their specifications. Tesla’s sales approach is designed in a way that customers come in direct contact with the brand and all the experience it comes with such as repair and maintenance services. This is achieved through the service centres and stores. Also Tesla vehicle owners can charge their cars at the various charging stations provided by Tesla. In China alone Tesla says it has more than 3000 charging stations. All three of their largest fast charging stations are found in China. Most of the manufacturing is done at its facility in Fremont, California. Other plants are assembly plants. Examples are the Gigafactory 1 & 2 in Nevada and New York respectively. Instead of selling through dealerships Tesla advertises, promotes and sells its cars through online portals and company showrooms. It is worth noting that one if Tesla’s Research and Development division is located in Athens, Greece, an example of the p of Tesla. The place/distribution mix underlines noteworthy corporate management control in the manufacturing, distribution and sale of vehicles.
TESLA’S PRICE MIXPricing is an important factor of marketing strategies. It is what supports the brand. In the case of Tesla, price is what backs their premium brand as well as maximization of profits despite a limited production level. Pricing is what affects profits as well as what customers perceive the company to be. Tesla comes of with the following pricing strategies:
- Premium pricing strategy
- Market oriented pricing strategy
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