ThePublic Relations Practices of Tesla Motors
ThePublic Relations Practices of Tesla Motors
Mostscholars consider Tesla as one of the most promising and interestingbusiness enterprises, more so given the zest exhibited by its CEO,Elon Musk. As much as it is a young firm, it has employedtechnological advances coupled with innovation to provide numerouswilling consumers with zero emission automobiles (Sparks, 2016). Theautomobile industry is still heavily reliant on the internalcombustion engine, which of late has been considered as imposing arelatively huge carbon footprint leading to adverse climatic effects(Mangram, 2012). Many consumers, both the younger and oldergenerations are now calling championing for ethical consumerism, astep that the Tesla Company has proactively embraced. Hardman, Shiu,and Steinberger-Wilckens (2015) provide that the company like manyothers in this particular industry announced its very first recall in2013, which was in essence voluntary. This approach was considered asproactive in comparison to recall issues that have been plaguingother companies. This proactive and voluntary approach served tolimit incidences of litigation, injuries or other customercomplaints. However, the firm’s public relations wing has at timesbeen under fire for arguably offering a lackluster performance. Thediscussion seeks to delve into issues related to Tesla Motor’spublic relations practices, utilization of social media, and thecreation of a global brand.
Useof public relations to create brand and influence public opinion
EltonMusk’s progressive and bold utilization of social media has helpedTesla not only realize profitability but also create a global brandand influence the opinion of the public to align to the firm’sproducts. In fact, Musk has used his marketing strengths and skillsto take on big automakers such as GM and Toyota. Although Musk’smedia approach is largely unconventional creation of a steady flowof information and strategic tweets directed to the public hasworked. The CEO keeps the public updated on the progress of the firm,a move that has allowed him to electrify Tesla’s faithful. Thefirm’s primary strategic marketing plan has been continuously todevelop further demand for its battery electric vehicles or BEVs. Theplan has been to build continuously upon long-term awarenessinitiative as well as manage a positive corporate reputation andcreate customer loyalty to build proactively on the prevailingcustomer base through customer referrals. The firm has also plannedto encourage consumer input into its existing product developmentsystem. It is a well-appreciated fact that the Tesla brand targetsforward-thinking customers, especially from the upper-middle tohigh-class individuals though it is looking to create a niche withinthe middle-class segment of the global population. The brand’scharacteristics include attractive, high-tech, environmentallyfriendly and reliable products, which have in essence appealed topublic policy formulators all across the world.
Afirm such as Tesla could not be as pronounced as it is today withouta comprehensive marketing communications blueprint. Elon Muck, itsCEO, has projected a vision aimed at increasing more BEVs availableto majority consumers (Bessen, 2014 Mangram, 2012). As such, it hassince its inception presented a consistent and focused marketingcommunications approach as projected through all availablecommunications media. Guided by the company’s product positioningproclamation, the message is designed to be concise, consistent andoften communicated to inform sales prospects with Tesla’s BEVbenefits in comparison with gasoline fueled, hybrid or otherelectrical vehicles. More so, the company’s public relationspractices are aimed at encouraging prospective customers to visit itsoutlets towards gaining the firsthand trial of its arguablydisruptive products in the conventional automobile industry (Sparks,2016). It seeks to project this plan via an organized voice into fourprimary groups each with its distinct needs. The groups consider thein-house retail sales team, customers, press, and industry analystsas critical to the success of its public relations practicesstrategy.
Thefirm’s public relations strategy ideally revolves about threeobjectives (Mangram, 2012). The first of these objectives is toensure it introduces its existing and novel BEVs with optimum mediaimpact as well as consistently underline its dominance over the BEVvehicle industry. Secondly, its public relations strategy seeks tobuild on the significances of BEV technology by demonstratingavailability to a broad market base. Lastly, Tesla’s publicrelations objective is to support and elucidate its current andfuture product line strategies (Mangram, 2012). Instead of largelyusing the expensive forms of advertising such as television andmagazines, Musk largely uses social media such as Twitter to updatethe public on major announcements, a move that has greatly helpedshape the public opinion. Musk has also communicated about technicalissues and crises of Tesla vehicles, for example, the recall of 1228sedans, before the public was aware of the issues. The move presenteda game plan for the company to resolve the issue and engage thepublic on major issues. In this regards, the firm’s utilization ofsocial media has engaged the public and created a game plan throughwhich the firm communicates issues to the public thus, influencingtheir opinion greatly.
Applicationof new media avenues
TeslaMotors has already positioned itself as a pioneering organizationproducing commercially viable all-electric automobiles that meet notonly the federal compliance regulations but also boasts the bestmileage on a single charge (Rimmer, 2014). It has also successfullygenerated admirable media coverage concerning its vehicles as well asits perception as a forward-looking company. For instance, mediacelebrities such as Leonardo DeCaprio, Matt Damon, and George Clooneyhave aligned their personas with the Tesla brand. As such, socialmedia coverage and positive customer referrals to other potentialconsumers have been cited as the main drivers for the organization’simpressive sales leads. More so, this has allowed Tesla Motors tomaintain substantially low advertising and consistently ensureconsiderably small overall marketing costs (Rimmer, 2014). It isprojected that this particular approach will be a focus of theorganization’s public relations practices.
Onegood example as to how Tesla Motors has come to embrace the use of21st-centurymedia avenues such as social media sites has been attacking againstunfavorable automotive press reports. According to Hardman et al.(2015), the company challenged reports by BBC’s Top Gear and thereputable New York Times for unfittingly testing the Model S. Suchuse of the contemporary media avenues have served to generateawareness of its products further. The firm, especially through Musk,has strategically used the social media to posts about its much-hypedunveilings. For example, the March 2015 Tweet from Musk about a newTesla product to be unveiled increased the firm’s marketcapitalization by $900 million (Sparks, 2016). As such, the firmrecognizes the power and role of social media in creating a corporatebrand and boosting its image. In fact, to Musk and Tesla, the socialmedia is the modern PR channel that allows creating trust andengagement among clients, investors, media, and the stakeholders.
Crisisfaced by Tesla
Teslahas faced major crises in the past and handled them proactively suchas the Elton Musk management crisis and the bankruptcy crisis of2008. However, the company has used public relations and online toolsto First Fire when a video clip of a Model S car was publicizedengulfed in blazes after an accident. Before the fire, the firmboasted a 5-star rating in safety thus, the fire raised major issuesabout the safety of the Model S’ lithium batteries. After theincident, the firm’s stock dropped 6.24% and 4% in NASDAQ exchangecorrespondingly the following two days (Mail, 2013). However, insteadof avoiding the discussion or panicking, the firm used theconvenience of the social media to readdress the discussion. Thecompany used the potential crisis as an occasion to inform andeducate the stakeholders, as well as, explain that the vehicle enginedid not cause the accident. The firm reached out to the owner of theengulfed Tesla S in an email exchange and explained the technical andcauses of the accident, offered a loaner vehicle, offered to repairthe car, and extended a direct line of discussion. Musk then took tothe social media to explain to all stakeholders and customers whathad happened, as well as, gave a detailed explanation of the firm’sstandards and performance credibility (Bessen, 2014 Mail, 2013). Byexplaining the issues surrounding the incident to the public, Muskmanaged to illustrate the truth and stop incorrect rumors, increasemedia coverage, and increase the firm’s reputation, brand, andimage.
Comparisonwith a non-profit organization
5Wis a non-profit firm based in New York, whose main operatingobjectives revolves about offering public relations services to othernon-profit organizations to enable them to attain set objectives(5wpr.com, 2016). It is common to find that most non-profitorganizations tend to continue to operate in anonymity, an aspectthat has resulted in most firms failing to reach their coreobjectives. 5W deals with other organization in the not for profitindustry towards enabling them to reach out to the targeted audiences(5wpr.com, 2016). As much as it suffers significant financialconstraints in comparison to Tesla Motors, it considers publicrelations as critical in fulfilling its set goals. It boasts anenvironment, which fosters stronger and timely communication to itscustomers desired consumer base. It relies heavily on the appropriateconnection of other firms with their clients via numerous mediachannels (5wpr.com, 2016). It is also committed to employing diversemedia avenues including social media in a sensitive and equallytactful manner that is comparable to Tesla Motor’s PR practices.It, however, possess strategies and tactics that exploit not onlynovel social media avenues but also a highly experienced and matureteam of professionals.
Inconclusion, this firm’s public relations practices have beennotably successful resulting in a robust brand image, growingcustomer base as well as unrivaled customer loyalty in the automotiveindustry. The company has not only positively embraced the use ofnovel media avenues such as social media sites but also aligneditself with celebrities that appeal to its targeted market segment.This has served to minimize its overall operating expenditures aswell as maintain profitability and the production of new innovativeproducts.
5WPublic Relations Agency. (2016).Expertsin Non-Profit PR.Retrieved 20 May 2016 fromhttp://www.5wpr.com/practice/nonprofitprfirm.cfm
Bessen,J. (2014). History Backs Up Tesla’s Patent Sharing. HarvardBusiness Review Blog, 13.
Hardman,S., Shiu, E., & Steinberger-Wilckens, R. (2015). Changing thefate of Fuel Cell Vehicles: Can lessons be learnt from Tesla Motors?.International Journal of Hydrogen Energy, 40(4),1625-1638.
Mail,D. (2013). New blow for Tesla: Fire in the`world`s safest electriccar`began in vehicle`s battery. DailyMail, 3.
Mangram,M.E. (2012). The globalization of Tesla Motors: a strategic marketingplan analysis. Journalof Strategic Marketing vol. 20, no. 4.
Rimmer,M. (2014). Tesla Motors: intellectual property, open innovation, andthe carbon crisis. Retrieved 20 May 2016 fromhttps://www.law.berkeley.edu/files/Tesla_Motors_IP_Open_Innovation_and_the_Carbon_Crisis_-_Matthew_Rimmer.pdf
Sparks,D. (2016).TeslaMotors, Inc. Spokesman Exits — Is Public Relations in Elon`s"Critical Path"?Retrieved 20 May 2016 fromhttp://www.fool.com/investing/general/2016/03/17/tesla-motors-inc-spokesman-exits-is-public-relatio.aspx