Is Online Marketing Enough for Tesla’s Needs in 2023?

In an SEC filing dated January 2, 2023, Tesla revealed that it produced more than 439,000 vehicles and delivered more than 405,000 vehicles in the fourth quarter. In 2022, vehicle sales will increase by 40% to 1.31 million units, and production will increase by 47% to 1.37 million units. The company has acknowledged that it continues to move toward a more even regional mix of vehicle manufacturing, a goal that led to an even higher number of vehicles in transit at the end of the quarter. . Nevertheless, the company fell short of its ambitious goal of achieving 50% year-over-year growth, and he needed 1.4 million deliveries to reach that threshold.

Tesla continues to find ways to overcome transportation and logistics challenges and make better use of its online marketing approach. But the company’s innovative and unique online marketing approach among its competitors could be undermined in 2023 as changing economic forces inject uncertainty into the automotive world.

Tesla’s Online Marketing Approach: Still Unusual Among Its Rivals

Tesla is world-famous for its $0 advertising approach. Before the post-Covid economic downturn of 2022, Tesla was unafraid of its rival’s newfound success. Instead, it focused on dominating the all-electric vehicle sector while meeting its long-term goals. To that end, the company has avoided reliance on paid advertising altogether and instead relied exclusively on his online marketing. This approach has worked very well for the company over the past decade.

Tesla has meticulously promoted its mission and vision on its website to transition the world to sustainable transportation and sustainable energy while maintaining a consistent message of product excellence. Over the years, Tesla’s online marketing strategy has focused on improving the customer experience wherever possible through mechanisms that personalize the Tesla brand. However, the popular online referral program was discontinued in the United States in 2021.

Unlike most other auto companies, Tesla has embraced the social media influence of its fickle CEO Elon Musk, inevitably turning to his bonafide and often controversial persona as a means of staying in the news headlines. We are hiring.

Chinese Challenger Pushes Tesla: Adapting Online Marketing

Tesla will change its online marketing approach in China in late 2022. This was the result of unexpectedly fierce domestic competition. This forced different demands and threatened Tesla’s plans for growth in the world’s largest EV market.

• Tesla’s online marketing Weibo account posted an insurance subsidy of up to $1,100 for new buyers.
• The company has revived its user referral program. Participating owners will receive small gifts such as wireless headphones and strollers. There will also be a visit to the Shanghai factory and the chance to use a Tesla car for free for his year.
• Potential customers were invited to nominate cities where Tesla would bring the car to potential buyers for test drives. Some entries can use Model 3 for her week.
• Breaking through the well-known aversion to traditional advertising, Tesla ran ads on local TV shopping channels.

This online marketing effort came in part in response to previous local media criticism that Tesla was “arrogant” towards Chinese customers.

As reported by bloomberg hyperdriveSuch an online marketing decision comes at the same time that Tesla decided to cut prices across its Chinese catalog in October 2022 for the first time in 15 months. Pressures such as his ongoing Covid restrictions have sent Tesla’s stock price down, dropping to a two-year low and suffering a loss. Almost half of its value in less than two months. The shift came after the company upgraded its Shanghai factory, doubling its production capacity to about 1 million units per year.

Other issues, such as a slowdown in China’s property market and Europe’s energy crisis, also seem to have impacted the cumulative figures for all electric vehicle companies.

Other domestic automakers have increased consumer appeal by offering features such as built-in karaoke systems, fragrance dispensers, deluxe customer service, and a range of low-cost vehicles. Domestic Chinese car companies accounted for nearly 80% of EV sales through his first seven months of 2022, according to the report. Reuters.

South Korea fines Tesla for ‘exaggerated and deceptive’ online marketing

Tesla has been fined $2.2 million by South Korean antitrust regulators. Accusation? Cold weather reduces the range of the company’s EVs to about half what’s advertised online.

In 2021, a South Korean consumer group said the range of most EVs will drop by up to 40% in cold temperatures where the batteries need to be heated. “This is due to false, exaggerated and deceptive advertisements about driving ranges, supercharger performance and reduced fuel costs for electric vehicles,” said Nam Dong-il, a spokesman for the Korea Fair Trade Commission (KFRC). explained. In cumulative data shared by the country’s environment ministry, Tesla’s car was the worst among rival EVs.

Tesla’s website makes no mention of range loss in sub-zero temperatures. It offers tips for driving in cold weather, including preconditioning your vehicle with an external power source and using the app to monitor your energy consumption.

bloomberg Tesla notes that it changed an advertisement on its Korean-language website in February when the KFTC launched an investigation.

In addition, Tesla will be fined 1 million won for violating the e-commerce law for failing to provide consumers with sufficient information about its cancellation policy.

According to the Ministry of Transportation, Tesla had sold 45,812 electric vehicles in South Korea by the end of September since opening a local office there in 2015. Tesla is his third best-selling EV brand in the country, with a domestic market share of 13%. The two leading automakers are his two, domestic manufacturers Hyundai and Kia.

Tensions between the South Korean government and Tesla have arisen over the potential construction of a new Tesla gigafactory in the country. South Korea is known for its advances in battery technology, with LG Energy Solution being one of the world’s largest and leading EV battery companies, SK Innovation being another, and Samsung SDI being his third. .

Tesla Korea did not immediately respond to media requests for comment.

Final thoughts on Tesla and online advertising

Tesla’s stock will plummet 65% in 2022, its worst annual decline to date. Stocks plunged 37% in December, hitting their lowest level since September 2022. The EV giants bounced back from mid-week bear market lows to end the week broadly flat. Tesla’s stock fell more than 12% today on Tuesday.

After the market closes on Wednesday, January 25, 2023, Tesla will issue a brief advisory with online links to updates for the fourth quarter and full year 2022. This link will be available on Tesla’s IR website. Tesla executives will host a live Q&A webcast later today at 4:30 pm Central Time (5:30 pm Eastern Time) to discuss the company’s financials, performance and outlook.

In 2023, Tesla will benefit from a new US tax credit of up to $7,500. If the tumultuous pattern of Tesla’s stock valuation continues in his 2023, and Tesla fails to meet (even slightly) its sales guidance, a new approach to gaining brand awareness and approval may be required. I have. Questions may be raised as to whether the company’s online marketing approach, when combined with other mitigating factors, is actually sufficient to achieve the company’s far-reaching goals.

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