The shift in Elon Musk’s stance on advertisements has caught the attention of veterans in the advertising sector. As per recent comments from several industry veterans, Tesla’s advertising strategies moving forward — especially at this stage in the EV transition — could hold significant potential for the automaker.
For years, Musk has been staunchly anti-advertisement, arguing that Tesla would rather spend the money it would allocate for ads on improving its products. While this strategy had worked in the past when Tesla was just a budding automaker, things are different now that the EV sector is becoming more populated and Tesla is already the largest player in the field.
Tesla has noted that there is no such thing as an “EV market.” There’s only the auto market. And with Tesla now producing over a million vehicles per year, the company needs to attract as many customers as possible, including those that are completely unaware of the advantages of electric cars. Tal Jacobson, incoming CEO at advertising technology company Perion Network, told Reuters that Tesla would probably adopt a unique approach for its advertising strategies.
“Tesla has not been like every other car company, and it’s not going to start now, so expect breakthrough creative that speaks to Tesla’s disruptive technology and personality. His ability to use the media to amplify his brand and his company’s brands is an art form,” Jacobson said.
In a comment following the 2023 Cyber Roundup, Musk shared with CNBC that he does not really have a fully formed strategy for Tesla’s advertisements just yet. However, he noted that the company’s ads have to be “informative about a product” and “aesthetically pleasing.” “It should have some artistic element to it. And it should be something that you don’t regret watching after it’s done,” Musk said.
Bob Gruters, chief revenue officer at streaming platform Loop Media, noted that Tesla would probably not spend excessively on a brand mosaic similar to what Apple did with its iconic 1984-inspired Macintosh commercial that aired during Super Bowl XVIII. “I don’t think Musk would spend elaborately on a brand mosaic like Apple did, but… a minimalistic yet futuristic approach is what I’d see him taking,” Gruters said.
Kimberly Whitler, a professor at the University of Virginia’s business school, also stated that while Musk is effectively the face of Tesla, the CEO’s polarizing persona might not be a good fit for an advertising campaign. “Is he an effective ambassador? My guess is that there is a less polarizing, more motivating and compelling way to communicate the brand’s benefits than using Musk as a spokesperson,” Whitler said.
Thomas Martin, senior portfolio manager at Globalt Investments, shared his optimism about Tesla’s new direction. “Obviously, they’re going to have to focus on what’s good for the environment and also that it is a car of the future as opposed to your father’s Oldsmobile,” Martin said.
Advertising intelligence firm Vivvix estimated that Tesla spent roughly $151,947 on advertising in the United States last year. Ford, on the other hand, spent $370 million, Toyota spent $1.1 billion, and General Motors (GM) spent about $1.35 billion on US ads. Globally, GM is estimated to have spent $4 billion on advertising and promotions last year. This was nearly twice as much as Ford, which is estimated to have spent $2.2 billion last year.
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