Strategic Marketing & Value for the Customer

Lynda Thomas

University of Maryland Global

Running head: STRATEGIC MARKETING

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STRATEGIC MARKETING

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MRKT/310

Strategic Marketing & Value for the Customer

Introduction

In 2003, Tesla, Inc., formerly known as Tesla Motors, established an all-electric car manufacturer founded, and originated in the United States by Martin Eberhard and Marc Tarpenning the company was named after the famous inventor Nikola Tesla (Jung, 2020). Elon Musk, who now is the face of Tesla, joined the company in 2004 as chairman of the board after making a $30 million investment into the company (Jung, 2020). The founding idea of the company was to produce the first all- electric sports car, but today the company’s mission is to accelerate the world’s transition to sustainable energy (Jung, 2020). This paper will discuss Customer Value & Role in Mission and Company analysis in two parts. This paper will also answer questions concerning: Creating Value for Customers, The Role of the Customer in Company Mission, SWOT analysis and Competitive Analysis.

Customer Value & Role in Mission

Tesla’s customer value and role in their mission is somewhat different from the traditional auto manufacturer. Traditional auto dealers have distribution networks such as car dealerships that focus on moving a product. Tesla has showrooms and websites which function to communicate and create value for their customers (Hoffman, 2012).

Creating Value for Customers

Value can have a vast number of meanings. For some people, value could reflect on the price of an object, for example: What is the value of this car? Value could relate to the benefit of an object, such as the value I got from this car. Value could also relate to something of worth, hence the value for money. All these concepts are important to customer. The value and meaning of a product could determine what a customer’s willing to pay for what they consider as benefits, or a better product, or just more convenience (Mahajan, 2020). Value is created by mindset and culture. Mindset and culture are very difficult to change and imitate (Mahajan, 2020). Creating customer value enhances loyalty, market share, price, reduces errors and increases efficiency. Creating customer value increases customer satisfaction and the customer experience. A good customer experience will create value for a customer. To have long-term success, it is important to understand that mindset and culture are important and lasting (Mahajan, 2020).

The Role of the Customer in Company Mission

With most companies the mission statement is the declaration of an organization’s reason for being. The fundamental purpose that differentiates a business and thus defines it from other products or services and markets, is the role customers have on the mission of the customer and its philosophy (Alousque, 2019). Fossil fuels and petroleum are certain to expire from earth in the next 50 years. The response to the upcoming reliance of electric vehicles and cars will positively have one brand that is Tesla (GS & LS, 2020). A brand like Tesla will lead the race of electric vehicle cars in the future simply by understanding their target markets and appealing to the growing ecofriendly technological customer, which drives their mission (GS & LS, 2020).

Company Analysis

According to research conducted, in some cases, during the last 5 years, the development of Tesla was in an unstable fluctuation (Huang, 2019). A true fact is that Tesla has to face the risks and the challenges from its dangerous cost control and the increasing long-term debt and negative income growth. By using analysis tools such as SWOT and Competitive Analysis, this can help a company to deal with difficulties properly, and turn development and profit to a more hopeful direction (Huang, 2019).

TESLA SWOT Analysis

Strengths:

· Tesla is a leader in the electric vehicle industry.

· Tesla was the first companies to make a practical electric car to sell to consumers.

· Tesla car sales are directly to consumers, instead of selling cars through dealerships.

· Direct sales helps Tesla sell the cars at a lower price without dealer mark-up.

· Tesla is a leading competitor in self-driving car technology giving them a competitive advantage over other electric cars competitors (McCain, 2019).

Weaknesses:

· The company has a hefty debt load due to heavy capital expenses and years of losses, hindering future investments.

· All of its vehicles are produced in one facility in California, creating addition cost in sale for shipping and import taxes for consumers in Europe in China.

· Tesla sells all of their vehicles directly to consumers, they also have to ship all of the vehicles directly to consumers (McCain, 2019).

Opportunities:

· The electric car market is going to continue to grow.

· Consumers are becoming more environmentally conscious and technology improves to make the electric vehicles more affordable.

· Tesla is well established in the United States market and has a growing presence in both Europe and China (Eric, 2019).

Threats:

· Tesla’s electric vehicles have a high price tag because they are expensive to produce.

· Well established competitors begin to sell electric cars at a lower price points, causing Tesla to struggle to reach its much needed growth.

· When trying to grow in foreign markets consumers may prefer vehicles made by manufactures in their home country vices those made in America (McCain, 2019).

Competitive Analysis.

Total Electric Vehicle Sales by Automaker

(McCain, 2019)

The chart above illustrates all the major competitors that are trying to sell essentially identical products to the same type of consumers. The chart below illustrates four criteria selected as important factors to consumers when making decisions as to which of the three competitor’s offers are better. The products were scaled from 1= low to 5= high on each performs on each of the four criteria’s.

Tesla GM Nissan

Specific benefits: Charging time

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Price

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Range

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Storage Space

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Tesla ranked highest overall based on the sum of the columns. Each category Tesla was the leader and ranked highest for faster charging time, lower overall price and longer mileage range. However, compared to its competitors, Tesla had the least storage and trunk space.

Conclusion

Tesla’s mission shows the shift towards business approaches influenced by the consumers and market that are looking more futuristic. The fact that the company does more by manufacturing sources of green energy makes this company the future of humanity where clean energy is concerned. (Musk, 2013) Although there are still lots of problems affecting the financial health of the company have to be worked out, the corporation is showing its potential to develop to a giant in the future that cannot be ignored.

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Related Questions

Specific benefits: Charging time	5	4	3
Price	5	4	3
Range	5	4	3
Storage Space	3	4	5