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Why Tesla Has the Most Loyal Customers

Original Content Publication Date: 09/06/2014

Summary

Tesla has done an excellent job of creating brand loyalty among its customers. Unlike traditional automakers such as Ford and GM, Tesla doesn't have a massive advertising budget, nor does it conduct multinational marketing campaigns. Instead, Tesla relies on word-of-mouth marketing and mall showrooms for selling its cars. This works because of Tesla's tremendous brand loyalty.

Key Points

Important factors to create brand loyalty include:

  • Making an Enemy: Apple made an enemy of Microsoft. Tesla chose to be an enemy of big automakers and traditional auto dealerships.
  • Establishing an Emotional Connection: A study by marketing research firm CEB found that rather than being loyal to a company per se, people are loyal to what that company represents. Tesla represents saving the environment from fossil fuels.
  • Consumer Reports: Tesla communicates openly with its customers and listens to their concerns.

Discussion Questions

  1. What deliberate steps do you think Tesla took to create brand loyalty?
  2. Other automobile manufacturers also make electric or hybrid cars. Do they have the same emotional connection? Why or why not?
  3. What brands are you loyal to? Why do you think you are loyal to them?

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