Should Tesla Start Advertising?

Tesla has done most of its sales to-date by word of mouth. This is in large part because Tesla has a superior product in range, performance, and entertainment (especially in the Model S Plaid). There was a Twitter thread recently where advertising was brought up to Elon Musk again.

Maybe we should advertise informationally just so people know stuff like this exists— Elon Musk, the 2nd (@elonmusk) June 16, 2021

How does Tesla advertise now?

Tesla does have quite a bit of advertising right now. It may surprise you when I say what this advertising is. The advertising is from Elon Musk himself.

Elon Musk has over 57 million Twitter followers. Many of those followers will like, share, and retweet what Elon Musk is saying. This has a huge network effect and reaches many people. The question remains, however, is there a better way Tesla could advertise besides its CEO saying how cool the cars are or that the Model S Plaid is alien technology?

How could Tesla advertise in the future?

Tesla could advertise on traditional television media, such as cable television or commercials for sporting events like the Super Bowl, NBA finals, World Series, etc. This is what other automakers are doing. Will Tesla do this?

I don't think Tesla will go the traditional media route for advertising. I think Elon Musk thinks that going that route will taint the Tesla brand and lump it in with all the auto makers. Elon would rather excitement and buzz come as a grassroots movement, like when the Model 3 was released. The excitement and buzz created by people alone creates a halo effect and mystery, which people love.

Tesla could also try advertising on YouTube videos or Google adwords or any of the other Internet mediums for advertising. This is a better option than television as over time, television is going to lose more and more market share and users. I'm not sure what Tesla should advertise on the Internet, but a good start would seem to be debunking FUD and pointing out relatively unknown and cool features of its vehicles and solar.

There are many ways Tesla can advertise, but should it?

Should Tesla advertise now?

Tesla seems to have lowered its interest payments for its PowerWall and solar setup. You can see the 0.99% APR rate at Tesla's energy website. Why not advertise that a little more?

I think Tesla should advertise things like this now and use the Internet as a medium for it. Why not say that Tesla has a low rate of 0.99% APR for its PowerWall and solar panels and push this through the Internet? I think Tesla energy should definitely advertise right now in order to gain market share and users.

Why not also advertise its technology and simply explain its advantage? Tesla can easily advertise its technology advantage over Ford, but instead, the internet is left to combat statements like "Ford has a battery advantage over Tesla".

Tesla should NOT advertise its auto business right now. Not until all its other factories (like Giga Berlin and Giga Shanghai) are up and running AND at full capacity with batteries. At the point Tesla has reached a large scale and competition is also producing millions of vehicles, then I think advertising makes more sense.

But right now, Tesla is supply constrained. It doesn't need to advertise anything while it's capped. But at the time that the cap goes away and Tesla isn't selling everything immediately and doesn't have months of backlog to sell, then it makes sense to market Tesla auto through advertising. But not now, that would just frustrate more people with longer wait times.

Final thoughts

Should Tesla start advertising more? Does this make sense to do even while Tesla is supply constrained? What are some ways Tesla could advertise?

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Jeremy Johnson is a Tesla investor and supporter. He first invested in Tesla in 2017 after years of following Elon Musk and admiring his work ethic and intelligence. Since then, he's become a Tesla bull, covering anything about Tesla he can find, while also dabbling in other electric vehicle companies. Jeremy covers Tesla developments at Torque News. You can follow him on Twitter, Facebook, LinkedIn and Instagram to stay in touch and follow his Tesla news coverage on Torque News.