It might sound like investing 101, but what Tesla ends up looking like as a company is key to its value
Tesla aims to be big in Japan
The US EV pure play sees opportunity in the Land of the Rising Sun
“There are some geographies where our market share is remarkably low.” So says Elon Musk, CEO of Tesla, of national markets that his firm’s BEVs have yet to conquer.
And he is particularly aware of a lack of progress in Japan, a car market that has largely preferred hybrids over all-electric venhicles in its electrification journey thus far.
“We also need to make sure that we have superchargers in the right locations, that the service centres are there, and that the product works well in Japan,” Musk cautions.
“But Japan is the third largest car market in the world of any country, and we should at least have a market share proportionate to, say, other non-Japanese car makers like Mercedes or BMW, which we do not currently have.”
Musk acknowledges that his firm’s brand that has become so resonant in North America and Europe has work to do to reach similar levels of familiarity in the East Asian nation. “When I talk to friends of mine in Japan, there is quite a lack of awareness of Tesla,” he admits.
And it is not an issue that is unique to Japan. “We definitely need to increase awareness in countries and regions where there is not that much awareness,” Musk says.
Raising the profile
Tesla has always been famously adverse to advertising, but it is now taking baby steps to do more marketing. The firm says it “ran a series of very targeted digital campaigns across different geos and different channels” in the fourth quarter.
But it stresses the largely experimental nature of its efforts thus far, as it wants to “ultimately measure the return of investment on those digital channels”. It cites the example of particular awareness campaign it ran in Texas that reached c.10mn unique viewers and generated close to 0.5mn visits to Tesla’s website, many of them first-time visitors.
“Going forward, we are just going to keep exploring different channels and doing our trials to get a better understanding of the effectiveness of these digital campaigns,” the firm says.
And new CFO Vaibhav Taneja is keen to stress that the budget for these new marketing efforts will be kept firmly in check. “I would also like to caution that we will be very careful that we do not want to overspend on this side,” he says.
“We want to make sure people are aware. But that is where we will keep tweaking our methodology about how and where we spend the money. Because we understand the importance of increasing awareness, but, by the same token, we do not want to spend a lot of money on just creating awareness,” Taneja warns.