Back in 2014, a couple of recent college grads made an unofficial ad for Tesla.
It didn’t focus on the electric car company’s sleek design, or how its battery worked, nor did it try to make the car look cool driving down an epic roadway. Instead, it focused on how this vehicle went beyond transportation into imagination.
It saw Tesla through the eyes of a child, a lens of earnest wonderment.
The ad exploded online, quickly gaining the attention of car blogs and sites everywhere, until eventually the company CEO himself gave it a thumbs up.
Just discovered a great Tesla ad made by 2 recent college grads. I love it! http://t.co/20dPRD9yrJ
— Elon Musk (@elonmusk) March 14, 2014
Why wouldn’t he?
It perfectly embodied Tesla’s shoot-for-the-stars image.
More importantly, it was free.
Free, of course, in the sense it didn’t cost the company a dime, but even better, it was also free of typical corporate advertising conventions. There was no pitch, no ad agency boardroom, and no paid placement. The college grads made it because they loved Tesla, and people clicked because they wanted to watch it. It was a win-win for Tesla, and the kind of earned media every brand on earth craves, here served up in its purest form.
It also pretty much sums up Tesla’s advertising strategy—and budget—since it was founded in 2003.
Musk doesn’t buy eyeballs. He earns them.
Thanks in part to Musk, Tesla has grabbed up to 60% of the U.S. electric car market, stealing customers from other luxury brands along the way. The company sold more cars in 2019 than previous two years combined, and with its sales momentum, Tesla’s stock has risen almost 300% in the last year, giving the company a market capitalization that’s now more than double those of Ford, GM, and Chrysler combined.
Amid all this growth, Tesla’s paid advertising budget hasn’t changed. It’s still zero. Compare that to other auto companies, which spend tens of billions every year on global advertising. They spent more than $15 billion just on U.S. digital advertising in 2019.
Its brand voice and image rely solely on the quality of its cars, word-of-mouth hype of its customers, and of course, Musk’s social media megaphone. It may be the best marketing return on investment in history.
Yet there are limits to the founder-led brand approach.
For some, those limits have been glaring over the past few weeks, as Musk has been on a Trumpian run of controversial public statements. He threw a Twitter temper tantrum around whether and when he could reopen his California factory. He spewed COVID-19 misinformation during a Joe Rogan podcast. He decided that for sale by owner was the way to go in liquidating his multiple homes in Los Angeles’s posh Bel Air neighborhood. He seemed to imply that he had red-pilled himself and encouraged others to do so as well, to the delight of Ivanka Trump.
— Ivanka Trump (@IvankaTrump) May 17, 2020
Let’s just say that none of it is a strategy that even the most unconventional CMO would sign up for.
Up until now, it’s exactly Musk’s idiosyncratic approach that has driven the legend (and sales) of Tesla. I spoke to several major advertising agency execs on background, and all point to Musk’s canny ability to make the Tesla brand in his own image and have it be the sole driving force. Like many Silicon Valley success stories, here was a founder who wasn’t afraid to be his company’s spokesperson. To make the bold claims—and then do the work to back it up.
Tesla has changed how many people looked at how the auto industry and its customer experience worked. The company has taken 21st Century behaviors like automatic software updates and direct-to-consumer sales and brought them to a product category largely mired in 20th Century habits.
Tesla was just a car in the same way that the original iPod was just an MP3 player.
Add to this romanticism the added societal value of electric vehicles, and Musk was offering potential customers more than just a new car.
In a November 2019 Bloomberg survey, about 55% of respondents said that their opinion of Musk influenced their decision to purchase a Tesla. “It’s rare to see the head of a company put so much of themselves into their company,” customer Deanna Sherry told Bloomberg. “I have no clue what the head of Ford looks like. And I only know Nissan because he went to jail.”
The Jobs paradigm
Having a founder as the emotional lynchpin of a brand is nothing new.
Look no further than Steve Jobs.
The Apple founder is the poster child for company leaders who were also the face of the brand, the person people associated with that name and logo over anyone else. Yet Apple was also one of the best—and most prolific—brand advertisers in the world.
Sure there was Jobs’ iconic black mockneck shirt and jeans uniform, but there was also the Ridley Scott-directed “1984.” Jobs first announced the iPhone in January 2007 at Macworld Expo, but its official introduction to the world was about a month later with a new ad “Hello” during the Oscars.
Richard Branson is another founder and face of the company, whose Virgin empire has largely been driven by his outgoing, swashbuckling personality. Yet again, whether it was record stores, airlines, or mobile phones, the Virgin brands balanced the public image of the founder with brand advertising of their own.
That balance can be a driving force for brand growth, as both Apple and Virgin have illustrated. That founder’s voice, along with the brand’s own identity, can work together or in parallel, giving customers and the popular culture a choice of where to pick and choose what they like most about the brand. Jobs has been called a bully and a tyrant, but because that wasn’t all there was to Apple’s brand, you could just ignore all that and laugh along at the lovable “Mac vs PC” guys. Jobs himself often talked about the importance of broader brand advertising. When the company launched its first “Think Different” campaign in 1997, he knew they’d be criticized for not talking more about the specifics of the computer. “But we got to let people know who Apple is,” he said, “and why it’s still relevant in this world.”
Do we know who Tesla is?
For so long, Musk’s eccentric style, whether chuffing blunts with Rogan or touting new solar energy roof tiles, has been wholly fused with Tesla’s image as a nontraditional automotive or energy company. Aside from the inherent limitations of sheer reach by choosing not to invest in paid advertising, there are also the risks of betting your entire image on one voice.
All it takes is one yank of the steering wheel into The Full Papa John to destroy years of goodwill for the brand.
After founding the popular pizza chain, John Schnatter was the face of the company, appearing in ads and mugging for the cameras with celebrities and sports stars as part of the brand’s sponsorships. That took a turn in late 2017, when Schnatter blamed the NFL’s response to kneeling players protesting against police brutality and racial inequality for his company’s disappointing financial results, and he resigned as CEO amid the resulting backlash. Seven months later, Schnatter was forced to apologize and resign as chairman of the Papa John’s board after it was revealed he used the n-word on a conference call. Schnatter has filed a lawsuit that contends he was expressing disdain for racism, that his use of the word was paraphrasing someone else, and was never directed at any individual or group. Still, Papa John’s has done just about everything it can to distance itself and its brand from its namesake.
Schnatter, meanwhile, can be found giving TikTok tours of his $11 million Kentucky mansion. It’s all a little too possible to see this end for Musk, pending his currently in-flux real-estate situation.
It doesn’t have to be that way. Maybe this latest emergence of loose cannon Twitter Musk is a perfect opportunity for Tesla to start having a brand voice of its own.
Not to replace its founder—no, he still has far too many fans for that—but merely to establish a parallel personality that may better represent its employees and customers beyond tweeting on a whim. It would also tie in nicely with the first deliveries of the anticipated Model Y electric SUV, which started in mid-March, and the continued hype around the forthcoming Cybertruck.
I'm gonna tell my kids this is the first pick-up pic.twitter.com/RyNcYfIZ33
— Tesla (@Tesla) November 23, 2019
Apple notwithstanding, tech companies have never been quick to embrace brand advertising, relying instead on press coverage and word of mouth.
Eventually, though, the other tech giants like Google, Amazon, Microsoft, and Facebook all reached a scale where they felt the need to be more assertive in telling us, as Jobs put it, who they were. Google, for example, didn’t air its first TV ad until 2010. When Google first aired “Parisian Love” during the 2010 Super Bowl, it’s not like it needed more people to use its search engine. This was pure image management. Since then the tech giant has created similarly emotional stories tied to its products that have arguably helped inoculate it against public fears over personal data security, privacy, and more.
Tesla’s numbers are impressive, but sooner or later, the company is going to have to justify its ballooning stock and valuation with sales far beyond its current output. Obviously advertising isn’t the answer, but it can certainly be a significant part of it.
Imagine if Musk chose to flip traditional car ads the same way he did traditional auto manufacturing? Or even just make a proper spot that didn’t involve the surprises of broken armored glass or an awkward dance?
Sadly, when it comes to car ads, Laurence Fishburne’s Morpheus is already taken.