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The $145 Billion Marketing Strategy of Tesla vs Opel

The $145 Billion Marketing Strategy of Tesla vs Opel

I bought my first car in 1985. It was a third-hand sunburnt Opel Kaddett. I paid a little over R3,000 (equivalent to $202.00) and it was the most reliable car I’ve ever owned. It was built like a tank, would start without fail, and never broke down. That car gave me a wealth of fond memories. Once a month, a friend and I would do some work under the hood. We changed the spark plugs, checked the alternator, and gave it an oil change. We knew exactly how it worked and what parts were needed for the car to work. It was relatively simple. Eventually, I sold the car in exchange for a plane ticket to come to the US, but I wouldn’t be surprised if it’s still on the road somewhere in South Africa giving its current owner immense joy.
 
Since then, I’ve owned and least 20 cars. Right now, I’m driving my second Tesla. I love it. The car couldn’t be more different than my Opel, but it was designed to perform the same duty. To get me safely from point A to point B. The Tesla has a lot more bells and whistles, but it’s less reliable and more finicky than my Opel, especially in cold weather. Other than fixing a flat, I wouldn’t know where to begin if the car broke down. No spark plugs. No carburetor. No oil. There’s only a battery and some windshield fluid. It does have some really cool features (like playing Netflix) but at the end of the day, it’s still a car.
 
Tesla is now the most valuable car company in history and at a $145 Billion valuation is worth more than Ford and General Motors combined. Ford sold more than six times as many cars as Tesla, and GM sold 20 times as many.
 
Why?
 
Marketing!
 
Tesla is being marketed and valued as a tech company, not a car company, but there is about as much tech in a Ford as there is in a Tesla. “Tech” companies are the shiny new penny. And this isn’t only happening in the car industry. Tech companies are “cool”. Their founders, CEO’s, and Evangelists preach of things to come. Great marketing has the ability to convince people that the dream is something to buy into and if you don’t buy in, you’re going to miss out and regret it.
 
My thought – if it looks like a car, it’s probably a car company.
 
Side note on marketing – This week we find ourselves looking back at the Iowa caucus shit show. In case you missed it, Iowa developed an app that was supposed to count the votes and perform more efficiently. It failed miserably. A few days later in New Hampshire, voters used graphite pencils on paper and people successfully counted the ballots. Go figure.

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