Tesla scraps Elon Musk’s no-advertising mantra as stock nosedives nearly 30% this year

Amid rising competition and declining performance, Tesla is ditching CEO Elon Musk’s previous distaste for marketing and moving forward with digital marketing in search of a much-needed return.

The company spent $6.4 million on digital advertising last year Wall Street Journal report, quoting data from Vivvix, a provider of advertising platform MediaRadar. The company’s advertising budget last year was less than $175,000 Vivvix estimates that the company will spend in 2022. Tesla has spent 900 times on digital advertising focused on the US in the first quarter compared to a year ago, according to a report by the market intelligence company Sensor Tower. .

Tesla’s ads were focused YouTubeSensor Tower reported, but included the campaign FacebookInstagram, Googleand those with Musk X platform, based on an analysis of publicly available data.

Many ads promote the company’s Model Y car, calling for you to buy it before prices go up on April 1. Some of Tesla’s standard features like Autopilot and extra cargo space, while others are showing off. families using the touchscreen to play games or stream video.

Musk and Tesla often reject traditional methods of promotion, relying on word of mouth, referral programs, and stars of his CEO to attract customers. Tesla’s CEO has previously said that the money spent on advertising could be spent elsewhere.

“Tesla doesn’t advertise or pay for endorsements. Instead, we use that money to make great things,” he wrote in a post on X, formerly Twitter, in 2019.

However, Tesla shares ‘approx 30% unknown from January and expand the competition from Chinese EV manufacturers it has recently led Musk to open up more advertising. In response to a question at the annual meeting of shareholders last year in MotherMusk said Tesla would “[T]do a little marketing and see how it goes.”

The industry’s shift in marketing comes as the first three months of the year wind down and analysts prepare for what could be a small turnout for EV manufacturers. Several analysts have already lowered their estimates for the first quarter of auto sales (approximate sales) after Bloomberg reported last week that Tesla is reducing production at its factory in China.

On Wednesday, Wedbush Securities cut its estimate to 425,968 from about 475,000, according to a note. Wedbush’s regular analyst Dan Ives also cut his price target to $300 from $315, although the company reiterated its “outperform” rating for the company.

A recent internal email to employees revealed Musk is not only relying on digital marketing but also aggressive promotions to increase sales of his $12,000-a-year subscription to “drive yourself”. Inside the hatch email this week, Musk said Tesla employees should give potential customers a quick test drive while they pick up their cars.

“I know this will slow down the delivery process, but it’s a priority,” he wrote in an internal email.

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