I have been a bit obsessed with Tesla lately. Primarily I am obsessed with the Tesla Model 3. With a base price tag of $35k before incentives this is Tesla's model for the every man. I am not just excited about the prospect of a new car though, Telsa's product launch process has me acting like an Apple fanboy....I mean I need one right!?
Led by Elon Musk, Tesla is taking a totally different approach to rolling out a new car model. Instead of a commercial with a shiny new car rolling through curves in a serine setting the Model 3 was revealed at an invite only launch party. You can watch the video of the reveal on Tesla's website, the crowd is going nuts. Do you think anyone walked away from that party without reserving their model 3? I think not.
Buyers can reserve their Model 3 on Tesla's website for $1,000. Tesla is already up to around 400,000 reservations! They have $400,000 dollars in the bank and have only just this past week started rolling the model 3 into production. That means 400,000 customers have purchased their product site unseen. Can you imagine buying a car sight unseen a couple of years ago?
Three things stick out to me as attributing to the demand around the Model 3 launch:
- It's about the brand. The first models Tesla rolled out, the Model S and Model X, carried a price tag of $80-125k. That is way outside of most peoples budget. That price tag made the original Tesla models luxury vehicles that the wealthy were privileged to drive. They are now launching a model that is going to run customers around $27k after incentives are applied. They created a luxury brand persona and are now offering that persona at an affordable price.
- It's about the marketing. Building hype and a feeling around the launch of the Model three left you feeling that if you were in the know you are an insider. Tesla created a bit of Apple magic where customers wait hour or days in line for their new products. Additionally, Tesla has mostly used the web to push their products, you don't see them spending money on TV adds to push this out, yet they are creating huge demand. Elon Musk knows how to harness the power of internet marketing.
- It's affordable. Tesla has put this car within reach of the masses. The car that was out of reach for most of us is now readily available (if you will wait for yours to be delivered sometime in 2018 or beyond). They hit the pricing sweet spot!
The Model 3 will be the car that makes or breaks Tesla. If they are successful, this is a game changer and Tesla is all of a sudden a major car manufacturer. If this fails...Tesla fails. Either way we could all learn from how Tesla has leveraged their brand, internet marketing, and pragmatic pricing to Make It Rain.
-Kent