Why You Won't See a Tesla Commercial

Why You Won't See a Tesla Commercial

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This video is sponsored by Squarespace. Most companies depend on advertising to inform  persuade and remind consumers of their products   and services. But not Tesla. You won't see any  Tesla ads anywhere. Not online. Not on the radio.   And not on television where sometimes companies  can spend millions on just a single ad. Norway,   coming for you. It's unclear how much General  Motors spent on this Super Bowl commercial but   the going rate for a 30-second spot is $5 million.  In total, GM spent $2.7 billion in advertising and   promotion in 2020 - that's actually down a billion  from the year before due to disruptions from COVID-19.  Here's the advertising cost per vehicle sold  for the leading automakers. Genesis, part of the   Hyundai Motor Company, dished out $2,000 per vehicle in 2019 whereas Tesla   spent 14 cents, incurring costs from promotional  activities rather than traditional advertising.   So why does Tesla not run ads? It doesn't have to  persuade anyone to buy its electric cars. Back in  
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the day, Tesla couldn't keep up with demand. There  was no need for advertising. Thank you to everyone   that ordered the car. We love you. Customers  had to wait years to get the car they ordered   like the $35,000 Model 3, its most affordable model  yet. And when they did, a million people watched the   handover on Tesla's YouTube channel. Its streamed  events frequently rake in millions of views. Oh my (expletive) Well, maybe that was a little too hard.   The Cybertruck unveil where a steel ball  shattered the armored glass also apparently   helped smash sales. Oh man. CEO Elon Musk suggested the company had received 250,000 orders of the electric pickup less than a week later. All without having to pay for advertising. Still, even events fail to fully explain why Tesla doesn't advertise. Musk has gone on the record to say he'd rather use that   money to make the product great. Tesla's research  and development budget has been increasing   drastically over the years while GM's has been  steady and recently dropped slightly in 2020.  
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It still spends considerably more than Tesla - it  does own several car brands. However, Musk's company   is closing the gap. The thinking behind Tesla's  focus on design, engineering, and testing is that   if you build the best car, the product will speak  for itself or have others speak for it free of   charge. Celebrities and influencers have showered  plenty of affection on the company. Jaden Smith   showed off his pink Model X in a music video. Kanye  West has made no secret of his Tesla love affair. YouTuber ZHC surprised Mr Beast with a custom  designed Tesla. Not to mention, Tesla also receives   an abundance of free promotion from Musk's other  company SpaceX. Model X's carried NASA astronauts   to the launch pad for flights aboard Falcon 9  while the Falcon Heavy launched a Tesla roadster   on a path to Mars. That event generated a flood of  media attention but the relationship between Musk   and the traditional news media hasn't always been  so rosy to put it lightly. He's criticized media   coverage. For example, about a deadly crash of a  Model X on autopilot mode or production delays  
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involving the Model 3. Musk suggested journalists  write negative stories in order to get maximum   clicks and because gas and diesel car companies  advertise with these news organizations   while Tesla does not - inferring big oil plays  a role behind critical coverage of Tesla which   reporters have denied. You might think Tesla would  respond with a slick public relations campaign   but actually, Tesla got rid of its PR team in  North America although it still has one in Europe.   While most companies use their PR departments  to communicate information to journalists,   Tesla appears to be cutting out the journalists  in favor of communicating directly with the public  via social media. Musk's belief in the power of  social media is so strong that he once hired a   meme maker as Tesla's social media manager. Adam  Koszary had a sheep to thank for the job. He caught   Musk's attention after tweeting out a photo of  this absolute unit when he worked at a British   museum. It went viral and for some reason, Musk  ended up changing his profile picture to that   of the big fluffy fella which generated even more  chatter online. His 50 million follower count on  
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Twitter is far greater than that of the leading  automotive companies combined. He often replies to   people asking for help like the time singer Sheryl  Crowe got stuck in a parking lot with a dark   Tesla display. It's not just the rich and famous  who have his attention. Musk routinely answers   questions from the general public. In many ways,  he himself is a walking advertisement for Tesla   though occasionally it's gotten him into trouble.  The U.S. Securities and Exchange Commission   sued Musk for fraud when he tweeted he  was considering taking Tesla private at   $420 a share - a reference to marijuana. And that  funding had been secured. Controversial or not,   Musk puts his companies in the spotlight without the  need to pay for it. It should be noted that some   other companies have employed the same strategy. Starbucks relied on word of mouth to grow. Costco doesn't pay for advertising. Neither does Krispy Kreme.    So, Tesla is far from the only brand that doesn't rely on paid advertising. It does, however, rely on its website for sales. You don't need to run a company or be a business to realize the importance of having a website. It's great for starting a blog  
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or showing off your work. That's what I did as  a journalist years before Squarespace became my   sponsor. And it helped me land a lot of reporting  jobs. Squarespace is super easy to use. You don't   need any experience in website building whatsoever.  There are many beautiful templates to choose from.   You can try it out for free for a couple of weeks by  heading to squarespace.com/newsthink. The link is   in my description. And when you're ready to launch  use my discount code: NEWSTHINK to save 10% of your   first purchase of a website or a domain. Thanks  for watching. For Newsthink, I'm Cindy Pom.

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