Tesla Segmentation, Targeting, and Positioning (2023)


Tesla Motors Inc. was established back in 2003 by Marc Tarpenning and Martin Eberhard in Palo Alto, California, USA. Today, this highly successful alternative fuel production company is merely called Tesla Inc.

In the beginning, Tesla focused mainly on the manufacture of electric vehicles. However, over the years, it has expanded its range of services. Tesla is now involved in the following activities;

  • Energy generation.
  • Manufacturing of energy storage systems.
  • Production of solar-powered equipment.
  • Installation and maintenance of Tesla sustainable energy systems.

As a matter of fact, the vision of Tesla is a world driven by renewable, sustainable, and environmentally-friendly energy. Their mission statement simply states their desire “to accelerate the world's transition to sustainable energy.”

Currently, the California-based alternative fuel vehicle production company has several galleries and stores in the US. Tesla also has stores and showrooms in more than 30 countries worldwide. They also have a global staff strength of over 70,000 skilled and semi-skilled individuals.

By 2020, Tesla had recorded an industry high operating margin over 6%, with over USD$2.5 billion in free cash flow. The free cash flow recorded in the final quarter of 2020 only was just a hundred thousand US dollars short of 2 billion.

Despite the global economic downturn at the height of the COVID-19 pandemic, Tesla would still post comparatively high sales turnover, revenue, and profit margin figures. This was mainly due to the well-crafted business development plan driven in no small way by a thoroughly researched and prepared Tesla market segmentation, targeting, and positioning strategy.

Market Segmentation of Tesla

Tesla as an organization is divided into five key departments or divisions, namely;

(Video) Tesla Presentation on segmentation targeting and positionning : Popov, Bouilly, Beuvain, Gavagnin

  • Energy,
  • Engineering and Production,
  • HR and Communication, and
  • Sales and Software.

Tesla segmentation, targeting, and positioning involve a series of activities that are carefully planned, prepared, and implemented by the sales division with the full support of other divisions under Tesla's organizational structure.

These activities involve the identification of particular population groups, otherwise called segments. The segments share a similar vision/mission statement as Tesla. These segments are also seen by Tesla as the most likely to provide regular consumers with their products and services.

The identification of population segments is subsequently followed up by identifying the wants and needs of these segments. Tesla then manufactures products, including electric vehicles, that are capable of satisfactorily meeting the needs of consumers within their identified population segments. Tesla then came up with a marketing mix to position itself as the leading brand in the industry and marketplace.

Market Segmentation is the first in the series of activities carried out by Tesla's sales division. Tesla identifies four main types of segmentation, and these include; Geographic, Demographic, Behavioral, and Psychographic segmentation.

The Tesla Geographic segmentation has to do with the region and population density. Demographic segmentation incorporates age, gender, occupation, and the life-cycle stage.

The Behavioral segmentation looks at the status of consumers, their degree of loyalty, personality traits, and the reasons why they need Tesla products and services.

For Psychographic segmentation, the main focus is on the social class and lifestyle of prospective Tesla target marketgroups.

(Video) Tesla Market Segmentation - Sugar 1

Targeting of Tesla

It is no secret that Tesla's targeting strategy primarily focuses on the high-income earning upper-middle class. This consists of entrepreneurs and business executives living in plush urban areas. These individuals are often appreciative of the green movement and even ardent supporters in their own right.

They are also tech-savvy, trendy, fashionable, and sophisticated people. Tesla's target consumers are craving the unique and a taste for the exotic. Often these customers actively seek out premium quality luxury cars, and they are not too bothered about the price range.

Typically, any individual with an annual income above USD$100,000 would be an attractive prospect for this high-end company. Tesla targets the wealthy baby boomer generation, but its doors are still open for other generations.

Industry observers suggest that the average age of customers of the Tesla Model S electric car is about 54 years. On the other hand, the median age for customers of Model X is about 52 years. The demographic for owners of Tesla products may be on the older side, but many young people between the ages of 25 and 45 years are known to purchase Tesla products equally. The Tesla Model 3, for example, is known to have a greater appeal to a younger age group compared to Model X or S.

Ultimately, Tesla fully understands its target market group and uses all its resources to provide sustainable energy products that meet the needs of this high-end target audience.

Positioning of Tesla

It is interesting to note that this electric vehicle producing company has adopted two main positioning strategies. The first Tesla positioningstrategy is known as 'Mono-segment Positioning,' while the second is called 'Anticipatory Positioning.'

Tesla's positioning involves not only the selection of a marketing mix but also the implementation of the marketing mix that is best suited for Tesla's target audience.

(Video) 27.2 Tesla's segmentation problem

At this point, Tesla is mainly interested in meeting the needs of those consumers greatly concerned about the adverse effects of oil and gas on the environment.

This segment of consumers is willing to take action to improve their immediate environment. They do so by purchasing products powered by renewable, sustainable energy, such as; electric vehicles, energy storage systems, and other related Tesla products.

For now, the Mono-segment positioning strategy targets only the wealthy and affluent members of society. Those that can afford the high cost of owning a one-of-a-kind Tesla alternative fuel vehicle. However, the long-term goal of Tesla is to provide sustainable energy products and services that are affordable to everyone on the planet. To achieve this, Tesla has put in place plans to move from a Mono-segment positioning stance to a more multi-segment positioning focus.

However, Tesla also acknowledges that this would take time, a lot of grassroots orientation, lower production costs, and changes in government policies globally, amongst many other seismic changes.

This is where the Anticipatory-segment Positioning strategy of Tesla is most effective. Tesla positions some of its products and services to meet the needs of a market segment with a comparably low turnover. This is done with the anticipation that the turnover of the market segment will improve in the long run.

The Anticipatory-segment positioning strategy of Tesla is better exemplified by the launch of Powerwall 2 and Powerpack 2. These are two affordable energy storage systems designed, produced, and made available for sale to upper- and middle-income earners.

Table - Tesla Segmentation, Targeting, and Positioning Illustrated


Mind Map

Tesla Segmentation, Targeting, and Positioning (1)

(Video) STP Marketing Explained (Segmentation, Targeting & Positioning Examples)

Key Takeaways

Tesla Inc. specializes in the production of environmentally-friendly products, including electric-driven vehicles, energy storage, and solar-powered systems. They have been able to cater to their short and long-term future through the use of the Tesla segmentation, targeting, and positioning strategies highlighted in this article.

You can have regular access to this report by downloading it in PDF format. The PDF format allows you to view the Tesla segmentation, targeting, positioning table, and mind map Illustrated above with more clarity. If you want to be able to compress, split, edit, convert or even redact information on your PDF file, you can do so by downloading 'PDF Agile.'

PDF Agile is a complete PDF desktop solution that offers you a variety of features, including background change, text and area highlights, bookmark, page resizing, and print options. PDF Agile is available forfree download on Windows OS desktop computers today.


Tesla Segmentation, Targeting, and Positioning: overview

By John Dudovskiy, May 1, 2021


Marketing Strategy of Tesla

(Video) MAR101 - CH6 - Segmentation, Targeting, & Positioning

May 29, 2019, By Hitesh Bhasin



What is Tesla's segmentation method? ›

Tesla uses mono-segment positioning. Accordingly, the alternative fuel vehicles manufacturer targets individuals concerned with negative environmental implications of oil and gas consumption.

What positioning strategy does Tesla use? ›

The strategy of Tesla is to enter at the high end of the market, where customers are prepared to pay a premium, and then drive down market as fast as possible to higher unit volume and lower prices with each successive model.

What are the key segments of Tesla? ›

Tesla operates through two main business segments: automotive and energy generation and storage.

What is Tesla target audience age? ›

Tesla owners are also typically younger; around 70% of drivers are 34 or younger, falling primarily into the millennial and gen Z generations. They also found that Tesla drivers were also more educated on average and earned a higher income. One-third of all Tesla drivers have either a master's degree or a Ph.

Does Tesla use image segmentation? ›

Our per-camera networks analyze raw images to perform semantic segmentation, object detection and monocular depth estimation. Our birds-eye-view networks take video from all cameras to output the road layout, static infrastructure and 3D objects directly in the top-down view.

What are the 4 segmentation process? ›

Demographic, psychographic, behavioral and geographic segmentation are considered the four main types of market segmentation, but there are also many other strategies you can use, including numerous variations on the four main types.

What is Tesla's secret strategy? ›

In his original master plan, Musk said Tesla's strategy was to start by building a sports car (the original Tesla Roadster), then use the money to build an affordable car (that was the Model S), then use that money to build an even more affordable car (that was the Model 3).

How is Tesla positioned in the electric car industry? ›

Tesla's share of the US market for electric vehicles has been comfortably north of 60% since 2018. But its lead has been slipping. Though still the dominant player, Tesla's market share is down from 70.5% in 2021 to 63.5%, according to data from S&P Global Mobility, which tracks registrations of new EVs.

What is the most common positioning strategy? ›

There are three standard types of product positioning strategies brands should consider: comparative, differentiation, and segmentation. Through these strategies, brands can help their product stand out by targeting the right audiences with the best message.

Who is the target audience for electric vehicles? ›

The EV industry mainly targets those in higher income brackets who are able to afford them and also may view the vehicle as a status symbol. Another target market is those interested in social change.

What segment is Tesla Model Y? ›

The Model Y is based on the Model 3 sedan platform. It shares an estimated 75 percent of its parts with the Tesla Model 3, which includes a similar interior and exterior design and electric powertrain. The Model Y fills a smaller and less expensive segment than the mid-sized Tesla Model X.

How does Tesla market their products? ›

Tesla relies on word-of-mouth advertising as its primary technique of spreading the word about its products. Customers spread the word about it to others who may be interested. Tesla offered the greatest customer experience it could afford, making its consumers pleased and excited about its product.

What is Tesla target customer segment? ›

The Tesla target demographic is largely established families with kids, including younger children or teenagers, and they are mostly professionals, executives, senior managers or hold other high-income positions.

What are the demographics of Tesla company? ›

22% of Tesla employees are women, while 78% are men. The most common ethnicity at Tesla is White (52%). 24% of Tesla employees are Hispanic or Latino. 11% of Tesla employees are Asian.

How does Tesla satisfy customer needs? ›

The company sells the cars directly to its customers, without any third parties being involved, meaning they have complete control over the messaging and relationship to offer a consistent experience.

Does Tesla operate in a niche market? ›

To move with the changing times, Tesla focuses on launching new offerings that target a wider range of consumers. To stay competitive in the niche market, Tesla Motors has expanded its operations globally with locations in the U.S. and China.

How does Tesla use direct marketing? ›

Tesla's marketing strategy, then, goes against the trend of developing TV advertisements and pushing its products onto consumers. Instead, Tesla focuses on word of mouth advertising, and referrals. Essentially, Tesla markets to its customers by not directly marketing to them.

What is model based image segmentation? ›

The Model Based Segmentation Framework provides you with the infrastructure for the fully automatic segmentation of organs and their substructures in multi-modal images. This is achieved by applying a generic organ model to the images of a specific case.

What is segmentation targeting and positioning? ›

Segmentation, targeting, and positioning (STP) is a marketing model that redefines whom you market your products to, and how. It makes your marketing communications more focused, relevant, and personalised for your customers.

What are the five 5 segmentation targeting and positioning steps? ›

Market Segmentation Process.

The process of market segmentation consists of 5 steps: 1) group potential buyers into segments; 2) group products into categories; 3) develop market-product grid and estimate market sizes; 4) select target markets; and 5) take marketing actions to reach target markets.

How to do segmentation targeting and positioning? ›

To use the model, start by segmenting your market into groups. Next, choose which of these you want to target. Last, identify how you want to position your product, based on the personality and behavior of your target market.
STP stands for:
  1. Segment your market.
  2. Target your best consumers.
  3. Position your offering.

What are Tesla's key success factors? ›

Strong scientific research and innovation ability is the most important factor for Tesla's success.

Who is Tesla's biggest competitor? ›

Ford, GM, NIO, and Volkswagen are four of Tesla's main competitors. In 2022, the Chinese manufacturer BYD sold more than 1.85 million plug-in electric cars, more than tripling its 2021 result of 593,745.31 Another Chinese company, SGMW, surpassed 1.6 million units the same year, so both companies should be considered.

How does Tesla beat its competitors? ›

First-mover advantage: Tesla has been around the EV industry a lot longer than its competitors. It enjoys brand recognition, word-of-mouth advertising, and a much more expansive charging network thanks to its time in the market.

What is Tesla's unique selling proposition? ›

They have developed a unique selling proposition that revolves around the fact that their cars are the only ones that can be driven without gasoline. Tesla's strategy revolves around two main points: 1) creating an amazing driving experience and 2) incentivizing people to switch to electric cars.

What attracts customers to Tesla? ›

It specializes in creating high-quality electric cars for the general public around the globe and clean, renewable electric energy. They are known for their vehicle's incredible on-road performance. What may come to you as a shock is that Tesla is renowned worldwide for its $0 marketing approach.

Why do consumers prefer Tesla? ›

Tesla's brand recognition and perceived elite status increase demand for these vehicles. The key factors that drive demand for all EVs involve the cost of gasoline, the available features (all-wheel drive, sedan versus larger vehicles), availability of battery charging stations, and the appeal of the “green” movement.

What are the 4 types of positioning strategies? ›

There are four main types of positioning strategies: competitive positioning, product positioning, situational positioning, and perceptual positioning.

What are the 7 positioning strategies? ›

The seven basic types of positioning strategies are:
  • Product characteristics or consumer benefits. In using this strategy for positioning, the focus is on quality. ...
  • Pricing. ...
  • Use or application. ...
  • Product process. ...
  • Product class. ...
  • Cultural symbols. ...
  • Competitors (relation to)
Feb 4, 2020

What are the 3 C's of positioning? ›

This article explains why you must understand the 3 Cs of successful positioning—your customer, channel, and competition—as well as you understand your B2B product, service, solution, or company.

What are consumers looking for in electric vehicles? ›

Charging & Range

Charging and range remain the top priority for consumers entering the electric vehicle market. Whilst having their differences, the two go hand-in hand as consumers worry about how to charge, and how often they can charge their vehicle.

Why do consumers prefer electric vehicles? ›

Among their reasons: More than 3 in 10 U.S. adults say that it costs less to charge an EV than to refuel a gas car (33 percent), overall lifetime costs are lower (31 percent), and maintenance costs are lower (28 percent).

What age group buys electric cars? ›

According to the survey, Millennials (ages 25-40) are most eager to go electric, followed by Gen Z (ages 16-24). Boomers (ages 57-75) are the least likely to show an interest in buying an EV.

What segment is Tesla Model 3? ›

The Tesla Model 3 is a compact executive sedan that is battery powered and produced by Tesla.

What makes Tesla unique? ›

It all starts with a different sales model. Zucchi explains, "Unlike other car manufacturers who sell through franchised dealerships, Tesla sells directly to consumers. It has created an international network of company-owned showrooms and galleries."

Is Tesla Y considered luxury? ›

Yes, the 2023 Model Y is a good luxury electric SUV. It provides up to 330 miles of range and sports-car-like performance, including a sub-4-second zero-to-60 sprint with select models. Handling is more like that of a small sedan, but passenger and cargo space fit the bill for a crossover.

What is Tesla's main market? ›

While the United States continues to be Tesla's most important target market, the company also aims to tap into the Chinese and European markets.

Why does Tesla sell direct to consumers? ›

Tesla earns more profit from its vehicles because it sells directly to consumers. Ford has already indicated that it could save money by selling its own vehicles.

What is the stereotype of Tesla owners? ›

The typical Tesla buyer turned out to be rather stereotypical in a new demographics study. The owners of cars from Elon Musk's electric vehicle brand appear to be predominantly male Millennials or Gen-Z folks living in affluent urban areas.

What is the organizational culture of Tesla? ›

Tesla employees are encouraged to work hard and smart while taking necessary breaks in-between to prevent a mental shutdown. The culture at Tesla also empowers teams to work closely together and experiment with new things, yet keeping them aligned with the business goals.

Does Tesla promote diversity? ›

Tesla has laid off both the president of its LGBTQ+ community and a lead involved in diversity and inclusivity programs at the company.

Is Tesla product oriented or customer oriented? ›

Own The Customer Experience

One of the reasons Tesla stands out from the competition is that it does everything on its own, from production to sales. Most other car companies partner with dealerships to sell and service their cars, which puts customer experience in the hands of a third party.

What is business aim for Tesla? ›

Tesla founder and CEO Elon Musk launched the company with the mission, “to accelerate the advent of sustainable transport by bringing compelling mass-market electric cars to market as soon as possible.”1 This mission is the backbone of Tesla's successful business model.

How does Tesla have a competitive advantage? ›

Tesla's competitive advantages include the adoption of advanced technologies, diversification into other businesses, the creation of a supercharger network, superior designs, and an organizational culture that is based on honesty.

What diversification strategy does Tesla use? ›

Tesla uses market penetration strategy extensively. The company is focused on selling its Model S, Model X and Model 3 electric vehicles, Powerwall 2 and Powerpack 2 energy storage products, as well as, solar panels, inverters, racking, electrical hardware and monitoring devices in the US and 35 other countries[1].

What are the segments of the EV market? ›

India Electric Vehicle Industry Segments

Commercial Vehicles, Passenger Vehicles, Two-Wheelers are covered as segments by Vehicle Type. BEV, FCEV, HEV, PHEV are covered as segments by Fuel Type.

Is Tesla a niche market? ›

Tesla started as an electric sports car niche player, eventually turned into a mass manufacturing electric car maker.

How does Tesla reach its customers? ›

Customer Experience

Tesla relies on word-of-mouth advertising as its primary technique of spreading the word about its products. Customers spread the word about it to others who may be interested. Tesla offered the greatest customer experience it could afford, making its consumers pleased and excited about its product.

What type of market is Tesla in? ›

Tesla's work in an oligopoly market which have a limited competition in which a few producers control the majority of the market share and typically produce homogenous products.

What is the strategic intent of Tesla? ›

Tesla's vision is to “create the most compelling car company of the 21st century by driving the world's transition to electric vehicles,” while its mission is “to accelerate the advent of sustainable transport by bringing compelling mass-market electric cars to market as soon as possible.” Tesla used a transitional ...

What is model segment? ›

A customer segmentation model is a specific way of dividing your audience into groups based on shared characteristics. For example, demographic segmentation would involve creating audience sub-groups based on their demographic similarities, like age, gender, location, job title, and income.

Why is Tesla's strategy successful? ›

Tesla's success in reducing costs was to minimize risk by keeping very little inventory. Such inventory cost reduction was achieved by batch production after prepaid orders were obtained. Its order-production strategy offers a few advantages.

How is Tesla positioned in the EV market? ›

Tesla's share of the US market for electric vehicles has been comfortably north of 60% since 2018. But its lead has been slipping. Though still the dominant player, Tesla's market share is down from 70.5% in 2021 to 63.5%, according to data from S&P Global Mobility, which tracks registrations of new EVs.

Who are the target customers for EV vehicles? ›

Automakers can confidently target millennials, who have an early adoption attitude and broad tech knowledge. Adoption among consumers can be enhanced with advances in battery technology, which will result in increased range.

What marketing strategies can attract the consumers and increase the sales of electric cars? ›

Winning strategies for EV marketing
  • Leverage social media. Social media is a great way to reach your potential customers as well as engage existing ones. ...
  • Focus on email marketing. ...
  • Highlight customer reviews. ...
  • Rope in influencers. ...
  • Get your targeting right. ...
  • Leverage an omnichannel marketing approach.
Jan 2, 2023


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