Chaper # 6 Consumer Decision Making

How Tesla is changing consumer behavior, the world and the way we buy cars:

Tesla’s story is one that’s difficult to not fall in love with. Its vision of the future is enchanting. Per Elon Musk, Tesla’smission is to accelerate the advent of sustainable transport by bringing compelling mass market electric cars to market as soon as possible. Tesla goals:

1. Build a (electric) sports car that everyone wants (Roadster)
2. Use that money to build an affordable car (Model S)
3. Use that money to build an even more affordable car (Model 3)
4. While doing the above, also provide (via owned or partnered solutions) zero-emission electric power offerings to build out the infrastructure to support the cars and a new standard of energy (Supercharger network, Powerwall, offering a modestly sized and priced solar panel from SolarCity, etc.)

Why Tesla has the most loyal customers:

Tesla Motors' (TSLA) cult-like following has catapulted the electric-car upstart into a global market flush with adoring fans. Unlike traditional automakers such as Ford and GM, Tesla doesn't have a massive advertising budget, nor does it conduct multinational marketing campaigns. Instead, Tesla relies on word-of-mouth marketing and mall showrooms for selling its cars. This works because of Tesla's tremendous brand loyalty.

In fact, Tesla Motors received the highest owner satisfaction score in Consumer Reports' annual survey last year. According to the magazine, "Owners of the Tesla Model S gave it the highest owner-satisfaction score Consumer Reports has seen in years: 99 out of 100.

Make an enemy

Tesla's enemies, on the other hand, are vehicles with internal combustion engines and big automakers. Many EV drivers today derive an emotional attachment from driving something that isn't your typical gas-powered car. 

Another advantage for Tesla is the fact that it offers customers something different: new tech from a new company.

Tesla has also created an enemy out of auto dealer associations, which are fighting Tesla's disruptive model of selling its cars directly to consumers through its own company-owned retail stores.

Scores of Tesla drivers have expressed their loyalty to Tesla by showing up in person at state capitols to protest dealer suits against the EV maker in various states such as Texas and Missouri.According to various psychological studies, this outpouring of support and loyalty wouldn't be nearly as strong without an enemy, so perhaps the ongoing dealership battles are a blessing in disguise.

Establishing an emotional connection

Another way that psychologists explain brand loyalty is through emotional connection. All of the most recognizable brands today have one thing in common: They make an emotional connection with consumers. One of the easiest ways for a brand to do this is by standing for something. 

Tesla wins major points in this regard because it is passionately dedicated to promoting mass adoption of electric vehicles in hopes of one day solving our planet's energy problem. People feel good about driving a Tesla because they no longer need to buy gas, and as a bonus, they're helping the planet in the process.

Many Tesla drivers have launched meet-ups or social gatherings for fellow owners and enthusiasts to connect with one another.

Consumer reports

In today's increasingly social world, transparency is key for creating enduring brand loyalty. Companies want to build lasting relationships with their customers, and one way to do so is through open communication. No automaker does this better than Tesla Motors.

Tesla in recent years has built its reputation for quality and customer support by communicating with consumers on social media and its own blog.