The customers are the pillars of a business's success, and to get to the customers, you have to advertise your product. This makes advertisement and marketing a core aspect of most organizations. A decline in customers means a decline in sales which also means that profits will be taking a dip. 

So it is not so surprising that marketing budgets take as much as 11 percent of the company’s budget, and about 7.5 percent of the marketing budget comes from the company’s revenue. Overall, tech/manufacturing companies spend the highest in terms of percentage amount of revenue allocated to marketing. 

Take a look at the chart below, that is not the amount of revenue generated though you would be forgiven to think it was. That is the amount of money these companies spend on advertisements. Automobile manufacturers fall under the tech industry which according to the CMO survey spends a huge chunk of their revenue on ads. 

From the chart, you can see just how much goes into paying for customers to see your product and it makes you wonder, how much the company earns if it has to dish out such a huge amount for advertisement alone. And don’t forget, the business will not take a loss, so this amount will become overheads which eventually is included in the cost of manufacturing the product. 

What it means is that the customers will be paying for the ads the company puts out. The math is quite simple, more money spent on ads means a higher unit cost of the car sold. But what if I told you that despite how important advertisement and marketing are to an automobile company, there is one company that seems to defy the odds by not spending a dime on ads, yet somehow manages to remain a household name among car brands?

With just 20 years in the industry, Tesla has defied several odds including winning the much-coveted spot of the most valuable car company in the world, for the very first time in 2020. And it has continued to clinch the lead over the past few years with no other car company coming close to beating it. 

Tesla’s marketing success ought to serve as a blueprint for many startups in the tech industry who, despite having groundbreaking and innovative tech, sometimes struggle to get the much-needed attention, not to mention customers. If you’d like to know how Elon Musk did it, then you are in the right place. Before I get into that, here’s a thing or two about how advertising has evolved over the years. 

From Prints to Post - The Evolution of Marketing

Traditional marketing involves publishing ads in prints like magazines and newspapers as well as paying for a slot on TV and Radio stations for your ads to be aired. Billboards, Mail ads, cold calls, and flyers. Generally speaking, if you are to follow the timeline for marketing you will notice a trend that is consistent with the latest technology. 

First, you had prints, flyers, and billboards, then when TV and radio became popular, marketing became more about commercials and TV ads. Today with the rise of social media which by the way, completely obliterates anything before it, marketing is as simple as uploading a post on Twitter, Facebook, or Instagram. 

This is digital marketing and it has three major advantages over the traditional form of marketing. The first is reachability. About 4.48 billion people use social media and to put that into perspective, we are talking about more than half of the world’s population. Each user is said to use up to 8 social media accounts on average. 

The second advantage of digital marketing is the sheer amount of time users spend on social media platforms. it is projected that the average amount spent on social media will grow from 7 hours in 2022 to about 8 hours in 2025. That means an estimated 4.48 billion pairs of eyeballs scan these platforms every day. At the same time, TV time is expected to grow less and less by the day. 

The third advantage is that digital marketing is relatively inexpensive. You can even market your business for free if you know what you’re doing. 

Tesla which is more like the Gen Z of automobiles has capitalized on this for many years, while veteran car brands like General Motors are stuck on spending billions in marketing campaigns. 

This is how the company managed to become popular with zero ad budgets. But there is more. Yes, Social media is a great platform for advertisement, but not everybody knows how to make use of it. On one hand, are those who pay to host ads on social media platforms, and on the other hand, are people like Elon Musk who have learned to make social media work for them.

In the next section, I am going to show you some tricks and ingenious ways Elon Musk used to market Tesla without spending a dime. 

Advertising - The Tesla Way 

 If there is one thing we know for sure is that Elon Musk “Hates” Advertising. Although recently, he seems to be rethinking his position on the matter, we are still waiting to see what his final decision is. However, we all know that Tesla doesn’t rely so much on regular advertisement as most other car brands, and yet Tesla is a household name. Here is how he did it. 

Elon Musk Is very active on Social Media

Can you recall the name of the CEO of Mercedes? Or General Motors Or Toyota? What about the CEO of Tesla? I bet the last name jumped straight out of your mind before you even had enough time to think it through. 

While the CEOs of most companies tend to stay out of the spotlight and live a very private lifestyle, Elon Musk does the exact opposite. You can always find him in his favorite place, Twitter, where he interacts with his more than 158 million followers. 

Do you know how many company profiles on social media have as much following? Personally, I can’t think of one. Even Tesla only has 21 million followers on Twitter. 

But having lots of followers alone is not enough, despite being a middle-aged man, Elon Musk actually knows a lot about how social media works. He doesn’t just upload formal and relatively boring content. He is witty, sharp and let’s not forget he has a firm grasp of memes. Talk of a real Gen Z thing to know. 

It is not surprising that he can communicate with people across all age groups. He also freely interacts with his followers. You can easily get a response from Elon Musk if your tweet catches his attention. This is very uncommon in many other companies or individuals in high-level positions.

I do not think Tim Cook has ever reacted to a tweet from one of his followers, not even when Musk tried trolling him on Twitter. Perhaps he does so once in a while, but it can’t come close to Elon Musk’s response rate.  Let’s not even talk about the CEOs of other major car companies, that is if they even have an online presence. 

At times, Elon Musk’s online activities may seem too much. But if you think so, then perhaps there is still a lot you have to learn about social media. One thing I have come to accept is that there is an endless appetite for content consumption, and if you make time to put out content, you will always have views and feedback both positive and negative. 

Elon Musk’s active social media presence is pivotal to the success of the zero-budget strategy in that in between his random memes, trolls, and controversies, Musk would chip in a post or two about his latest product. 

In fact, while writing this article, Musk dropped a tweet about the latest Model Y Tesla. And as you can see, the post has already been shared more than 5,000 times. All he has to do is drop a post about one of his products and his followers will take it from there. If this isn’t the best advertisement, then I don’t know what is. This is one reason why Musk can move the market like we saw him do with cryptocurrency.

He is a great storyteller

Elon Musk’s success story is like a tale passed down from one generation to another. I doubt there is anybody in the tech space who doesn’t know about Elon Musk. From his early beginnings as a shy and awkward kid growing up in South Africa to a Tech Mogul who is renowned for his daring and ambitious goal of colonizing Mars. 

It is often said that the secrets of Great men are in their stories and I completely agree. Think about Steve Jobs, Albert Einstein, or any other renowned person you know or admire, I believe there is something in their stories that you find inspiring. Nobody has a perfect story, but then again, it is not about being perfect, but about doing something good that you will forever be remembered for. Stories have a strong attractive force that pulls on those who can relate to it in one way or another. 

This is why founders need to tell the stories of how they started, what inspired them, the struggles they faced, their failures, and their successes. This is one sure way of winning over customers who will stick with you through thick and thin. Not because there are no better products in the market, but because they feel a connection to the company.

When you sell the story of your company, the story eventually sells the company’s products. Think of Steve Jobs and you think of Apple. Think of Elon Musk and you think of Tesla. And there is no age or time where it is easier to get your story to the right audience than it is today. All you need is a social media account, and some #Hashtags and you are good to go. 

He found a cause

Having a cause is like hitting a gold mine in business. The moment your business distinguishes itself by standing for something, it will attract like-minded people to it. Think about Elon Musk, he is a strong advocate of sustainability. His company’s mission statement as well as his many ventures all point to this fact. 

Tesla’s mission is “To accelerate the world’s transition to sustainable energy.” To achieve this, the company mass-produces electric vehicles, solar panels, and batteries. And just in case all efforts fail and the earth becomes uninhabitable, Musk is already a step ahead, working on plans to make living on other planets a reality. Because he is at the forefront of environmental sustainability, there is always a discussion that involves his company’s products. 

Whenever carbon emissions are discussed, the topic of electric cars is raised, and guess which company is going to get involved in that discussion, Tesla. Many other car manufacturers have realized this and are making efforts to manufacture electric cars. But producing both gas and electric vehicles is counterproductive in the grand scheme of things. So all I can say to companies that do this is, pick a side.  

He doesn’t shy away from controversies

If there is an entrepreneur who wasn’t afraid to stick out like a sour thumb in his industry, that entrepreneur was Steve Jobs. Up till today, his company, Apple is well known for being unique in every possible way, From product designs to software. When you see an Apple product, you know it. 

Elon Musk is treading a similar path. As I mentioned before, Musk is not afraid to have an opinion that is contrary to everyone else’s. This is one reason why he often finds himself at the center of controversies. But his strong personality is also seen in his approach to product design. 

I will use the Tesla fart Horn sound as an example. Most companies will avoid doing such a thing perhaps because it is not appropriate or whatever their reason may be. But being too formal in your products could make them mainstream and boring. Customers are looking for something exciting and unique. Something with a “cool” factor. 

Another one of Elon Musk’s unique designs is the Tesla CyberTruck. It looks like something from a Sci-fi movie. Social media blew up with pictures of Tesla’s Cybertruck being shared across several platforms. If he can achieve this level of hype before the product is even available, imagine what will happen when customers get a hold of the truck.

Conclusion

Elon Musk has revolutionized the automobile and space industry, but aside from building a tech empire, he has also proven to be a marketing genius. In this article, I have shared four insights into why I believe Elon Musk was able to build a company with a strong reputation in the market, without spending a dime in advertisement. 

His tool of choice is social media and guess what? It is available for free. All you need to do is learn how to use it as effectively as Musk did. And you don’t have to do it the way he does. You can figure out what works for you and your company and then apply that.

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