Market Audit and Competitive Market Analysis of Tesla in Puerto Rico, Free Essay in Marketing

Published: 2022-04-20 23:22:22
Market Audit and Competitive Market Analysis of Tesla in Puerto Rico, Free Essay in Marketing
Type of paper:  Term paper
Categories: Marketing Tesla
Pages: 4
Wordcount: 1065 words
9 min read
143 views

Tesla Inc. is an American based company that specializes in the manufacture of automobiles, solar panel manufacture as well as energy storage. Among other products are the Tesla power wall and power pack batteries.

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Hurricane Maria a category four storm that hit the island has since left Puerto Rico in constant electricity shortage problems. It is this crisis of electricity in the island that has marked a beginning for the search of alternative and reliable energy solutions. Tesla has therefore initiated its plans to restore power in Puerto Rico through exportation of their power wall batteries and power packs to build micro grids (Mangram, 292).

Relative advantage analyses the degree to which a consumer sees an attribute of a certain new product or service as useful as opposed to the initial product. However, this preconception is an individual judgment which may not necessarily reflect the overall opinion of the entire segment of consumers. Relative advantage will directly affect the rate at which a new product is adopted and assimilated into the market. A product with a Positive relative advantage it is most likely to get adopted by the market consumers with much more ease. The battery supply chain built by Tesla gives the company competitive advantage. Thanks to the Panasonic cells and the continued improvement of the battery packages Tesla enjoys a relative advantage as opposed to other manufacturing companies that are charged with making EV batteries. Additionally, Tesla batteries are said to be relatively cheaper which makes them more affordable thus giving Tesla the largest market share (Nykvist, 329). The lithium-ion batteries are designed to tap and store energy which can be used when the sun is out. This is a very crucial project to the Caribbean island that was struck by the hurricane rendering it powerless. Tesla is also known to over a long period improve the quality of the storage packs and the batteries chemistry which has succeeded in placing the company at a strategically competitive place in the market.

The second source of competitive advantage for Tesla is its ability to setup a supercharger network. Based on the ability to understand consumer needs the company has been able to set up a fast charging station for electric car consumers (Bulman, 126). Tesla also has the pricing system rolled into the cars instead of the initial penny-counting pricing system which allows the drivers to supercharge freely. Both of these products are distinctly relevant to the Caribbean island at the moment considering its prevailing electrical crisis hence they stand sure chances of getting adopted in the new market.

Product compatibility is the extent to which a product fits into the individual's lifestyle choices. For instance, how closely the product or service is designed to match the consumer's needs, beliefs, wants, budget limits, as well as consumption patterns. Power batteries are very efficient, affordable, and easy to install. Tesla has further introduced compatible inverters from SMA manufactures. All these modifications are aimed at improving the installation procedures for the consumers. Power packs provide the users a series of applications across the grid. These include power storage, reliability, and power efficiency. The power pack is integrated systems with all the necessary components to get a utility connected. Unlike the traditional standalone batteries, with the power pack energy storage system installation among other benefits are available. All these puts together are likely to improve the market competitiveness of Tesla as a company. Scaling back on the production cost is also aimed at minimizing the overall manufacturing costs which translate to increased net profits. These products are not only simple to install but are also compatible with the consumers' needs which are specifically needed for clean and reliable energy solutions.

Innovation complexity relates to the ease of utilization. If innovation is too complex for the consumer to utilize it is likely to face very minimal adoption, however, if a product or service is deemed less complex it is easier to utilize more people will adopt it making it more competitive. The marketer can take advantage of this to control a huge market share. In the event of Tesla, the power wall batteries are essentially easier to use hence a higher likelihood of getting assimilated into the market (Kanagal, 16).

Product trial ability is a tool for boosting the consumer's confidence in the product or service. Trial ability minimizes the perceived risk of purchasing a default product therefore if a product can be easily tried out in the market by consumers before actual purchases the adoption levels of such a product are high.

Innovation is said to be observable if the consumers are in a position to sense all the potential benefits of such a product. For example, in the case of Tesla power wall batteries in Puerto Rico consumers are likely to appreciate the availability of the product as it fills in the gap created by the electrical crisis. The referent product is very relevant for Puerto Rico residents as it gives them the benefit of a more reliable yet still affordable source of energy.

Some of the challenges that Tesla is likely to face in market penetration relate to its existing pitiful amounts of cash as opposed to other automobile giants in the market. Due to insufficient funds, the emerging giant might lose its market capitalization (Karamitsios, 24). Due to insufficient funds, Tesla might be forced to raise more capital through debt which further leaves the company in a vulnerable position. Another challenge faced by Tesla is the decision to have a charging system rolled into the individual tesla made automobiles which are a decision that is facing some degree of resistance from a portion the consumers.

However, if the company can take advantage of the uniqueness of some of its project such the supercharging networks, it stands better chances of retaining its market relevance.

Works Cited

Nykvist, Bjorn, And Mans Nilsson. "Rapidly Falling Costs of Battery Packs for Electric Vehicles." Nature Climate Change 5.4 (2015): 329.

Mangram, Myles Edwin. "The Globalization of Tesla Motors: A Strategic Marketing Plan Analysis." Journal of Strategic Marketing 20.4 (2012): 289-312.

Kanagal, Nagasimha Balakrishna. "Innovation and Product Innovation in Marketing Strategy." Journal of Management and Marketing Research 18 (2015): 1-25.

Karamitsios, Achilles. "Open Innovation in Evs: A Case Study of Tesla Motors." (2013).

Bulman, Phil. "Tesla's Power wall Battery Production Requires 'Super-Charged'supply Chain." Renewable Energy Focus 16.5-6 (2015): 126-127.

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