Tesla’s tipping point … the clever strategy to drive electric cars to exponential growth

Tesla's CEO Elon Musk unveiled the highly anticipated Tesla Model 3 electric car on Thursday night in a converted LA aircraft hangar. Tesla's launch events have become a little like Apple's big moments used to be. Electrifying, a pioneering spirit, packed with hard core fans. Musk is much more improvised than the word perfect Jobs, stuttering with nerves that show he is human despite his vision and celebrity. The Model 3 has the potential to become the tipping point from carbon to carbon-free motoring, and to drive exponential growth for Tesla, and the electric car market. 275,000 preorders worth $9.6bn in 3 days, and almost two years ahead of delivery, demonstrates the consumer response.

In the Gamechangers project we explore in detail how Tesla has developed a long-term market-shaping strategy to change the game of car travel. The cars themselves, beautiful and technically wonderful, are not even the heart of the story. Nor is the innovative retail model, selling direct in upmarket shopping malls, customised on the iPad, cash in advance. Most significant is the overall business model - designed to shape the market through the world's leading charging network - the Supercharger network, which is included as an ongoing subscription in the retail price, for Tesla and other brand cars. Supercharger is driven by another of Musk's businesses, Solar City. By giving away much technical IP, Tesla is creating an industry standard in its own vision, on its own terms. Tesla is "changing the game" of motoring in front of our eyes.

The Model 3 is the third major car in Tesla’s fleet. The Model S, a luxury sedan, was launched in 2012, while the Model X, an SUV/people carrier crossover, was launched last year. (Musk likes to point out how the model numbers of the three cars will eventually spell out the word “S3X”).

Starting from the expensive and niche roadster, he has positioned the brand as innovative and aspirational, to compare with a Porsche or even Ferrari. Now he is moving down the price ladder to the wider market - to compete alongside the BMW and Audi-type brands, but with more magic, and sustainable credentials. He even thanked early adopters, those who had bought the early models at premium prices, saying that the profits he made through them has allowed him to build this new car for everyone (well at lot more people).

There are strong echoes of Apple's  strategy for iPods and iPhones here too. Combine this product launch schedule, with the roll out of the Supercharger Network (iTunes was the real genius of iPod, App Store of iPhone), and the associated hero-worship of the brand by a fanatical fanbase, and you have a winning model for reinventing the market, driven by vision and desire. 

Tesla's mass market Model 3  was driven onto a foggy stage in an extravagant unveiling, where Musk revealed that the Tesla Model 3 will seat five, and be able to cover at least 215 miles on one charge.   Musk said the standard Model 3 would be capable of zero to 60 miles per hour in less than 6 seconds, and will cost $35,000, which is half that of the company's current flagship cars, the Model S sedan and Model X crossover. The new car actually looks like a more sporty version of the company's Model S. The Model 3 will also feature Autopilot for assisted driving and be future-proof for self-driving road use. Deliveries begin in late 2017, by which time Tesla says it will have doubled the number of charging stations worldwide and will include charging for free.

The Model 3 is Tesla's attempt to bring electric cars to the mass market and is considered critical to the company's future success.  Interest has been strong, with preorders for the Model 3 at Tesla stores and galleries – some of which are located directly adjacent to Apple retail stores (where the launch of the iPhone SE no longer commands the long queues of old). Musk later boasted on stage that the company had already secured 115,000 reservations before the car had even been revealed (a figure that has more than doubled in the last few days). Tesla's stock price rocketed too.

You can watch the full unveiling of the Tesla Model 3 here: 

Read more about Tesla and how it is changing the game.

Peter Fisk is a global thought leader on business leadership, innovation and marketing. He is a bestselling author, inspiring keynote speaker and expert consultant. He is founder and CEO of GeniusWorks, a brand and business innovation consulting firm, based in London. Having started in nuclear physics he went on to manage brands like Concorde, launch innovations with Virgin, work in sectors as diverse as banking and cosmetics, food and pharma, telecoms and travel, and lead a global education business. He is also a Professor of Strategy, Innovation and Marketing at IE Business School in Madrid, Europe’s top ranked educator, and was recently included in the prestigious “Thinkers 50 Guru Radar” as one of the best new business thinkers. Read more at www.theGeniusWorks.com

His new book “Gamechangers: Creating Innovative Strategies for Business and Brands” explores the world’s 100 most disruptive innovators, and then interprets 10 themes for success in today’s business world. From enlightended vision to finding new markets, bolder brands and innovative business models, new customer agendas and enabling experiences, realtime marketing and social movements, inspiring leadership to deliver more profitable growth. It also includes 16 practical canvases for applying the best ideas to your own business. Explore more about the book at www.Gamechangers.pro

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