cliff edged

Tesla Takes Auto Business to the Edge.

I have to tell you, my initial response to discovering a Tesla store in a NJ mall was a phone call to NJCar President Jim Appleton. I wasn’t more than four paces outside the store before leaving my message, “WTF is going on here”? His response concluded only recently with action to protect the franchise and investment rights of NJ auto dealers.

Tesla’s CEO Elon Musk wrote a fervent response to the NJ legal action against his nontraditional method of selling cars.  Putting the passionate response aside, Mr. Musk detailed his business strategy for selling electric vehicles in a new way, rather than the 100 year old heritage of gasoline vehicles and franchises. Summarizing, he chose to take responsibility for his success by avoiding conflicting interests that could frame his failure.

Relax Elon!

I revisited the store on a weekday and had a very pleasant customer experience. Absent was the chaos of the weekend crowd inside and outside the store.  I spent close to two hours with an enthusiastic and informative product specialist that concluded in configuring a vehicle and two test drives to compare suspensions. The time and information your product specialist provided was invaluable in distinguishing the success of your sales method.  Needless to say, whether you call the place you park a Tesla a showroom, a store, an auto show, or a gallery, you have proven that selling automobiles can be done over the internet. I came, I saw, I configured, I drove, and now my MOTORTREND Car of the Year is waiting online for my credit card approval, followed by delivery to my driveway. Wow, how simple!  No pressure of negotiating with a commissioned salesperson, no back and forth among management, no one asked me to return with my husband. No blablabla, no interpersonal strife, no negatives, it reminds me of my best closing line, “You like it? You want it? OK then.”

Tesla has brought selling cars to the edge.  Positive comments and support for Tesla’s indicate how the legacy franchise system has failed the consumer.  I suggest Mr. Musk fire the attorneys embattling franchise laws and let the politicians fight for their dwindling tax base. Invest your savings in engineering a sophisticated car that attracts more buyers. Furthermore, spare a moment to take your Apple selling model to the next level of ecommerce and social business. Even the Apple model will eventually be replaced with a Tesla ecommerce model of direct online sales as mobile technology reaches parity, and rent and labor expenses erode corporate profits. Plus, with no genius apparent, the mall’s Apple store looked like a crew of sales people waiting for the next up bus.

Although I have hope for my friends in Detroit and my dealership friends in the field, neither is good playing the long game nor playing nice together.  The legacy manufacturers and dealers are moving slowly to understand how to compete in a rapidly changing consumer retail environment. A webFlutter social media strategy strengthens the value chain in a brick and mortar retail environment and the dealer network becomes key to target marketing.  Still, it is less likely change for the legacy system will happen, either quickly or effectively, given the strained relationship among parties. The ultimate question at the edge is who has the golden parachute? Who will fall off the edge and who will soar ahead?

Share & Flutter with me, Your Automotive Social Butterfly, MJ

2 thoughts on “Tesla Takes Auto Business to the Edge.”

  1. When you bought your other cars didn’t you ask for or negotiate a discount? I’m sure you didn’t pay full price. You probably would experience the same sales experience if you were willing to pay full list price for any other car.

    1. Thank you for your comment. I did ask for a discount and was told it was one price selling. Do you think that is not true of Tesla? Was I snookered?
      Secondly, are you saying the industry would have a better reputation and offer a different customer experience for consumers who paid full price for products? Will internet buying cease if merchants wake up on the right side of the bed and stopped negotiating price or offering the gotta have deal? For better or worse, we pay the posted price for everything we buy in retail stores these days. Although the internet offers convenience, brick and mortar offers convenience too. Who started all this negotiating anyway?

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