Digital Business, Marketing, and E-Commerce
Abstract
The emergence of new technologies in the recent past have led to significant transformations in society. The internet phenomenon has also led to the rise of internet-based organizations that use digital technologies to market their products. Tesla’s media coverage involves a digital communication strategy whereby the company utilizes social media platforms like Twitter. Instead of paying influencers, Musk has focused on building his account in order to promote the brand of Tesla. This paper begins with an introduction section which provides a brief background of Tesla and how it uses social media. The next section is the body that discusses digital technology frameworks, the application of e-commerce and digital marketing in Tesla, and the opportunities and challenges of using social media marketing. The paper provides recommendations on how Tesla could improve its social media marketing, and it concludes with a conclusion that summarizes the main points of the essay.
Introduction
Founded in 2003, Tesla Inc. is an American electric vehicle manufacturing company. Tesla designs manufacture and sell technologically advanced and fully electric cars as well as energy storage systems. In the automotive segment, electric cars are developed, manufactured, and sold. Conversely, the energy generation and storage segment focus on designing, manufacturing, and selling or installing energy storage and solar energy systems for commercial and residential customers. Don't use plagiarised sources.Get your custom essay just from $11/page
Theories and Models of Digital Businesses
According to Taylor (2016), the emergence of new technologies in the recent past have led to significant transformations in society. The current narrative around technology as the key factor towards global business success has largely transformed the concept of digital business. The automation of the industrial process, like the automation of Tesla’s manufacturing processes, has developed the digital value chain that enhances communication between the organization and the customers. Digital technologies, as mentioned by Shen, have redefined how businesses operate today. Various conceptual and theoretical frameworks of digital business exist. These are frameworks that aim at enhancing an organization’s value creation capabilities, create competitive differentiation, and improve the quality of products and services customers receive (Chaffey & Ellis-Chadwick, 2019).
Digital Reinvention Framework
Suggested by Berman et al. (2016), this is a framework that is built on the argument that in order to achieve a successful digital reinvention, companies must pursue new strategic focuses, develop new capabilities, and design new ways of working. Berman argues that for traditional organizations to achieve successful digital reinvention, they must conduct a bottom-up reinvention of their strategies, technology, and operations. This framework suggests that for businesses to be transformed digitally, they must experience first. This means that they must adopt digital technologies like the use of e-commerce marketing in order to build on the three priorities of focus, expertise, and ways of working.
Digital Transformation Framework
This is a framework for digital business that was proposed by Elkhuizen and Corver in 2014. According to Shen et al. (2019), the framework is built of four main items, which are the organization, customers, products, and systems and processes. The argument of Elkhuizen and Corver was that the digital transformation of a business begins with the customers. An organization should begin with knowing the customers’ needs and demands. After a critical understanding of the customers, the organization may then go ahead and digitalized service delivery before going ahead to digitalize products, operation, and systems. Every organization, including Tesla, should focus on the demands of the customers before aiming to digitalize products and services.
Digitization Piano Digital Business Transformation Framework
This framework was proposed by Michael Wade in 2015. In fact, it was published by the Global Center for Digital Business Transformation in the same year. According to this framework, the digital transformation of a business must lead to organizational change. In digital business, organizational change should lead to the adoption of digital technologies such as the use of social media. This means that this digital framework much affects the processes of an organization, its structure, information technology capabilities, and operations of the company (Chaffey & Ellis-Chadwick, 2019).
The fundamental goal of every business is to develop a means by which it can outperform its competitors. In the digital era, competitiveness is achieved through creativity and innovation. With the increased use of the internet, Taylor (2016) concur that businesses must adopt digital technologies as a way of improving the efficiency of operations, quality of products and services as well as marketing. Tesla is an example of an organization that has utilized digital business theoretical frameworks, which have helped the company to transform towards automation. Digital business frameworks are important for the modern organization since they help businesses improve how they operate.
Application of E-Commerce and Marketing
The internet, as noted by Shen et al. (2019), has become an integral part of modern societies and organizations. The internet has led to the transformation of the business world, social interactions, governance, and communication. The advent of the internet saw businesses across the globe capture ideas and infuse technological innovations in the production of new products and marketing them to the customers. The internet phenomenon has also led to the rise of internet-based organizations, which are commonly known as online companies that operate purely online and involve minimal physical logistic systems.
Digital marketing, also known as e-commerce, is a concept that has gained increased attention in the last decade. E-commerce, as defined by Taylor (2016), refers to the process of selling goods and services over an electronic network by use of the internet (p.34). It is a process that involves the creation, communication, and delivery of value to customers, along with managing the relationship of the company with the organization. E-commerce is a marketing strategy that is designed to capitalize on the electronic capabilities of an organization in order to achieve the specified marketing objectives.
Use of Social Media Marketing by Tesla Inc.
When buying a car, most customers use digital technologies to research. The introduction of a social media platform like Twitter and Facebook has radically changed the online purchase habits of the customers and how businesses promote and advertise their products and services. The adoption of social media platforms in marketing has allowed companies, including Tesla, to communicate to the customers virtually by exchanging opinions and making purchases online without face to face interactions (Portes et al., 2020). For these reasons, social media acts as an important e-commerce and marketing tool for Tesla since it boosts the popularity of their products.
The media coverage of Tesla involves the use of the digital communication strategy by utilizing social media platforms like Twitter to market and promote their products. It is important to note that Tesla Inc. uses social media networks instead of using paid promotions in televisions and ads on YouTube. The use of social media has been a major driver towards saving marketing costs for Tesla. The company does not pay for promotions. It uses its social media channels to connect with current and potential customers directly.
Twitter is one of the commonly utilized platforms by Tesla. On Twitter, the company communicates the introduction of a new product together with the prices. This is important since it increases the awareness of the company’s products to its customers. Increased product awareness helps in enhancing brand awareness and increase customer loyalty (Portes et al., 2020). The use of social media by Tesla has proven to be successful in terms of making sales. For instance, in the first quarter of 2017, while Nissan made about 38000 sales in the total globe electric vehicle cars, Tesla made about 25,000 sales.
Many organizations partner with people who have strong social media platforms to promote their products. These are the influencers who have the ability to influence the buying decisions of customers. However, Tesla’s core influencer is the CEO, Elon Musk. When comparing with CEOs, the influence of Musk id evident since he has about 24 million followers on Twitter. Tesla’s own Twitter has about 3.2 million followers. Instead of paying influencers, Musk has focused on building his account in order to promote the brand of Tesla. This is a strategy that cuts costs and personalizes the company by sharing the vision of the company with the customers (Kumar & Singh, 2020). As a result, customers develop trust and are more comfortable with the brand.
Many brands rely on photoshoot themes and photos. In contrast, Tesla prefers to upload spontaneous content. The majority of their posts on Instagram and Twitter are videos and photos of the car in action. This is an approach that creates an authentic connection with followers and customers. According to Kumar and Singh, showing their cars in action is a way of demonstrating the functionality of their products but in an entertaining way. Tesla uses social media to build and engage with their community. Musk responds to the personal comments made by the customers on his social media network. As such, fans feel empowered by the company since the CEO, and founder of the company communicates with them personally. This is an overall benefit for the company since customers are informed of the vision and products of Tesla (Kumar & Singh, 2020).
The competitive advantage of Tesla is based on branding. The company’s brand is built on its reputation. Musk has a strong and personal community to engage with customers. Through Musk, Tesla keeps customers aware of their products, starting from manufacturing to marketing stages. While other companies use social media to post advertisements, Tesla creates awareness of their products by making frequent and regular updates (Portes et al., 2020). Transparency is something that improves the connection of the company with the customers.
Opportunities for Using E-Commerce and Digital Business Marketing
A key advantage of using digital marketing is that it enhances customer reach. With the use of social media, companies like Tesla reach a higher number of potential consumers of their products. Second, digital marketing enables direct advertising and creating awareness of products (Berman et al., 2016). Social media is an effective way to promote a brand because organizations communicate with their customers directly. In addition, social media helps in saving costs. This is because platforms like Twitter, as adopted by Tesla, are a cheaper source of advertising as compared to other marketing channels like radio and television.
Challenges of Using E-Commerce and Digital Business Marketing
One challenge of using digital marketing is that there is high competition from alternative brands. When companies offering the same products and services use social media as their marketing strategy, this conflicts the customers and provides an alternative to choose the company offering cheaper products. Since digital marketing is highly dependent on the internet, Taylor (2016) notes that companies find it difficult to extend their awareness to areas with poor internet connectivity.
Recommendations on how to Improve Tesla’s Use of Social Media Marketing
Even though relying on Muck’s Twitter channel to market Tesla’s products have been effective, investing in influencer marketing could help in improving the awareness of Tesla Inc. The use of influencer marketing will be effective in increasing the number of customers for the company since more people will be aware of the brand. Also, Tesla could use paid promotions and endorsements from its customers. The company could contract some of their customers with high social media platforms to promote and endorse the brand. As a result, Tesla will acquire a large number of customers.
Conclusion
Tesla, Inc. is an American electric vehicle manufacturing company. Tesla’s media coverage involves a digital communication strategy whereby the company utilizes social media platforms like Twitter and blogs instead of using paid promotions and television advertisements in order to reach customers and enhance brand awareness. Tesla’s core influencer is the CEO, Elon Musk. When comparing with CEOs, the influence of Musk id evident since he has about 24 million followers on Twitter. Tesla’s own Twitter has about 3.2 million followers. Musk responds to the personal comments made by the customers on his social media network. As such, fans feel empowered by the company since the CEO, and founder of the company communicates with them personally. A key advantage of using digital marketing is that it enhances customer reach. Social media is an effective way to promote a brand because organizations communicate with their customers directly. One challenge of using digital marketing is that there is high competition from alternative brands. It is recommended that Tesla should invest in influencer marketing to improve its social media marketing.
References
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