Tesla halted its referral program in February 2019. Indeed, due to popular demand, the company announced the re-introduction of its very successful referral program with all new incentives. Indeed, since the launch of the company, they have committed to operating with a marketing budget of $ 0. No advertising, no advertising agency, no marketing manager and no dealer network. From then on, the company has since exploded, worth an estimated US $ 208 billion and having generated revenue of $ 24.6 billion in 2019. How did they achieve this? Let’s find out why the program was so successful and how it helped Tesla achieve the notoriety they have today.
What did the old program look like?
The old program implemented a large referral reward as well as a friend offer of $ 1,000 credit. In fact, a credit of $ 1,000 was to be given to Tesla owners whose references result in the purchase of an electric Model S sedan. The friend who would make the purchase will also get $ 1,000 off the vehicle. price. Although this is a modest incentive. Prices for Tesla cars range from around $ 70,000 to over $ 100,000. However, we note the beauty of the references. It’s not so much about making a huge drop in price, but being able to give your friends $ 1,000 off. It’s a nice gesture, much nicer than buying them a coffee or a dinner.
And there are additional status incentives as well:
- Special Edition Products: People who complete 10 referrals will be entitled to purchase a special Founding Series Model X that they personally inspect.
- Exclusive Events: Additionally, those who make five recommendations will receive an invitation for them and a guest to attend the Gigafactory Grand Opening Night.
What does the new program look like?
The new Telsa Referral Program rewards both the referrer and the referred friend with 1,500 kilometers of free supercharging with the purchase of a new Model S, Model X or Model 3. Is this a surprise? Not at all: Tesla CEO Elon Musk was a pioneer in referral marketing at PayPal. Indeed, as soon as PayPal saw that the so-called early users were using the system by the thousands to pay for their eBay purchases, Musk set up a viral marketing campaign. The company paid $ 10 to each new PayPal customer as well as anyone who referred a new user to the system. The campaign fueled exponential growth.
- Many people are eager to participate in the “Tesla movement”.
Tesla fans have been made aware of the referral email. Tesla is one of the few companies that can legitimately call itself a cutting edge, with its Gigafactories, Powerwalls and other innovations. People who buy Teslas are not just buying a better car, they are buying early adopters status, they are joining a movement. These are all things that influence referrals.
- Tesla has a great Underdog vs The System story going for them that fans want to be a part of.
At Tesla’s 2013 shareholders meeting, CEO Elon Musk choked on his belief that the dealer system in the United States today is counterproductive, restricting entrepreneurs and giving less choice to consumers. One of the benefits of online sales generated by social referrals is that they could improve sales to consumers in states where Tesla cannot legally operate stores due to dealer franchise laws.