The Reasons Behind Tesla’s High Net Promoter Score
Tesla has also claimed the top spot in 2016 Consumer Reports’ annual owner satisfaction survey, where 91% of Tesla owners stated that they would buy another Tesla vehicle in the future.
Total pre-orders for Tesla Model 3 surpassed many expectations at more than a quarter of a million in less than three days. To show you the bigger picture, this is more than 70 percent of annual sales for the leader in this market segment – Mercedes Benz C-Class.
You cannot argue with the fact that these results are incredible. Tesla is a definite leader in NPS® benchmarks, taking into account that anything above 40 is still considered a very good score, in auto-industry.
This huge success can actually show us the big picture of how markets work. So how does the world’s NPS leader achieve such a high level of customer satisfaction?
From implementing innovative features to perfecting customer experience, today we’ll share the secret ingredients that make Tesla so special.
Tesla developed a truly unique selling proposition
A lot of economic textbooks teach you about the role of competition in the market. But they are often skeptical of the free market, concluding that some industries associated with huge entry costs, alter the competitive process from its usual path.
The automotive industry is often cited as a good example of this. The need for huge investments and big exit fees work as a huge barrier to entry.
And then comes Elon Musk with the Tesla team, creating something different, something we were thinking couldn’t happen – an automotive startup company.
Just like Steve Jobs, Elon Musk then told a story that was aspirational and resonated with people. He said that electric cars are the future of sustainable transportation. In his blog post, he wrote:
“So, in short, the master plan is:
- Build a sport car
- Use that money to build an affordable car
- Use that money to build an even more affordable car
- While doing above, also provide zero emission electric power generation options”
The company had a vision and a long-term goal from the start. They were going to create an electric car that is fast, sexy and efficient, then use that capital to create even more desirable things, and people liked that.
A good product that appeals to the consumer is the deepest core of marketing, a thing that’s very hard to achieve. The best way to show value is to start by make something incredibly valuable to a significant market, just like Tesla did it.
Tesla brings innovation
When you drive a Tesla, your conception of what a car should be is irrevocably shaken. It t gives you the feeling like you’ve got a taste of the future. And it’s not just that they are electric, there are lots of other reasons why Tesla is innovative:
- Direct sales with no dealer network. Tesla allows customers to buy a car on the Internet, and this B2C model saves a lot of time and money by skipping the middleman. It reduces distribution costs and provides customers with greater convenience.
- Sporty — yet very practical — vehicle. Tesla cars have the character and design of a sports car, but at the same time reach out the level of practicality that has never been achieved before. It discovered a way how to bring a very powerful battery pack to a car market at an affordable price point (for the luxury cars market).
- Battery charging. Going back to the fact it’s an electric car, means that you can plug it in and charge it anywhere. You can plug it into a simple outlet or find a Tesla charging station that will charge it even faster, in about 30 minutes. There are 805 Supercharger stations for now, but Tesla’s interactive map illustrates its plan to expand them over the next couple of years.
- A smartphone can be used to interact with the car. You can see where your car is parked or how much longer it will be until the battery is charged, directly in the mobile application. You can also honk the horn, flash the lights and turn on the air conditioning before returning to the car.
- Remarkably safe. Tesla Model S was awarded a 5.4-star safety rating from the National Highway Safety Administration, the highest safety rating awarded to any car. It doesn’t have an engine, so the entire front end of the car becomes a crumple zone to absorb a high-speed impact. The roof of it is so strong that it broke a machine intended to crush the car.
If your company plans to take over the future this is the way to do it. This car feels like the future for more reasons than just being all-electric.
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Tesla cultivates brand loyalty
Tesla doesn’t have a huge marketing budget, unlike car manufacturers such as Ford and General Motors. Instead, Tesla relies on its brand advocates and word-of-mouth marketing for selling its cars.
Hundreds of Tesla fans line up outside dealerships before the cars are even officially unveiled and they even have to wait a few years before getting their dream car. These incredible pre-order numbers get Tesla even more attention. So, I researched how exactly Tesla builds such an incredible customer loyalty and here’s what I found:
1. Establishes an emotional connection with the customer
Tesla fans are crazy advocates. They attach a deep emotional connection to the brand. One of the easiest ways for a company to do this is by standing for something important.
In fact, a study by marketing research firm CEB published by the Harvard Business Review found that loyalty to brands is hard to achieve without one key element – shared values. People become loyal when they share the same vision and beliefs which that company represents.
Tesla passionately promotes its vision that the adoption of electric vehicles will one day solve our planet’s energy problem. As a result, people feel good about driving a Tesla. They don’t need to buy gas, AND they’re helping the environment.
This sort of advertising is earned, not bought.
2. Delivers one of the best customer experience in the auto industry
Tesla has come to a realization that gave them a huge competitive advantage in the world of customer experience: make the process of owning one better than that of owning any other car.
As Tesla’s VP of Sales, Cristiano Carlutti, puts it:
“In the other companies, customers are customers, basically. They pay, they get a product or a service. In the case of Tesla, the customers are partners.”
The process of owning a car includes many touch points, from choosing a car to providing regular service and maintenance to keep it running.
And while many automotive companies provide great products, Tesla is going above and beyond in order to create a complete user experience.
Their whole buying and maintaining process is very personal and in some cases unique to the car market:
- After you place your order you have one week to modify it before the Tesla factory begins to work on it.
- Then the car will be delivered to you or you could pick it up at the factory and at the same time get a free tour of the factory.
- If the issue is related to its software, engineers can often update the car at a distance. So, they can work on it during the night and have it ready to go the next morning
These are just some of the ways Tesla makes their customers feel special. Tesla goes beyond offering a great product, they are changing the way auto-industry perceives customer experience to the better.
3. Takes customer feedback seriously
I personally never owned a Tesla before, but I did a test drive of Tesla Model S once. The next day I received an email from them asking me to complete their customer satisfaction survey. I took some time to write it because I knew someone on the other end will actually listen to what I have to say.
Tesla has been known to respond to customers’ feedback and actually implement their ideas. A great example of that occurred when two Tesla drivers submitted an open letter to Musk via a full-page ad in a Palo Alto newspaper. They asked Tesla to make a few changes to its Model S.
In response to this customer feedback, Musk tweeted a photo of the open letter saying that Tesla would indeed implement some of the suggested changes.
There was another instance when a Tesla owner complained about fellow consumers hogging spots at a local charging station, Musk reacted immediately.
Six days later, Tesla announced the following policy on its official website:
“We designed the Supercharger network to enable a seamless, enjoyable road trip experience. Therefore, we understand that it can be frustrating to arrive at a station only to discover fully charged Tesla cars occupying all the spots. To create a better experience for all owners, we’re introducing a fleet-wide idle fee that aims to increase Supercharger availability.”
It’s no wonder why Tesla has such a high NPS. From efficiently communicating its brand vision with people to publicly addressing customer issues and delivering their promises, Tesla truly knows how to build brand loyalty.
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Now that you are inspired and motivated by Tesla’s staggering success, it’s time you start implementing their strategies into your company.
Retently NPS helps you build that special connection with the customer, by providing you the tools to effectively communicate with them and gather valuable feedback.
Boost your customer satisfaction and improve retention rate by sending an automated Net Promoter Score survey to your customers. Identify who in your company is on the edge of churning or who loves your company so much, that if given the resources will act as a brand advocate.
Start your NPS campaign today, to improve your customer satisfaction tomorrow.
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