Elon Musk is changing the nature of transportation both on earth and in the cosmos. His aerospace manufacturing and space transportation company, SpaceX, ferries supplies and soon astronauts (and maybe even private passengers) into Earth’s orbit. Back home where gravity is king, his motor vehicle company, Tesla, has transformed fully electric cars from novelty items for idealistic environmentalists into a luxury vehicle with power and handling that rival any high-end gas-guzzler.
The strongest evidence of Musk’s genius, however, might be found not in his batteries or rockets, but in his branding.
Musk has made Tesla a household name and a Wall Street darling with a marketing budget of exactly zero dollars and, as marketing industry publication Ad Age put it, “no advertising, no ad agency, no CMO, no dealer network.” Although his brand recognition wasn’t purchased, it was certainly earned. Musk has gambled on bold and innovative marketing strategies that most people don’t even recognize as advertising or branding campaigns.
Those strategies have proven to work, and not only for Musk’s space-age cars and space-bound rockets. Hot tub manufacturers and retailers are also successfully employing some of Musk’s best marketing ideas — regardless of whether they realize it.
The Traditional Showroom, Reimagined
Michigan is one of eight states that allows only franchised dealerships to sell cars, yet Tesla wanted to open up shop in a suburb of Detroit. The company’s strategy for getting around those laws would go on to become one of its defining marketing moments.
Since Tesla couldn’t sell cars directly, it began putting them on display in high-end malls and even inside of stores: The Detroit gallery is inside a Nordstrom. There, a shopping mall’s worth of daily foot traffic meets Tesla inside a bright, high-tech and neatly decorated gallery where just a single Tesla is on display. Although they can’t make a purchase, visitors can ask questions, learn about the brand and imagine themselves in a Tesla without ever encountering a high-pressure salesperson.
This in-store gallery model, it turns out, is perfect for another big-ticket item: hot tubs.
“In a mall atmosphere, you wouldn’t expect people to be shopping for hot tubs,” says Ryan Sessler, vice president of sales at Jacuzzi Group Worldwide. “Tesla didn’t think that either, but look at them now.”
In 2018, Jacuzzi teamed with one of its most prominent dealers, Seattle-based Aqua Quip, to open its own Tesla-style gallery at Southcenter Mall in downtown Seattle, which hosts about 1 million customers per month.
“What we were looking for was how to do things a little bit outside the box from a traditional retail setting,” Sessler says. “Like most dealers, Aqua Quip has traditional showrooms, but what can we do to drive more traffic?”
The two companies partnered to strip out a Claire’s jewelry store and convert it into a miniature Jacuzzi meet-and-greet showroom hosted by Aqua Quip.
“We thought we’d do a test in a mall with big branding and big exposure, and set up a store that was very high-end looking,” Sessler says.
Jacuzzi put up the resources to build out the space with flooring, lighting, decor, artwork, branding, signs, logos, banners and images. Aqua-Quip staffed the gallery, which displayed three or four Jacuzzi hot tubs.
They did make a few sales and Aqua Quip even hired an additional employee, but the experiment was always about branding and the exploration of alternative marketing strategies.
“It piques people’s interest and gets them to go do more research,” Sessler says. “A customer comes in and sees the tubs, and a rep is there to greet them.”
As with Tesla’s car galleries, the idea was to plant a seed in window shoppers who displayed customer potential. “The point was to get information from them to try to turn them into leads and drive them into an Aqua Quip location,” Sessler says.
Both Jacuzzi and Aqua Quip learned a lot along the way.
“If we were to do it again, we would make sure the mall promoted us and put us on their maps,” says Scott Johnson, director of marketing for Aqua Quip. “Only about 25 to 35 percent of mall visitors are ever going to walk past your location. We found it difficult to inform everyone that we were there. So next time, we would be more visible with an aisle display and directions to our store. We would negotiate differently with the mall. We sold some and got a lot of people interested, but we believe there was a lot of opportunity that we didn’t take advantage of.”
They also would have liked to use social media tagging and geofencing to ping the mobile devices of distracted mall shoppers strolling past. “Most people walking in a mall have their heads down looking at their phones,” Johnson says.
Although they used a tablet to record as much customer data as possible, it proved difficult to attribute any future business to interactions at the gallery. “If someone came through the mall showroom and didn’t fill out a lead form but later went into Aqua Quip and made a purchase because of it, we don’t know that,” Sessler says.
Both Sessler and Johnson feel good about the experiment, whether or not it led to increased sales. “Either way, lots of eyes on the product,” Sessler says.
Let Your Strengths Define Your Brand
Tesla has done so well, in part, by positioning itself not as a car company, but as a battery company. Since limited battery power and short charge life has plagued so many automakers entering the electric car space, Tesla’s relentless focus on its advanced batteries separated the company from the pack while also highlighting the weakness of its competitors.
Jody Gamracy of Canada’s Blue Falls Manufacturing, the company that makes Arctic Spas, has found success using a version of the same strategy.
The company’s exclusive SpaBoy technology solves a problem that plagues many spa owners. The chlorine generator automatically monitors and regulates water quality without any testing or application required from the user.
“There are lots of chlorine generators out there,” Gamracy says, “but I haven’t seen any with sensors that detect the chlorine level and that then turn the chlorine generator on and off depending on the set point of the sensor. You don’t have to go test your water with a test strip or drops. It tests it every few minutes.”
You can get a hot tub anywhere, so Arctic Spas used Spa Boy to bill itself as a company that’s in the clean, automated water business, just as Tesla promoted itself not as a car manufacturer, but as a leader in the battery industry.
The move has worked.
“It’s by far our most popular option,” Gamracy says of Spa Boy. “Our dealers tell us it’s the No. 1 thing that helps them edge out the competition.”
Highlight the Big Projects to Make the Regular Stuff Look Easy
In 2018, SpaceX wowed the world with the successful launch of a Falcon Heavy rocket. The rocket contained very special cargo, but not the supplies that NASA often contracts SpaceX to shuttle to the International Space Station. On board was Elon Musk’s personal Tesla Roadster, occupied by a dummy driver named Starman in astronaut gear. The Roadster, with Starman behind the wheel, now orbits Earth in perpetuity while blasting David Bowie.
Since anyone in the market for an electric car is likely not planning to drive into space, why was the stunt hailed as a stroke of marketing genius?
Because it put on display for all to see a level of technical, mechanical and strategic prowess that no other automaker could possibly match. If they can successfully build a rocket and use it to launch a vehicle into space, the logic goes, they can certainly knock together an electric car for my commute to work.
Robert Guarino, president of South Shore Gunite Pools & Spas in New England, knows a thing or two about using other-worldy projects to flex his company’s muscles, although his supersized builds take place here on Earth.
“It’s a shame that we have ‘pools’ in our name because we do an awful lot of different things,” Guarino says.
Among the projects featured prominently on Guarino’s Facebook page is a $700,000 music hall that South Shore was contracted to fill with shotcrete. Like Starman’s space mission does for Tesla cars, the music hall project makes building a gunite spa look like child’s play.
There’s also the projects Guarino has done at Brown University, WPI University, more than 60 YMCA’s in New England, as well as numerous municipal and school pools.
None of these big, important projects are anything the average New Englander wants in the backyard, so why put them on display? For the same reason Musk put so much publicity behind his Roadster space launch, a concept Guarino summed up neatly:
“It reinforces, both to prospective customers and employees, that we’re the real deal.”