This video is sponsored by Squarespace. Most companies depend on advertising to inform
persuade and remind consumers of their products and services. But not Tesla. You won't see any
Tesla ads anywhere. Not online. Not on the radio. And not on television where sometimes companies
can spend millions on just a single ad. Norway, coming for you. It's unclear how much General
Motors spent on this Super Bowl commercial but the going rate for a 30-second spot is $5 million.
In total, GM spent $2.7 billion in advertising and promotion in 2020 - that's actually down a billion
from the year before due to disruptions from COVID-19. Here's the advertising cost per vehicle sold
for the leading automakers. Genesis, part of the Hyundai Motor Company, dished out $2,000 per vehicle in 2019 whereas Tesla spent 14 cents, incurring costs from promotional
activities rather than traditional advertising. So why does Tesla not run ads? It doesn't have to
persuade anyone to buy its electric cars. Back in the day, Tesla couldn't keep up with demand. There
was no need for advertising. Thank you to everyone that ordered the car. We love you. Customers
had to wait years to get the car they ordered like the $35,000 Model 3, its most affordable model
yet. And when they did, a million people watched the handover on Tesla's YouTube channel. Its streamed
events frequently rake in millions of views. Oh my (expletive) Well, maybe that was a little too hard. The Cybertruck unveil where a steel ball
shattered the armored glass also apparently helped smash sales. Oh man. CEO Elon Musk suggested the company had received 250,000 orders of the electric pickup less than a week later. All without having to pay for advertising. Still, even events fail to fully explain why Tesla doesn't advertise. Musk has gone on the record to say he'd rather use that money to make the product great. Tesla's research
and development budget has been increasing drastically over the years while GM's has been
steady and recently dropped slightly in 2020. It still spends considerably more than Tesla - it
does own several car brands. However, Musk's company is closing the gap. The thinking behind Tesla's
focus on design, engineering, and testing is that if you build the best car, the product will speak
for itself or have others speak for it free of charge. Celebrities and influencers have showered
plenty of affection on the company. Jaden Smith showed off his pink Model X in a music video. Kanye
West has made no secret of his Tesla love affair. YouTuber ZHC surprised Mr Beast with a custom
designed Tesla. Not to mention, Tesla also receives an abundance of free promotion from Musk's other
company SpaceX. Model X's carried NASA astronauts to the launch pad for flights aboard Falcon 9
while the Falcon Heavy launched a Tesla roadster on a path to Mars. That event generated a flood of
media attention but the relationship between Musk and the traditional news media hasn't always been
so rosy to put it lightly. He's criticized media coverage. For example, about a deadly crash of a
Model X on autopilot mode or production delays involving the Model 3. Musk suggested journalists
write negative stories in order to get maximum clicks and because gas and diesel car companies
advertise with these news organizations while Tesla does not - inferring big oil plays
a role behind critical coverage of Tesla which reporters have denied. You might think Tesla would
respond with a slick public relations campaign but actually, Tesla got rid of its PR team in
North America although it still has one in Europe. While most companies use their PR departments
to communicate information to journalists, Tesla appears to be cutting out the journalists
in favor of communicating directly with the public via social media. Musk's belief in the power of
social media is so strong that he once hired a meme maker as Tesla's social media manager. Adam
Koszary had a sheep to thank for the job. He caught Musk's attention after tweeting out a photo of
this absolute unit when he worked at a British museum. It went viral and for some reason, Musk
ended up changing his profile picture to that of the big fluffy fella which generated even more
chatter online. His 50 million follower count on Twitter is far greater than that of the leading
automotive companies combined. He often replies to people asking for help like the time singer Sheryl
Crowe got stuck in a parking lot with a dark Tesla display. It's not just the rich and famous
who have his attention. Musk routinely answers questions from the general public. In many ways,
he himself is a walking advertisement for Tesla though occasionally it's gotten him into trouble.
The U.S. Securities and Exchange Commission sued Musk for fraud when he tweeted he
was considering taking Tesla private at $420 a share - a reference to marijuana. And that
funding had been secured. Controversial or not, Musk puts his companies in the spotlight without the
need to pay for it. It should be noted that some other companies have employed the same strategy.
Starbucks relied on word of mouth to grow. Costco doesn't pay for advertising. Neither does Krispy Kreme. So, Tesla is far from the only brand that doesn't rely on paid advertising. It does, however, rely on its website for sales. You don't need to run a company or be a business to realize the importance of having a website. It's great for starting a blog or showing off your work. That's what I did as
a journalist years before Squarespace became my sponsor. And it helped me land a lot of reporting
jobs. Squarespace is super easy to use. You don't need any experience in website building whatsoever.
There are many beautiful templates to choose from. You can try it out for free for a couple of weeks by
heading to squarespace.com/newsthink. The link is in my description. And when you're ready to launch
use my discount code: NEWSTHINK to save 10% of your first purchase of a website or a domain. Thanks
for watching. For Newsthink, I'm Cindy Pom.
