Some of the marketing best practices for high-end disruptor brands include using referral programs and marketing through a mission or vision statement. Tesla achieved its success by leveraging these marketing strategies.
Referral Programs & Word of Mouth Marketing
- Disruptor brands are advised to build a strong referral program as people tend to trust recommendations from friends and family than any form of advertising a brand uses.
- Almost 90% of US consumers “proactively seek referrals from peers before deciding whether to purchase a product.” At least seven in ten sales executive say referrals “close faster than other leads.”
- For a referral program to be successful, there needs to be a complete focus on providing a great quality experience and ensuring that the pre-purchase and post-purchase experience is nothing short of excellent. Crafting positive customer experiences makes it easier to encourage customers to recommend the brand or product to others.
- When designing a referral program, experts warn that it is best to not focus on discounts. Instead, a luxury brand should allow customers redeem points for products or experiences.
- Brands should also make it easy for a referral link to be shared across social media platforms and via email as more than 70% of US consumers are more likely to buy a product after getting a link to it via email or social media from family or friends.
- Although referral programs are also known as loyalty programs, using the latter name makes it sound too modest. It should be called a referral program as this is considered a more prestigious term for it. An example of a disruptor that utilizes referral programs is Tesla. The company’s vehicles and batteries are known to be reliable and exceptional.
- Tesla spends considerably less than competitors on marketing. The company is known for having a $0 marketing budget. Rather than relying on TV ads like most luxury auto makers do, Tesla turns on referrals and word of mouth advertising.
- The company does not directly market to new customers. Instead, it urges existing customers to do the advertising through its referral program and word of mouth, thus turning customers into its marketers.
- The referral program a luxury company offers should match the luxury status of the company. In 2015, Tesla’s referral program allowed customers to get $1,000 in credit towards a Tesla service, accessory, or vehicle when someone they refer gets a vehicle.
- One YouTuber referred viewers from his YouTube to Tesla. The company made over $10 million in sales from this referral. As a result, the YouTuber got two free Founder’s Series Next Gen Roadsters directly from Tesla.
- Referral programs help generate press coverage. Tesla changes its referral program frequently to keep things interesting. Its current referral program ensures that Tesla owners who refer people to the brand earn 1,000 miles of free Supercharging and a chance to win a “Model Y monthly or Roadster supercar quarterly.” The more Supercharging owners get, the higher their chances of winning either vehicle.
Market through Mission Statement
- Disruptor brands must have a strong mission statement that not only offers a clear insight into what the company is about, but also aligns well with the company’s target market.
- A mission or vision statement should be something the company wholeheartedly believes in and stands behind. It should be integrated in every marketing material the company releases.
- Over 70% of US consumers will rather buy brands that are in line with their values. Millennials particularly stress the importance of buying brands with similar values. Almost 70% of millennials and Gen Xers like it when the “CEOs of companies they buy from speak out on issues they care for.”
- Companies like Tesla fuse their mission into their marketing. Tesla has always been committed to its mission of developing transportation mediums that are environmentally sustainable. The company ensures that this mission is communicated across its social media platforms and its website.
- Tesla’s website is furnished with content related to sustainable energy. The company documents its carbon emissions, energy expenditure, and water usage. This information is released to the public in an annual sustainability report.
- Stella McCartney is another luxury brand that leverages its mission in its marketing. The company’s mission is to “challenge and push boundaries to make luxurious products in a way that is fit for the world we live in today and the future: beautiful and sustainable.”
- Stella McCartney advertises the different ways it practices sustainability on its website. It ensures that it sources sustainable materials like cashmere and shares its sustainable fashion strategy in ads and across social media. The company addresses sustainability head on by frequently reminding consumers of its commitment to environmental issues.
Marketing: Impact of COVID-19
The COVID-19 pandemic has significantly impacted the marketing and messaging of consumer brands. The epidemic has resulted in a change of the messaging content for these brands while also leading to the rise of digital marketing.
1. Change in messaging content
- The COVID-19 pandemic has resulted in a significant drop in advertising spend. Still, the brands have innovated, and their marketing is now focused on addressing customer concerns and their safety.
- Brand messaging is now focused on creating awareness regarding the issues resulting from the COVID-19 crisis. An example of this would be the “Stock up on generosity” message from Cottonelle, one of the world’s largest toilet paper manufacturer. The idea behind the messaging from Cottonelle was to discourage panic buying during the time of crisis.
- Brands are also actively educating the world on COVID-19 etiquette; a prime example of this would be Nike, whose campaign aims at encouraging people to ‘play inside‘ to help ensure effective implementation of social-distancing measures.
- Certain brands like Tommy Hilfiger have changed their messaging to promote their e-commerce offerings while focusing on the care, comfort, and connection with the customers.
2. Rise of digital advertising
- As lockdown measures were implemented due to COVID-19, the out-of-home advertising, cinema advertising, and print advertising numbers dropped. The brands then switched to digital advertising, given the migration of consumers to digital platforms.
- With a reduced marketing budget, the brands seem to prefer the digital platform, given its ability to directly interact with the consumers resulting in quick purchases.
- As more consumers are switching to the digital platforms owing to the COVID-19 pandemic, businesses are expected to prioritize digital marketing for lead generation leading to a digital marketing boom.