Market Intelligence Insights

As promised by Elon Musk, the world received “some Tesla news” on Thursday, February 28. The car manufacturer announced that it would now be offering a $35,000 Model 3, despite the public’s skepticism around the probability of this happening. It is the final step in Elon Musk’s famous first Master Plan to bring electric vehicles to the masses. There is still scrutiny as to whether Tesla will be able to make money on this offer, especially due to the drop in stock price following the news.

Tesla made another major announcement that they are going to shift 100% of their sales to be conducted online. This has stirred a major debate on whether this is a strategic decision, or if it will lead them to bankruptcy. Regardless, it is an important area to analyze given the transformative impact of electric vehicles. As Cathie Wood of ARK Invest stated on CNBC, the electric vehicle market is expected to reach sales of 26 million units by 2023, up from 1.3 million units last year, with Tesla leading the market. We decided to take an evidence-based approach using SimilarWeb’s Marketing Solution and gather digital insights into tesla.com.

Tesla vs. Competing Car Buying Sites

In the beginning of February, tesla.com averaged 172K visitors, behind kbb.com at 637K, cars.com at 705K, and autotrader.com at 824K. While their traffic was the lowest of the four, their nearly 4X increase on announcement day had them sitting only 100K behind the rest. On March 1, their traffic surpassed the other three sites to sit at 941K, with the rest sitting below 799K. Tesla.com also saw the best engagement at 8.5 pages per visit and 31.2% bounce rate, compared to the other three sites that sat below 8.0 pages per visit and above a 42% bounce rate.



You may be wondering why we are comparing tesla.com to car buying sites as opposed to car manufacturing sites. In fact, that is what is the most interesting and unique about this story. Tesla, unlike car manufacturers such as Ford, Toyota, and BMW, is the only one that is truly competing digitally with car buying sites. The other manufacturers only offer the ability to build a model, get pricing options, and locate the nearest dealer to execute the sale. There is no transactional activity on their sites, which is an important reason why people should not only be looking at Tesla relative to other car manufacturers, but relative to other car buying sites as well.

Tesla vs. Competing Car Manufacturers

In analyzing US traffic to tesla.com against ford.com, toyota.com, and bmwusa.com, we saw that in the beginning of February, tesla.com averaged 172K visitors, ahead of bmwusa.com at 94K, but behind toyota.com at 322K and ford at 358K. This changed on the day of the announcement, where tesla.com traffic nearly quadrupled to 668K, and surpassed the other three sites sitting below 435K.



This disparity grew further on March 1, where tesla.com traffic sat at 941K, with the other three sitting below 398K. The traffic came from 67% desktop and 33% mobile web. Tesla.com also saw the best engagement over this time period relative to the other sites that all sat below 7.5 pages per visit and above a 34% bounce rate.

Traffic Breakdown to tesla.com

The main sources of traffic going to tesla.com were direct traffic, and organic search, with almost no traffic at this time coming from paid search. From January to February, direct traffic increased by 25%, indicative of heightened brand awareness. The top organic keywords were also heavily branded, to include tesla, tesla model 3, model 3, tesla model x, and more. This means that a majority of their exposure is earned. The three competing car manufacturers all have paid search accounting for over 6.5% of their traffic, while the three competing car buying sites all have paid search accounting for over 4% of their traffic.



Social media is the third largest contributor to tesla.com traffic, potentially a result of Elon Musk’s Twitter account that boasts 25 million followers. Twitter provided the largest share of social traffic this past month to tesla.com at 35%, followed by YouTube, Reddit, LinkedIn and Facebook. In January, YouTube took the lead at 38.6%, followed by Twitter, LinkedIn, Reddit, and Facebook.



A Look Back at March 2016

On March 31, 2016, when the Model 3 plans were initially announced, Tesla was operating under a different URL: teslamotors.com. We saw similar trends to those seen recently: on March 31, the site reached 773K visitors, before increasing to 1.323M visitors on April 1. Tesla published that 400,000 people deposited $1,000 and placed a reservation following the announcement.



The main source of traffic at this time was organic search, and, similar to this year, was heavily branded, with keywords such as: tesla, tesla model 3, tesla motors, and model 3. Average visit duration sat at 04:13, pages per visit at 4.7, and bounce rate at 37.8%. While traffic may have been higher surrounding the 2016 announcement, traffic engagement was better for the more recent one, at 04:44 average visit duration, 8.5 pages per visit, at 21.3% bounce rate

Conclusion

If the amount of reservations converted from the 2016 announcement is at all similar to the amount of orders from the most recent announcement, it is likely that Tesla will produce and deliver many Model 3’s over the next six months. According to Elon Musk, 78% of Tesla’s 2018 Model 3 were sold online, but only time (and numbers) will tell if this sales strategy will be a success!

Written in collaboration with David Biegeleisen.