For Elon Musk’s Tesla, there is such a thing as bad publicity

If you live in the USA you’ve seen the bumper sticker, numerous times. You’ve pulled up behind a Tesla and there in bold font is a simple but striking message staring back at you in traffic: ‘I bought this before Elon went crazy.’

There are other versions. Some of the badges change the word ‘crazy’ to ‘fascist’ or ‘weirdo’. Other stickers proclaim the owner to be a member of the ‘Anti Elon Tesla Club’. All of them essentially communicate the same message about the car’s owner.

I am a centre-left, ecologically minded liberal who purchased a Tesla when its CEO was deemed to be of similar orientation. I have subsequently watched as said CEO moves dramatically to the right, allies with my least favourite US President of all time and exhibits a range of behaviours that cause me significant and continual liberal distress. As I sit in my (rather good) Tesla, I feel a potent combination of shame, foolishness and anger. I feel it every time I see Musk on TV. I feel it every time I open the door of my Tesla.

I am wracking my mind for a similar situation. One in which current consumers of a brand also represent its biggest enemies. Clearly there are examples, from Bud Light all the way back to Ratner’s and New Coke, in which consumers lost faith with a brand and stopped consuming while variously burning/shooting/protesting it in public. But I cannot think of another instance where so many consumers protested such a big brand while continuing to consume it so conspicuously.

Imagine a Bud Light drinker bemoaning the beer’s political stance while drinking it at a bar. Or a woman complaining that Ratner’s stuff is all crap while fingering the earrings she bought there last Tuesday. Or a man shaving with his Gillette razor while decrying the brand’s stance on toxic masculinity into the mirror.

Plummeting share price

There is no doubt that Tesla is in trouble. The company reported its first ever decline in US deliveries in 2024 and 2025 looks tricky too. In China wholesale Tesla sales are down 49% on last year. In Germany they have dropped an astonishing 76%. Seemingly everywhere you can buy a Tesla, people aren’t buying Teslas. Yesterday’s stock-market dive wiped $700bn off Telsa’s valuation. And its share price has dropped more than 50% since its post-election, mid-December high.

It’s important to recognise that factors other than you-know-who are playing a role in Tesla’s dismal trading. The whole EV category is in transition, with China’s ascendency sending shockwaves through many established automotive companies. In stock-market terms, this was a miserable start to the week for every listed firm and Tesla was merely the hardest hit of a raft of big stocks. Tesla has also been riding a wave of overvaluation that peaked with Musk’s apparent proximity to a new American President late last year. A slide was always going to follow at some point.

But amongst all the other issues, is the Musk Effect really having a huge impact on Tesla’s appeal? In the Nineties and Noughties marketers were convinced that brands were vulnerable things that could be destroyed or severely impacted by inconsistencies and crises. Reputations, the old horseshit proverb goes, take decades to build but only seconds to be destroyed.

Over the last decade the world of brand management has changed its collective mind about that almost completely. Reputations do not take that long to build in the age of TikTok. And with Trump back for four more years it’s clear that they are pretty fucking hard to destroy once you do. A scandal here. A dollop of indiscretion and notoriety there. A loss of trust. An unfortunate association. All of these and more hardly seem to hurt the brands in question. Occasionally they may even help in the long run.

The Musk Effect is somewhat culpable for Tesla’s current woes because this is a special kind of bad publicity. The kind that is very, very public. And the kind that is indelibly antithetical to what the brand stands for.

I’ve covered two notable examples in columns for Marketing Week. An ill-advised report suggested that Corona beer was in trouble because Americans associated the brand with a newly discovered coronavirus called Covid-19. I suggested that was total pants and that sales would probably go up, not down, as a result. And it was a similar story when Marmite tried to raise prices in response to Brexit cost increases. Rarely has a food brand garnered such negative headlines. Brand metrics sank. Negative buzz reached a crescendo. And yet, at the end of the quarter, Marmite sales significantly increased – not despite, but because of, all the coverage.

The explanation for all this is relatively simple. Salience, as the Ehrenberg Bass Institute constantly reminds us, is more important than anything else. Sure, it’s ideal if you can increase your mental availability while also pushing all the right image buttons too. But brand salience and brand image aren’t always equally important. If salience is the main purchase driver then trading some of your brand image and positioning perfection for more coverage and buzz makes a lot of strategic sense. After all, a perfectly crafted brand image is worthless if no-one thinks about you when the buying moment arrives. Better to be there and off-brand, than not there at all.

And sometimes a brand needs to go against itself to drive the salience that will ultimately stoke sales. Remember Tiffany boasting that it was no longer your mother’s brand and the fallout that followed? Or KFC running out of chicken and rebranding as FCK? Both brands got flak but quickly emerged all the better from their brush with notoriety.

Marketers now often query whether there is even such a thing as bad publicity. They look at even the worst brand scandal and conclude it will be good for business because “at least we are all talking about it”. In the age of Trump and Kim Kardashian, have we not learned that attention, of any kind, always works wonders. And that image, consistency and depth are hugely overrated?

And yet there is such a thing as bad publicity. It’s called ‘bad publicity’. Instances take place far less frequently than marketers once thought. And they occur only in very special circumstances. But they do happen. And, when they do, like the one engulfing Tesla right now, the results can be catastrophic for brand equity and ultimately for sales.

Going against brand positioning

The Musk Effect is somewhat culpable for Tesla’s current woes because this is a special kind of bad publicity. The kind that is very, very public. And the kind that is indelibly antithetical to what the brand stands for. That last bit is essential. Corona’s association with Covid-19 was grisly but it wasn’t directly opposed to its beachy cool vibe, just incongruent. Marmite’s attempt to raise prices proved unpopular but it was never antithetical to its brand image.

Only very rarely do events serve up a negative crisis that is directly and entirely counter to a brand’s accepted position to its customers. And rarely does this happen with so much publicity that it inflicts significant damage to mass-market sales. But it can and will occasionally happen.

Bud Lite was beloved for its absence of agenda and empty signifiers until it was suddenly taking sides in a gender war. And the saga and subsequent response to it generated news cycles for weeks. Gillette was a masculine brand for conservative middle-aged masculine men, until it ran an infamously misplaced ad blaming these very consumers for their brand of masculinity. Ratner’s jewellery was low-priced, good-value jewellery for the masses until its founder destroyed everything by joking that its jewellery was actually the diametric opposite – “total crap” – in a speech covered that night across national news.

Why It Works: Tesla and the side effects of Elon Musk

And now Tesla. And the dangerous combination of intense, extended media coverage combined with a branding volte face of remarkable contradiction. The brand was seen by consumers as progressive. It was deemed to be environmentally responsible. It was a brand that was fighting against the establishment. And consumers bought into that position and bought those cars because Musk was the ultimate personification of the brand.

But, as we now know, Musk stopped being progressive and started being conservative. He began to work for a President that chanted “Drill, baby, drill!” at rallies. He became part of the established order. Everything changed. And changed completely. Not just the perception of Musk. But the perception of his car brand too.

Tesla partly brought this on itself by avoiding proper brand building for years. The company very deliberately leaned in on its CEO as a walking billboard for the brand, despite recurrent warnings that building a trillion-dollar brand around one man was inherently risky and ultimately mistaken. Had Tesla started a campaign for its cars five years ago the Musk Effect would not have been negated, but it would have been lessened.

Instead, Tesla is now looking at a significantly weakened brand in a difficult category that becomes more competitive by the month. There is no sign that Musk will change course either. If anything, he seems to be doubling down on his MAGA future. Many Tesla customers will continue to despair. Others will sell their cars. Even more will select an alternative brand. And maybe, finally, somewhere down the road we can all accept that there is such a thing as bad publicity.

Mark Ritson launches the MiniMBA in Marketing and the MiniMBA in Brand Management in April. Places now available.