$100,000 or greater. The use of Car and Driver is intended to specifically target the car enthusiasts in our target market and generate buzz in the car community through the strong word of mouth advertising that Tesla has formerly enjoyed. Wired magazine was chosen based on the fact that our target market is in the innovators group; they are well informed tech savvy consumers. This magazine attracts that type of reader. The total audience for Wired is just over 3.2 million of which 75% are males. The median age for the magazine is 34 years, and the median household income is just shy of $86,000. This again is a very specific market, but it follows the niche strategy of targeting a large number of customers within a small market segment. To broaden the company’s advertising reach the company will also invest in ad space within Bloomberg’s BusinessWeek and Forbes magazine. This will still target Tesla’sspecific target market but it will have a broader base than the specific interests of Car and Driver and Wired. BusinessWeek currently has a total audience of 4 million, of which 63% are male. The median age is 46.3 years and the median household income is $101,076. Forbes magazine boasts an audience of 5.1 million people, of which nearly 3.5 million are men. With a median age of 43.1 years and 2.3 million users with household income of $100,000 or greater, Forbes magazine not only reached Tesla’starget market but generated buzz within the business community about an entirely electric, affordable, luxury performance sedan. To maximize the potential return on investment, these ads strategically placed within these four magazines in a cyclical flow throughout the 12 months from July 2012 to June 2013 for Model S and still going on periodically for Model X and upcoming Model III. The per issue costs for each magazine are broken down in Exhibit 2 and show the total costs for one ad in all four magazines to be $496,000. If each magazine is utilized 3 times a year that brings the total advertising budget to $1,488,000. This method of reaching the target market will be most effective because it will reach a large number of consumers without a frequency that is oversaturating the market. Exhibit 3 shows the projected timeline of when each advertisement will appear in each magazine. Car and Driver will featured an ad in July, November, and March; BusinessWeek featured an ad in August, December, and April; Wired featured an ad in September, January, and May; and Forbes featured an ad in October, February, and June. This plan ensured that the advertisement is consistently seen throughout the year within the various magazine outlets.
13 Tesla, Inc. 12-May-2017 Sales Promotion Consumers who purchase luxury performance sedans are highly price insensitive, purchasing cars more on the quality, performance, and features rather than on a specific price point. Based on this knowledge, sales promotion will not be a significant factor in the promotional mix. However, since Tesla has received strong support from the United States government, the company will be able to stimulate demand for the product by offering a $7,500 federal tax rebate on the Model S.