Auto Dealer Groups Escalate Battle Against Tesla Stores Page 2

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Tesla's retail store concept

Tesla's retail store concept

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As we reported earlier this week, Tesla now faces lawsuits in four states, and as the company's network of showrooms expands, we'd expect to see a few more dealer networks calling up their armies of legal experts.

Ahead of the curve

Tesla and Musk surely understand that they're pushing the boundaries of what's acceptable in these showrooms. After all, being audacious is part of their M.O.

But unlike today's attention-starved pop stars, Tesla isn't just pushing boundaries for the sake of being edgy. They're exploring new ways of communicating with customers, and in doing so, they seem to be part of a larger trend of soft-sells and conversations, rather than old-school, stereotypical car sales techniques. 

Think of social networking, think of Facebook and Pinterest and Instagram. This is how a growing number of us get our information and how we communicate with friends, "friends", businesses, and brands. Successful marketers on social networks aren't the ones who shout offers at potential customers, Mad Men-style; they're the ones who share information, engage consumers, give the public a sense of what they're about, let shoppers peek behind the green curtain. 

That, in essence, is what Tesla is doing. Its showrooms are more like information hubs than traditional car lots -- that's why they're located in malls. The company's front-line workers are like Apple Geniuses, answering questions and explaining what makes Tesla different from its competitors.

Basically, Tesla has reimagined the auto shopping experience, removing the two things that customers hate most: haggling and buying. Creating a space for the public to window shop for cars, without pressure from sales personnel? That's pretty smart.

In fact, it's so smart that Audi recently riffed on the idea with its new Digital City showroom in London. Will Audi run into the same legal problems as Tesla? We'll know soon: the company plans to add another 19 of its showrooms over the next three years.

Our take

There's little question that Tesla's showrooms are skating on thin ice when it comes to legal issues. The real question is: are state franchise laws outdated? Are the laws that Tesla is flouting in need of revision?

And just as importantly, will Tesla's soft-sell sway shoppers?

Let us know your thoughts on Tesla's unique techniques in the comments below.


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