Does Tesla's Slump Owe To Musk's Behavior?

This is why Musk's controversial comments and political endorsements have alienated some Tesla consumers, particularly in progressive markets such as Europe and California.

In these places, Tesla has historically been popular with environmentally aware consumers. When the profiles of a CEO and his or her brand are not aligned, it's a problem that can undermine the brand value of both the CEO and the company.

Artists, politicians, CEOs and other public figures tend to attract fans whose personal values can at times deviate from those of the figurehead. Where this happens, devoted fans might be left at an impasse on how to respond to these figures or the products of companies or businesses they are associated with.

A common misconception is that smitten fans are too obsessed to express their distaste. Instead, they are likely to follow blindly and defend the actions of their heroes. Intense actions of “fan armies” on social media platforms have not helped with these assumptions.

But in fact, our research has shown that devoted fans can be critical . We found they are more likely than less devoted consumers to respond in extreme opposition when they feel betrayed by the behavior of personalities they identify with or hold in high regard.

In the case of personalities like Musk, whose companies produce physical products, loyal fans and consumers could respond in a number of ways. A few hardcore Tesla fans and Musk loyalists might dismiss critiques of his behavior as attacks against free speech or their own beliefs.

They are likely to continue buying Teslas regardless – and may even adjust their own beliefs to align with those of their“hero.”

For other consumers, owning a Tesla may no longer signal purely their beliefs about sustainability. There may be a nod to political or ideological affiliations that do not align with their own.

Some consumers may want to dissociate with Tesla if Musk's behavior is seen as problematic in their social circle. However, as a purchase requiring high involvement and commitment, switching from Tesla to another EV might be difficult.

The recent trend of Tesla owners placing apology stickers on their vehicles is a way of negotiating the tension between owning a Tesla and the behavior of the CEO they do not agree with.

The stickers provide a means of separating themselves from Musk's actions while managing the fear of being perceived negatively within their social groups. This is likely to result in a gradual brand erosion rather than an immediate sales drop.

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On the other hand, customers of companies such as craft beer brand BrewDog – a firm that has in the past been accused of fostering a culture of fear – may be more responsive to bad CEO behavior. They at least can switch to an alternative brand at little cost. (BrewDog, for its part, apologiszd and said it was “committed to doing better.” )

And if Remain voters dislike inventor James Dyson's stance on Brexit, they might be annoyed but still able to justify keeping a mid-value item like a vacuum cleaner (that is used privately in the home after all) until it breaks, perhaps switching for future purchases rather than abandoning outright.

Consumers can respond in a variety of ways when a figurehead CEO disappoints them. But brands taking blind, uncritical loyalty as a given – even from devoted fans – do so at their peril.

James Obiegbu is lecturer in experiential marketing and management, Bournemouth University and Gretchen Larsen is professor in marketing, Durham University Business School, Durham University

This article is republished from The Conversation under a Creative Commons license. Read the original article .

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