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Tesla had a fourth quarter of profitability. And while some analysts question the quality of profitability, those numbers are quite a coup. However, there are some other numbers that aren't all that wonderful.

Tesla cut at the recent J.D. Power Initial Quality Survey 2020 badly. The survey evaluates problems new owners experience within the first 90 days of owning the vehicle. The J.D. Power Initial Quality Survey examines problems per 100 new vehicles. The industry average is 166 problems per 100 vehicles. Tesla had 250 problems per 100 vehicles. Tesla did not allow J. D. Power to interview owners in 15 states, so the most recent data comes from new owners in 35 states. This makes Tesla not officially classified. It is still below Land Rover vehicles, however, which is an unfortunate achievement as Land Rover vehicles have been among the lowest initial quality rankings for some time.

On the other hand, Tesla achieved the highest place in J.D Power's 2020 APEAL study with 896 points. This is an exceptional score. As with the first quality survey, Tesla is not officially rated. The industry average is 861. Porsche, the vehicle with the highest official ranking, scored 881. The J.D. Power Automotive Performance, Execution and Layout (APEAL) study evaluates how an owner emotionally connects with the new car by measuring the owner's "excitement" in 37 areas. In the 2020 study, 87,000 owners were surveyed.

According to J.D Power's website, “the APEAL study measures an owner's emotional attachment to their new vehicle and in which areas this vehicle may not deliver all of the positive experiences they had hoped for. Understanding this is just as valuable to automakers as knowing about quality issues and owner acceptance of new technologies. The goal for automakers is to inspire customers in all of these dimensions. Some are better at this than others. "

The Wall Street Journal calls the two conflicting results an automotive paradox. Paradoxical, yes, but these results aren't that surprising. This paradox is actually related to well-studied customer attitudes. Data shows that many people tend to accept experience advantages in order to override perceived quality deficiencies.

Brand quality versus brand image

One of the best explanations for why people overlook quality issues while loving the brand experience is a 2008 study by the Journal of Business Research. The study focused on the relationship between brand quality and brand image. The study examined what happens when quality and image do not match. How can a brand with problematic quality have a really good and convincing image?

The researchers identified some fascinating data. The study confirmed that a low brand image is much more damaging than low brand quality. If the buyer's motives are hedonistic, then poor quality is a less important driver. In other words, a strong brand image can overcome negative quality issues. In the case of cars, the study showed that “quality steps are not as strong as efforts to improve the brand image”.

This doesn't mean that high-image brands like Tesla should ignore quality issues. This means that high image brands like Tesla can recover from quality imperfections while maintaining the admiration of the user group. Hence, it is possible for Tesla to have initial quality issues while experiencing strong exciting, experiential benefits that create compelling pull that translates into sales.

The brand believers

Tesla buyers are brand believers. They believe in the electric model and its sustainability. They believe in the technology as well as the performance that technology offers. Tesla customers believe in Elon Musk and his confidence in his ability to deliver what he promises. Tesla owners can cheer when they read glowing articles like the recent one in the New York Times about Mr. Musk's personal life and beliefs, including an ironic interview with Maureen Dowd. Tesla believers may see Mr. Musk as one of those one-off visionary but quirky founders a la Steve Jobs. Owning a Tesla is a symbol of innovation and environmental concerns.

The dichotomy between quality and image is not new to the automotive industry. In its heyday, Jaguar's beautiful cars were also cars with quality issues. Still, many Jaguar owners have been very loyal to the brand. Jaguar owners continued to buy XKEs even when their customers had bad experiences. It is similar with Land Rover vehicles. Land Rover has been one of the lowest in J.D. for years. Power initial quality studies, and yet the vehicles remain an extremely impressive and eventful family of car brands.

Because Tesla customers are emotionally and empirically invested in the brand, they overlook the quality issues. This doesn't mean that Tesla should ignore its vehicles' initial problems. However, this explains why Tesla brand believers experience problematic quality and still have a strong emotional attachment to the brand. Tesla brand believers may not find the brand's quality attributes problematic enough to delay a purchase.

Contribution to Branding Strategy Insider by: Larry Light, CEO of Arcature

At The Blake Project, we help clients from all over the world at all stages of development to build strong emotional connections. Please email us for more.

Brand Strategy Insider is a service from The Blake Project: A strategic brand consultancy specializing in brand research, brand strategy, brand growth and branding

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