Focus on Signal Over Noise

For years Elon and Tesla never spent any money on advertising.

They focused instead on investing in R&D and design since these aspects of business help make the products as good as possible.

 “I ask myself: Will this activity result in a better product or service? If not, I stop those efforts.”

There are grey areas like “Is a Tesla sign design an ad?” but ultimately the important takeaway is how money invested into design and manufacturing is a far better value than money burned on ads that do not significantly move a company forward.

Elon has created Billions of dollars in growth by focusing his investments and then exercising control to accelerate growth.

Here’s a quote from Elon talking with Inc. on the subject:

“It’s OK to have your eggs in one basket as long as you control what happens to that basket.”

Speaking of focus, a powerful statement Elon shared at the USC commencement address he gave is to:

“Focus on signal over noise. A lot of companies get confused.  They spend money on things that don’t actually make the product better.

For example at Tesla we’ve never spent any money on advertising.  We put all of the money into R&D and manufacturing and design to try to make the car as good as possible.

And I think that’s the way to go.

For any given company just keep thinking about are these efforts that people expending are they resulting in a better product or service, and if they are not, stop those efforts.“

Focus on what actually moves the needle forward.  

Focus on signal over noise.