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The Long Tail: Why the Future of Business is Selling Less of More

The Long Tail: Why the Future of Business is Selling Less of More

What happens when the bottlenecks that stand between supply and demand in our culture go away and everything becomes available to everyone?

"The Long Tail" is a powerful new force in our economy: the rise of the niche. As the cost of reaching consumers drops dramatically, our markets are shifting from a one-size-fits-all model of mass appeal to one of unlimited variety for unique tastes. From supermarket shelves to advertising agencies, the ability to offer vast choice is changing everything, and causing us to rethink where our markets lie and how to get to them. Unlimited selection is revealing truths about what consumers want and how they want to get it, from DVDs at Netflix to songs on iTunes to advertising on Google.

However, this is not just a virtue of online marketplaces; it is an example of an entirely new economic model for business, one that is just beginning to show its power. After a century of obsessing over the few products at the head of the demand curve, the new economics of distribution allow us to turn our focus to the many more products in the tail, which collectively can create a new market as big as the one we already know.

The Long Tail is really about the economics of abundance. New efficiencies in distribution, manufacturing, and marketing are essentially resetting the definition of whats commercially viable across the board. If the 20th century was about hits, the 21st will be equally about niches.

The Long Tail: Why the Future of Business is Selling Less of More

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Authors: Chris Anderson
Binding: Hardcover; 256 pages
Publication Date: 12/22/08
Publisher: Hyperion
ISBN: 1401302378
Bookhuddle Average Rating: (5.0)
Amazon.com^® Average Rating: (4.0)

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Number of Reviews:1, Bookhuddle Average Rating:

(5.0)

D@Bookhuddle

(5) Source of opportunity

This book helped me understand the opportunities that exist in the "tail".

There are millions of people out there that share similar, but niche interests or needs and they have until not too long ago been separated by geographical constraints and creating viable businesses to target these niches has been difficult.

The internet, in several ways, has helped remove or reduce constraints (geographical, production, distribution, etc) and has enabled it to be economically viable to address certain markets.

Number of Reviews: 192, Amazon.com^® Average Rating:

(4.0)

(4) Good shape

The book received was in general good shape. The only issue I was not aware of was the fact that some parts of the book were highlighted. However, this does not suppose any kind of problem for me.

(4) Insightful and Well Researched

This book is a quick read not because the text is large or the concepts are necessarily simplistic, but because it is well written and you can tell the author, Chris Anderson, takes a great interest in the topic.

The book does a great job of discussing some of the reasons why the internet and user reviews (like this one), iTunes, etc have changed the way we shop for and purchase products. It is interesting as a consumer and would probably be even more interesting to someone in an industry affected by The Long Tail.

(3) Interesting, but of limited use

Most people have heard various flavors of the 80-20 rule (20% of goods sold result in 80% of profits, 20% of the time of a project delivers 80% of the results, etc.). The 80-20 rule is usually invoked to suggesting focusing more on the little that results in a lot. This book, in essence, says the idea of applying that rule to products is coming to an end.

First, the curves (technically called power-law distributions) are getting flatter. Expressed another way, the heads are getting smaller and the tails are getting longer, hence the name of this book. This is really the crux of the book, and it points toward cheaper means of production (of items from music to video to books, etc.), cheaper distribution (via the internet), and better ability for consumers to find new items (via Google and recommendations from proprietary sites or blogs) as all contributing to this phenomena.

Second, while the number of sales *per unit* is smaller in the tail, by having greater and greater varieties of items in the tail, one can still aggregate to very large numbers. For example, while the top 10 selling books in 2004 sold about 17 million units (combined), the million worst selling books sold about 15 million units. Closer to the center, about 220 books combined would sell that number.

Third, as more and more items go in the digital direction (where the concept of inventory doesn't apply - such as with digital music providers like iTunes), the cost to carry a virtually unlimited selection of products is nearly zero. Therefore it pays to carry everything- even a few sales should still add to profits.

Putting all this together paints an interesting picture of the future of retail, but is not very practical. In the book, the author mentions that it started with an article in Wired magazine. For those less interested, perhaps it should end there. Towards the end is some advice, but all of it is geared toward the aggregators/retailers, not the producers.

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The Long Tail: Why the Future of Business is Selling Less of More

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