Tweet

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

Guest post by: Andy Marken

Article Overview: Book review -- The Long Tail: Why the Future of Business is Selling Less of More – Chris Anderson, Hyperion, www.hyperionbooks.com, July 2006, ISBN-10 – 1401302378, 256 pages, $24.95

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

In the technology industry – especially in the Web 2.0 world – few people don’t know – and use – the phrase the long tail. Unfortunately, the majority of the users haven’t spent much time understanding the thinking and the impact of the new economics.

The Long Tail is one of those “ahh haa” books. The insights that Anderson developed as editor in chief of Web 2.0 magazine have become the guiding force for many companies today. Many company executives have read the book so many times that the author’s insights have become an integral part – consciously or subconsciously – of their strategic thinking.

To understand the impact of the long tail you only have to look at Google, Amazon and NetFlix to mention a few firms.

While there are – and will always be – smash hit content and products that fill store shelves and theaters, consumers now have more options. Today’s web economy offers a seemingly infinite inventory to choose from. NetFlix certainly carries all of the current movie hits and sends them to customers by the thousands every day. At the same time they have an inventory of more than 70,000 relatively obscure titles that appeal to a very narrow segment of consumers. They can find their “brand” of entertainment and enjoy it without spending hours, days or even months searching for that one rare copy.

Rhapsody, iTunes, ArtistServer and other online music outlets give consumers – young and old – a global selection of music that suits their taste. , ArtistServer, ArtistServer

And the intelligent software that all of these firms use also uses the consumer’s requests to present content and products that share common points thus giving consumers even more opportunities…to buy.

Anderson shows how organizations and their communications people can gain invaluable insight into their customers’ and partners’ wants and needs to develop new products/solutions and relationships.

Does Anderson forecast the disappearance of mass produced products/services?

No but he does a very thoughtful analysis of how important niche markets can be for firms. In many instances the firms that focus on niches will most certainly sell smaller volumes of product but they will do it more profitably and they will do it with greater customer loyalty.

Anderson developed what he calls the 98 Percent Rule. This means that 98 percent of the products/services available online will be sold at least once. While he developed the concept/theory at the early stages of the second generation of the Internet, many have found that his projections are not always valid.

Only time will prove or disprove Anderson’s thesis. But despite this and the fact that the book suffers from considerable repetition, it is valuable to communications people – and management at large – who must increasingly reach customers on a 1:1 basis.

While Anderson focuses most of his coverage in the book on media and entertainment companies, it is interesting to note that firms like Wal-Mart, Macy’s and Nordstrom’s have developed their own versions of the long tail.

These companies carry the most popular products in their stores but have an online “inventory” of products that is often 4-5 times larger. Many customers seldom step foot in the brick and mortar store yet they “visit” the store regularly to find new and unique items. More importantly…they buy!

Anderson’s book – despite his redundancies – gives you a new understanding of niche marketing and niche customer relations. We no longer have three TV networks. We have an almost unlimited number of choices over the air and across the Internet. In a growing number of instances, firms have taken advantage of this phenomenon to develop their own on-line shows and educational/informational events.

Your company doesn’t need to each 100 million prospective customers. What it needs to do is reach one million of the right customers – business and consumer. It needs to reach them in a consistent manner with the correct product, service and information. Anderson gives you the background, guidance and tools you need to know how to reach these customers and build a strong relationship with this niche market.

The Long Tail is more than just a business book…it is the way you will reach and communicate with customers in the 21st century!

##########

Related Articles
  Chasing your Longtail
  When the long tail is underwater
  Longtail of Search Engine Optimization
  Using Long Tail Keywords to Your Advantage
  Affordable SEO with Longtail Keywords

Article Tags:



Related Forum Posts
Patent Walk-Through - Hello everyone! My name is Alex, I'm 18 years old and I'm constantly drawing up new ideas and inventing stuff. I sketch stuff down everywhere I go and on anything I can write on. I'm a big member of our local Future Business Leaders of America chapter (FBLA). In the future I hope to work my way up to being a Venture Capitalist. I think of myself as a pretty creative person who is very motivated. Some of the ideas and inventions I come up with are pretty far out but others I consider marketable and to have great potential. Being 18, I have little to no connections and no resources. I've been surfing this site pretty frequently for the last year and have finally decided to join the forum group. Anyway, here's my question... Basically, I have no idea how to get a patent together the costs and the overall process. As of now, I think I have a great idea that, as far as I know has not, ever been done before. I'm really excited about this idea. I'm a total novice at this and am willing to learn all that I can. Any information that you can provide me with would be great. Again the main things I want to know are: 1.Overall Process. 2.How Long It Takes. 3.Costs. 4.Anything That You Think I Should Know. 5.Tips/Experiences. 6.Confidentiality. 7.Must I Make A Physical Model of My Idea? Thanks guys! -Alex
Blog pinging - Thanks Martin - yes, I do ping and it has been very effective. I'm currently on the first page of Google for Mastermind Group and on the second page for Selling to Small Business.
Re: How do you budget your life? - Here is my financial management categories for today: 15% Long Term Savings; 10% Home Expenses; 45% Business and Marketing charges; 10% Friends (Meeting); 20$ Scientific and Law Books. But this will change when it is August or September. Orxan
My entry - 1. The Best Business Books Ever: The 100 Most Influential Business Books You'll Never Have Time to Read - this is a fascinating book about the history of Business theory, and I'd recommend it to anybody. 2. The Big Book of Small Business: You Don't Have to Run Your Business by the Seat of Your Pants, by Tom Gegax. Ditto. 3. PADI: The Business of Diving Book Okay, so this book won't be of use to anyone who doesn't want to start a scuba store, but I did, and this book was of course invaluable to me in reaching that goal.
Future Financial Corporation - I've never heard of Future Financial Corporation is this a new company?


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Tweet

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Are You Too Good for Your Job?

THE “SECRET RECIPES” OF LEADERSHIP

WHAT IS MANAGEMENT CONSULTING

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.