The ‘long tail’ is a theory first developed by Chris Anderson a former Journalist at ‘The Economist’. It basically asserts that through the advent of digital technologies and the widespread expansion of e-commerce, todays demand curve has a relatively small number of marketable mainstream products when compared to the high number of products which can be targeted toward hundreds of niches. Essentially in todays economy, the consumer is moving away form mass market products, and shifting towards niche markets and niche product categories. Power has also been placed in the hands of the consumer in todays ‘digital age’, now the consumer is able to rate, review and research the product online efficiently prior to the purchased decision. Here is a conceptual demand curve to illustrate how todays economy, namely, the online economy are creating demand for products.
General consensus states the head of the demand curve is made up of 20% of product offerings, whilst the long tail forms 80% of all niche and differentiated product offerings. The underlying premise behind the shift towards the long tail is to sell less of more, this has become much easier with e-commerce and the ability to warehouse products and offer a huge range of products a traditional bricks and mortar outlet could not. However, and article by Chris’s former employer, The Economist highlights that there are critics of the theory. The critics argue that the ‘long tail’ isn’t necessarily sound strategy for all businesses and products. They argue that carmakers for example cannot possible offer a huge list of products without racking up massive production costs, they point out that the more successful Japanese carmakers don’t offer a wide variety of models and choice for the consumer. So is the ‘long tail’ simply a theory which applies to e-commerce? there for effective strategy for Digital Marketers? I think it is a theoretical perspective with true application in today’s market, however, like any theory there are always going to be exceptions to the rule when applying.
Let me know your thoughts below, and feel free to share the article.
Warm Regards,
Eddie
featured image: simplycast.com