Making matters worse for creators is that blockbusters continue to leave niche products in the dust, particularly in the

Author : gebin.josemuri
Publish Date : 2021-01-06 19:52:03


Making matters worse for creators is that blockbusters continue to leave niche products in the dust, particularly in the

In addition to consumers and aggregators, Anderson also wrote about a third group: the producers of all these niche offerings, for whom he foresaw an effect that would be largely noneconomic, mainly in the form of intangibles like attention and reputation. He wrote that while cultural variety would certainly increase, “How and when the money will follow is something that the next few decades will reveal.”

“The Long Tail” was Anderson’s catchy name for a set of observations about the economics of internet markets — observations that are as resonant as ever in today’s “passion economy,” in which anyone can try their hand at turning their specialized interests into sources of income. In his article and book, building on the work of academics like Erik Brynjolfsson, Jeffrey Hu, Michael Smith, and Anita Elberse, Anderson observed that brick-and-mortar stores were constrained by limited shelf space, and therefore aimed to carry only the most popular products. In sharp contrast, online platforms like Amazon and Netflix had infinite shelf space. The tech journalist’s thesis: This radical shift would have far-reaching effects, from the media and entertainment industries that were his main focus, to the markets for everything from crafts to kitchen appliances.

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Anderson captured both the coming phenomenon of the Long Tail and offered a playbook for taking advantage of it, which attracted broad interest, especially among internet entrepreneurs — basically, an upside for anyone who wasn’t going to win by being in the “hits” business.

For now, producers are seeing mixed results. On the plus side, tens of thousands of people (such as bloggers and podcasters, TikTokers, or Etsy craftspeople) can make at least some money doing what they love. What’s more, sellers of once-popular products can continue offering these products indefinitely, long after their mass sales have dwindled. “We have games that in the retail era would have simply vanished off the face of the earth,” says David Edery, the CEO of Spry Fox, a developer and publisher of games distributed through Google Play, Apple’s App Store, and other game platforms. We can see the same phenomenon in books, which no longer need to go out of print, no matter how few copies they sell each year, because they survive forever in electronic form.

In fact, depending on exactly where on the sales curve you drew the dividing line between the head (sales of the most popular products) and the tail (sales of niche products), and how long the tail actually stretched, the tail was potentially as large as the head, Anderson predicted. Any company that managed to aggregate these niche sales stood to bring in immense revenue. The profit potential was huge, too, as Anderson and many of his readers saw: Although it’s no easy feat to build a well-running, trustworthy marketplace that attracts large numbers of both buyers and sellers, once such a platform is up and running, the costs of adding new users and new products becomes negligible.

Approximately a decade and a half later, we can see just how well Anderson’s thesis has played out. He was absolutely right about the benefits to what he called “aggregators,” particularly the e-commerce platforms selling digital entertainment: He accurately saw that, unburdened from the costs and risks of carrying physical inventory, a platform like Amazon or iTunes was suddenly free to offer an unlimited assortment of ebooks, songs, and other digital goods. Even platforms that sell physical products through many third-party sellers — like eBay and the Amazon Marketplace — could and did easily offer an endless assortment of products. Collectively, therefore, this tail of niche offerings in each platform’s infinite catalog added up to an enormous sales total.

Nonetheless, for the majority of creators, the Long Tail has underdelivered financially. “The way [Anderson] wrote about it caused people to think that individual content creators will suddenly make more money than they used to,” Edery says, “and I just don’t know that that’s true.”

Today, many of us take such vast assortments for granted, until we pause to consider how inconceivable it was 20 years ago that anyone with an internet connection would one day be able to, say, stream a Turkish soap opera or learn how to cook a vegan dish from Zimbabwe. So Anderson was right about the cultural impact of the Long Tail, though he somewhat overestimated how well search tools and recommender systems can actually match users with tastes.

And, indeed, the Long Tail proved a boon to aggregators, as we can see from the success of most of the businesses Anderson was writing about and the many platforms that launched and thrived since he first published his ideas — from YouTube and Spotify to Shopify and BigCommerce.

“That slide was a constant,” Hornik recalls. “I saw it every week for years.” By the time Anderson converted his article into his bestselling 2006 book, The Long Tail: Why the Future of Business Is Selling Less of More, the ideas represented by the term were so well-known in internet startup circles and the slide so commonplace that one founder labeled a slide “The Obligatory Long Tail Slide,” captioning the accompanying graph with the phrase “Enough said.”

Anderson also saw benefits to consumers, who could enjoy within the Long Tail what he dubbed “the paradise of choice,” a delightful contrast to both the tyranny of common-denominator fare and the “paradox of choice” (when having many options is less a blessing than a curse). When Anderson was writing, Pandora was already introducing listeners to a panoply of indie music, and eBay was already auctioning off all manner of used goods and collectibles. He also reported that KitchenAid had recently gone from offering its mixer at Target in just three colors to selling the same mixer online in a choice of more than 50. No physical retailer carried the product in Tangerine, for example, because they didn’t think they could sell enough units of that unusual shade — but low sales weren’t a concern for online merchants, who enjoyed the efficiency of a centralized warehouse.

By seeing this pervasive phenomenon so clearly, spelling out its practical implications for businesses and consumers, and giving it a catchy name, Anderson helped make “The Long Tail” a buzzword, and earned a spot in TIME magazine’s 2007 list of the world’s 100 most influential people. (In it Malcolm Gladwell described the concept as “a Truly Big Idea.”)

Nonetheless, consumers definitely benefited — and these benefits have extended well beyond cultural goods like books and music. Today, if you need a new lint screen for your ancient Maytag dryer, chances are you can order it on FiltersFast.com or AppliancePartsPros.com. And if you prefer to stay in a yurt or a treehouse over a hotel room, you can do so thanks to Airbnb and Hipcamp — just two of many Long Tail service platforms that have sprung up since the book’s publication.



Category : general

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