Customer Reviews

The Long Tail

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When you want to eat ice cream outside your home, do you go to a store that offers only chocolate and vanilla . . . or do you go where there are many more choices? Most people will do the latter. That's the basic point of this book. If you're satisfied with knowing that point, you don't need to read the book. Instead, you could settle for Mr. Anderson's article in the October 2004 issue of Wired.

But if you are like the growing legions of people who enjoy knowing more about the quirks of micro-economics (such as those who were intrigued by The Tipping Point, Freakonomics and Fooled by Randomness), The Long Tail will provide much entertainment.

Let me explain what a long tail is. If you plot the popularity of various products (say, books on Amazon) with the most popular products at the left, the left part of the curve will be very vertical (the head) and there will be a long list of items to the right that will have relatively few sales (the tail). Mr. Anderson's point is that as it becomes economically viable to produce and distribute more low-volume products (such as print-on-demand books and e-books), there will be more items available to purchase at any outlet . . . and the length the tail to the right will grow. As more outlets can afford to make these items available, the thickness of the tail will also grow.

A physical store will only distribute a small percentage of the items, stopping where the offering no longer adds to its targeted rate of profits. An on-line store will have far more items (such as Amazon), appeal to more customers and sell lots of its volume in relatively unpopular items. The author estimates that 25% of Amazon's book sales volume, for instance, comes from outside the 100,000 top selling books.

Here's where Mr. Anderson begins to lose his way: He tries to describe the sociological implications. He sees, for example, a loss of common cultural items of the sort that talking about the Beatles appearing on Ed Sullivan once provided. He imagines a world in which everyone drifts off into various different niches and the size of the head becomes less vertical. While that may be true, it doesn't correctly forecast the amount of commonality in the culture. The sales of any given item over time may well be in both the head and the tail. Or an item could be a sleeper and always be in the tail, but if enough people buy it, the item will become part of the common culture. In addition, some elements of common culture don't appear in sales curves. I'm sure that yesterday's arrests in the alleged plot to bomb a number of airplanes have already become part of the common culture.

I won't go on to point out his other errors. I'm sure you'll notice them for yourself.

The other disappointment was that he doesn't do a very good job of describing strategy choices for product producers. It seems to me that the long tail is simply another argument in favor of intense individual product and service customization of the sort that Dell has been giving us for years in computers and related equipment.

My grade of 3 stars for the book is 5 stars for long-tail trivia and 1 star for sociological and producer analysis.

If you haven't read any of the following books, The Tipping Point, Freakonomics and Fooled by Randomness, I recommend that you read those long before you get around this one. They are much better books about micro-economic implications.

Chris Anderson is an editor-in-chief of the Wired magazine, and the eponymous article 'The Long Tail' appeared in that magazine a couple of years ago. This has been one of the most influential and read articles about the 'new economy', and rightfully so. In a few succinct principles it describes and explains the essential aspect of the several new successful business models, including Google, Amazon, eBay, Netflix, to name just a few. The basic mechanisms behind the model, however, have been around for a long time, but the advent of the Internet has spurred it on to previously unimaginable successes. This book builds on the arguments from the original article, and adds the material from Chris's blog. It's highly informative, yet eminently accessible and readable. A warning is in order, however: after reading the book you might start seeing long tails in all sorts of places. Consider yourself warned.

I read the original article. It was brilliant. He should have left it at that. The book got very repetitive to the point where it became the long read.

I read a great book (actually I listened to it on the seven CD set) that is a must read for any business person called, "The Long Tail, Why the future of business is selling less of more" by Chris Anderson. Chris Anderson is the editor of FAST Company magazine.

The thesis of his book is that we are increasingly able to cater almost everybody with every taste with a huge degree of variety and this huge degree of variety allows products to have what he calls long tails. For example, rather than everybody simply listening to popular music, they can listen to many sub-genres.

Much of what he talks about is possible because of the Internet so a lot of his examples have to do with books and music and movies, etc., on the internet.

The reason it is a must read for any business person is understanding markets and where things will sell are definitely a critical part of business success.

In the October 2004 issue of Wired magazine, Chris Anderson published an article in which he shared these observations: "(1) the tail of available variety is far longer than we realize; (2) it's now within reach economically; (3) all those niches, when aggregated, can make up a significant market - seemed indisputable, especially backed up with heretofore unseen data." That is even truer today than it was three years ago. The era that Anderson characterizes as "a market of multitudes" continues to grow in terms of both its nature and extent. In this book, Anderson takes his reader on a guided tour of this market as he explains what the probable impact the new market will have and what will be required to prosper in it.

According to Anderson, those who read the article saw the Long Tail everywhere, from politics to public relations, and from sheet music to college sports. "What people intuitively grasped was that new efficiencies in distribution, manufacturing, and marketing were changing the definition of what was commercially viable across the board. The best way to describe these forces is that they are turning unprofitable customers, products, and markets into profitable ones." Therefore, the story of the Long Tail is really about the economics of abundance: "what happens when the bottlenecks that stand between supply and demand in our culture start to disappear and everything becomes available to everyone."

If I understand Anderson's most important points (and I may not), they include these:

1. Make as much as possible available to as many people as possible.
2. Help them to locate what they need, quickly and easily.
3. Offer maximum inventory only online.
4. Customize supply chain in terms of niche markets
5. Maximize its efficiencies and economies (especially inventory control, order processing, and distribution,)
5. Be customer-driven in terms of "crowdsourcing"
6. Have strategy that separates content into its component parts (i.e. "microchunking")
7. Have a pricing strategy that is "elastic" (i.e. based on the ROI of fulfillment per product per niche).
8. Have an open source business model for information sharing.
9. In markets where scarcity exists, "guesstimate" costs, margins, sales, profits, etc.
10.Where there is abundant competition, let those markets "sort it all out."

These and other points can guide and inform decision makers as they struggle to compete profitably during the era of "long-tailed distributions," when culture is unfiltered by economic scarcity and high technology is turning mass markets into millions of niches. Anderson provides invaluable advice with regard to how minimize the cost of reaching, penetrating, and then developing a multiple of niche markets. The paradigm has shifted from selling more in fewer markets to selling less in more markets but also, key point, selling as much as possible within as many segments as possible -- and prudent -- within those markets.

Those who share my high regard for this volume are urged to check out two books by Henry Chesbrough, Open Innovation: The New Imperative for Creating and Profiting from Technology and Open Business Models: How to Thrive in the New Innovation Landscape. Also Geoffrey Moore's Dealing with Darwin: How Great Companies Innovate at Every Phase of Their Evolution, Howard Gardner's Five Minds for the Future, Richard Ogle's Smart World: Breakthrough Creativity and the New Science of Ideas, Gary Hamel's The Future of Management, Noel Tichy and Warren Bennis' Judgment: How Winning Managers Make Smart Calls, Steven Feinberg's The Advantage-Makers: How Exceptional Leaders Win by Creating Opportunities Others Don't, and Seeing What's Next: Using Theories of Innovation to Predict Industry Change co-authored by Clayton M. Christensen, Scott D. Anthony, and Erik A. Roth.

This is a great book about how much the Internet is changing commerce and business in every sense. From the library and the dewey decimal system to how the marketing of movies have changed. An amazing book that everyone who is wanting to do business on the Internet should read before going into business.