Why the Future of Business Is Selling Less of More

This is, maybe, the most practical but deeply sustained book I've ever read about how to make business online. If someone want to make business in Internet, she should read this book first. Why? Long Tail Theory roots the very basics of Internet: It is about niche. It is all about finding, loving, breathing, caring about your niche.

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However, the short version is this: The book is easy to read, and it has a ton of practical application for every business from snack food to shoe sales.

Even more important, it's fun, written like an article in a magazine and something you could knock out on a plane flight. Highly recommended.

Timeless as an historical observation and prophetic in its application to the evolution of supply and demand. A must to follow the course as it defines an age. I don't know what I mean either. Its really an awesome book.

The book was very redundant. I read it for school, so maybe if you are reading it by choice you will have a better experience. Very interesting concept, but I felt that only the first few chapters were necessary.

A must read for everybody involved in E-business. Chris Anderson makes compelling arguments backed by solid research and data. Even after some years on the shelf this book is still relevant for people who wants to understand why the local shop on the corner is closing.

A colleague recommended this one to me. What an outstanding book. Completely changes your way of thinking on the economy and really makes you understand the power of the Internet for media. A fast, easy, entertaining, and informative read.

This book started off as an article in Wired Magazine, and it was an excellent one. But Anderson must have decided to cash in, because the book doesn't add anything that wasn't covered in the article itself. It's not a complex concept.

Read the article on the Wired website. Then go spend your money on something from a tiny niche market.

Chris Anderson does a great job explaining the phenomenon that is happening in this new age of virtually unlimited choices in just about every category where "shelf space" or Internet listings cost next to nothing, inventory does not have to be physically maintained and a physical store is not required. Indeed, there is money to be made from products that are not "hits". With so many choices and people searching for an ever-so-specific range of products, companies who offer a very wide range of products will be able to sell a few of each unit per year. On aggregate, these few sales across such a wide range of niches can add up to serious money if your carrying costs are almost zero.

But how do these companies attract their audience?

You'll have to read some other book to learn the answer to that question because Anderson does not answer it.

This book stops short of telling us how these aggregators of vast amounts of products that appeal to a wide range of niche interests build their brands so people find and prefer them in the first place. If anyone can now easily list a virtually unlimited number of products online in just about any product category, what is going to set any one apart from the rest in any given category?

That's where this book falls down.

This book should have talked about the importance of building a dominant brand in your category and how to create strategic brand awareness so YOU are the first choice for consumers shopping your category. In fact, with the cost of entry so low, the author does not tell us how to compete against other companies who choose to operate in the long tail of the same category. If long tail theory holds, then there will eventually be an unlimited number of competitors offering the same vast array of products in your category. How can any one stand out and be preferred?

The answer is to build your brand and the author does not delve into the topic which is a shame.

This is a very good book but it is not going to tell you how to be the supplier of choice in your part of the long tail. You'll have to figure that out on your own.

--Review by the author of the e-book, "How to Build and Manage Your Brand (in sickness and in health)."

I found this book to be incredibly interesting, and especially relevant because I work in marketing where the notion of long-tail products and audiences have become increasingly more important. Definitely worth a read!

Facts based analytics across multiple industry, great insight into why customers behave that way. Have good application in the insurance industry where distrbution cost is also so low with negligible inventory.

The ideas introduced in this book are revolutionary. A lot of the concepts we take for granted because they've become ingrained in our culture, but having them explained opens your eyes to what you've seen but never noticed. This is a masterpiece and I hope history judges it that way. MUST READ.

It gave me some things to think about, but nothing in the book was "ground breaking" news.

I think he is going to wake up some business managers,advertising executives, and others just out of touch with the way consumers spend time, consume media, and entertain themselves.

I think this will be much more intresting to people who spend less time shopping online, using itunes, and that own a DVR.

Essential reading to understand the power of so-called "Web 2.0" which I prefer to call participative technologies. Repetitive and overlong after you get the point. But if you are a dimwit, then I guess the book's the right length.

Given that this book came out when youtube was only a few months old and netflix were yet to begin online streaming, it is a very interesting read in 2018. While the originality of the notion of the long tail is questionable, Chris Anderson presents compelling arguments and data to identify, extrapolate and examine. The long tail is clear to see in today's world and the book does a good job of examining the trends of the 2000s which allowed such a prediction to be made.

a well written and interesting look at how digital storage and technology is changing business. If you are under 30 a lot of this book will be pretty darn intuitive and if you are over then they do a good job at describing the younger generation.

Now that people can find more niche products, the market of niches is huge. "The Long Tail" offers a fascinating glimpse of how technology could make mass markets smaller while niche markets expand.

How did we get here? Online music services and Internet bookstores, with their infinite virtual shelf space, can stock every product. Brick-and-mortar shops, with scarce space, must concentrate on hits. So it's no mystery why certain Long Tail businesses - like digital music - have taken off. It's a lot more tempting to choose from 3 million songs at iTunes starting at 99 cents, compared to choosing from 60,000 tracks at Wal-Mart starting at $12.

The question is, does this lead to more aggregate sales, or merely a shift from the head of the tail (the hits) to the Long Tail (the niches)? Are Internet retailers creating new demand, or simply taking share from old brick-and-mortar businesses?

"The Long Tail" does show how niche opportunities are popping up everywhere because the Internet has enabled low-cost (or no-cost) reach into those markets. According to Anderson, software-driven recommendations - like the store's book suggestions or Netflix's movie recommendations -- rival word-of-mouth:

"Recommendations have all the demand-generation power of advertising, but at virtually no cost. If Netflix suggests a film to you based on what it knows about your taste and what others thought of that film, it can be more influential than a generic billboard aimed at the broadest possible audience."

The main ideas in "The Long Tail" have been around for years, but Anderson puts it all into context beautifully. But he overreaches by implying that Long Tail economics applies everywhere. The discussion of digital music is convincing. No doubt, iPods and downloading has driven the Long Tail in music. The reasons are obvious: people prefer portable songs for 99 cents instead of paying $18 for a CD with one or two good songs.

But digital music is different from other products. Downloading a song for 99 cents is an impulse entertainment purchase. Does the Long Tail apply to books equally? Will students buy more textbooks simply because more titles are available? Will fiction readers buy more mysteries and discover new authors simply because a recommendation for them turns up on the store?

Anderson declares blockbuster economics obsolete. But in the film and book worlds, the hits still rule. The Harry Potters and the Da Vinci Codes sell more every year. Isn't it ironic that "The Long Tail," a book about the death of hits, is a monster bestseller? The Internet hasn't repealed the 80 / 20 rule yet.

These quibbles aside, I recommend "The Long Tail." It's the best business book I've read in the past 10 years. You might not agree with everything in it, but it will get you thinking. If you're involved with content, retailing, or advertising, it's a must-read.

Note: The review that follows is of the revised and updated edition of a book that was first published in 2006. It offers essentially the same information and insights except that Anderson has added a new chapter on marketing, one in which he explains "how to sell where `selling' doesn't work." More about this chapter later.

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 when The Long Tail was first published 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.

With regard to the new chapter, Anderson devotes much of his attention to online marketing and suggests that critical issues to address include these:

Who's influential "in our space (and how we know)"
Who/what influences them
How to get Digged
Effective blogging
Using beta-test invite lists
The art of begging for links
"Link bait" (e.g. stunts, contests, gimmicks, memes)

How to view the Web? "Forget it as a marketplace of products, and instead think of it as a marketplace of opinion. It's the great leveler of marketing. It allows for niche products to get global attention. Most products will be sold offline, as they always were. But in years to come, more and more products will be marketed online, taking advantage of Web methods to fine-slice consumer groups and influence word of mouth more effectively than ever before in history. Not all industries lend themselves to an infinite variety of products, but all industries have an infinite variety of customers. Finally we can treat them like the individuals they are. It's the sunset of the thirty-second spot."

There are several reasons why Anderson believed there is a need for a revised and updated edition. Here are two. Because the earlier version became a bestseller, it attracted lots of attention, generating an abundance of discussion of his core concepts. Also, the process of adopting his ideas (many of which at first seemed counterintuitive, if not precious and naive) was complicated by the globalization of culture. Focus shifted to distributed audiences around the world. Anderson was asked for additional examples of Long Tail effects outside the digital realms of media and entertainment. He certainly could not cover all of the extensions in fashion, travel, organic and "artisanal" food, and even alcohol as indicated by -- to cite one example -- Anheuser-Busch's embrace of niche beers, the establishment of Long Tail Libations, and the increased number of beers from 26 brands in 1997 to 80 in 2007. Given the fact that change continues to be the only constant in the global business world, think of this revised and updated edition as only the latest update on some Long Tail developments thus far.

Presumably the tail will continue to lengthen in months and years to come.

The Long Tail, by Chris Anderson

Review by Matthew Wayne McCabe

I just finished The Long Tail, by Chris Anderson. I’ve heard that it is the business book to read for a very long time. I devoured it. I’m usually a slow reader, but I consumed most of this book on my first day.

If you haven’t read it or heard of it, it’s pretty easy to give it away. The Long Tail is a graph of sales. The popular “hits” are high on the left, while everything else goes down and to the right. You’d think it’s barreling toward zero, but it never quite reaches it.

This same graph shows up time and time again with all things popular—books, movies, video games, and every other “thing.” If it can have a hit, the sales are graphed out with the Long Tail.

As a writer, this way sobering. When you realize just how many things are available, the chances that you will succeed plummet. For example, even the bad movies on Netflix cost a lot of money to make. Will they make their money back? Maybe given 30 years on the market. Maybe.

Or take books as another example. This is a matter near and dear to my heart. I think of myself as a writer. There are over 100,000 new books released each year. Making money in that market is like winning the lottery. You don’t race home with a lotto scratch-it and tell your family that you’re all gonna be rich. You probably won’t be.

The middle men are gone or going away. I can write my own book. I can produce my own movie. The question is: should I?

You can probably see the problem here. Any creative endeavor is expensive—either in time or cash. An author can take three years to write a book. He, too, can join the ranks of 2 million others on the store.com trying to make a buck. If you compared the royalties to expenses (including the time spent), the return is not that great.

Sure, there are a few break-out hits. Just like there’s somebody that wins the lottery. Do you count on it? Nope.

I read the book voraciously, hoping to get an answer. I was disappointed when the answer was, “keep your day job.” When a book takes three years to make, that’s not a good answer.

The only folks who appear to be winning in The Long Tail economy are the aggregators—the the stores and iTunes of the web. We have entered a world of “winner takes all.” Sure, there’s a market for your zombie-vampire love story, but will you ever make your money back? the store will.

Carl Friedrich Gauss and Vilfredo Pareto both gave their name to a statistical distribution. The Gaussian distribution, or bell curve (also known as the normal distribution,) reaches its peak at zero and quickly falls off towards plus or minus infinity. The Pareto distribution, sometimes referred to as a fat tail, heavy tail, or long tail, is an inverted J-shaped curve that approaches the vertical axis and more or less parallels the horizontal axis, converging only slowly towards zero. The normal distribution is widely used in statistics and in the social sciences, where it provides a simple and workable model for a wide variety of phenomena. For example, Adolphe Quetelet observed in the nineteenth century that the size of young men measured for conscription followed a normal curve; he then collected data on many other traits that were normally distributed, and applied his theory of the "normal man" to psychological and moral matters as well. More recently, Charles Murray wrote a controversial book titled The Bell Curve that showed IQ scores in a population following a bell-shaped normal distribution.

The Pareto distribution, which is mathematically less tractable, also coincides with many social and economic phenomena. Originally used by Pareto to describe the allocation of wealth among individuals in a given country, it also applies to the size of cities, the occurrence of words in a text, the value of oil reserves in oil fields, or several stylized facts in finance. Indeed, "fat tails" have become a widely used concept on financial markets, where several popular authors (from Benoît Mandelbrot to Nassim Taleb) have pointed to their many applications. Analysts who use standard statistical techniques based on the normal distribution typically downplay the risk of catastrophic events or "black swans", which "fatten" the tail of the distribution curve. In The Fat Tail: The Power of Political Knowledge for Strategic Investing, political scientists Ian Bremmer and Preaton Keat go beyond the field of finance to promote the integration of social and political factors in risk analysis and strategic planning.

So The Fat Tail was already taken as the title of a bestseller book, and technology analyst Chris Anderson had to find another catchword to describe a similarly shaped curve. The rare events which fatten and lengthen the tail of his distribution are not catastrophes or unpredictable occurrences, but sell figures of rare-to-find items or niche markets that were not formerly tended by traditional distributors. Online distribution has brought these non-hit products into the ambit of commerce. The digitalization of music and, now, of books, has further increased the sale of relatively obscure or outmoded material, pushing marginal production and distribution costs virtually to zero. In the end, everything that can be transformed from an atom to a bit, will be. The result, Anderson argues, will be a profound change in our popular culture. The niche, the obscure, and the sub-genre will gain ground at the expense of the hit, and the top dogs of mass culture will have to give way to the underdog, who will be able to find and even produce her own content.

The book grew out of an article in Wired, which attracted considerable interest and convinced the author to couch his idea in more detail. It is not merely an extended magazine article, and there are few lengths or repetitions. The presentation follows a logical path. It opens with the opposition between blockbusters and niche markets, then details the concept of the Long Tail and its emergence along with e-commerce and digital content. It provides a simple theory of Long Tail markets ("make it, get it out there, and help me find it"), introduces a few original concepts ("filters", "Pro-Am" as in professionals and amateurs, the "Short Head") and borrows other notions from standard economics (inventory costs, network effects, price differentiation). It closes by describing the new era of unprecedented choice unleashed by the Internet, and offers a few lessons for managers and entrepreneurs.

The book doesn't fit squarely into the popular economics category or the management book corner. Although Anderson emphasizes his data analysis and links with academic research teams, he skips the technical parts and doesn't address methodological issues. He makes little reference to standard economics, maybe because, as he underscores, economics has so far been concerned with relative scarcity, whereas The Long Tail heralds the entry into an age of abundance and unlimited supply. Anderson confesses he didn't have access to the store sales data: in fact, the store's statistics are one of the industry's best kept secret, although researchers were able to reconstruct some series through reverse-engineering. Conversely, most of the hard data offered by the book relies on the music downloads of a single company--Rhapsody--that became completely overshadowed by iTunes. The Long Tail doesn't offer new management tools or business lessons from corporate tycoons; rather, it presents some evolutions brought about by new technology and innovative business models by grouping them under a single catchphrase.

The author doesn't claim credit for creating the concept: Jeff Bezos did, when he established the the store portal in 1994, and Google CEO Eric Schmidt similarly made the notion a central tenet of his business strategy. The idea hit a cord with web entrepreneurs because it provided a simple way to explain a corporate strategy to business investors who were willing to buy into the narrative of unlimited growth potential. Chris Anderson provides an interesting story of the foundation of the store.com, explaining how Jeff Bezos went from identifying a business opportunity to building a corporate empire out of it. Asked by his hedge fund manager to find Internet business opportunities, the young Bezos made a list of all the things that were sold remotely. Apparel was number one, but "you didn't want to do apparel, even though it was the best category, because apparel you could do very effectively through catalogues and through stores." Books were at the bottom of the list, but they had many things to speak for them: the potential demand for published books vastly exceeded the storage capacity of brick-and-mortar retail or the size of mailing listings; each book was identified by an ISBN code, which saved data in a time of sparse capacity; and their distribution was handled by just two wholesalers, which had warehouses strategically placed around the country to serve any needs.

Interestingly, The Long Tail doesn't belong to the long tail of published books: as a bestseller, it achieved massive sales figures, and featured in the peak part of the distribution. Books that aim for the stars and target the mass market tend to have different characteristics than long tail sellers. They use simple language and colloquialisms. They are focussed on a single idea, which provides a lense to interpret a wide variety of phenomena. Their title offers a catchphrase that aims at entering into everyday language (from "black swans" to "tipping points"). They use cross-reference to other popular books, in the hope of joining the bandwagon and achieving similar bestseller status. Among the books quoted or summarized by The Long Tail are the following blockbusters: Fooled by Randomness, The Black Swan, The Wisdom of Crowds, The Rise of the Creative Class, and Republic.com. The book visibly positions itself alongside this cohort of "short head" hits.

Last, Chris Anderson used marketing ploys and viral techniques to increase his sales and impact. Following his Wired article, he published a blog and gave many lectures with the same catchphrase title, creating a core follower group and a spirit of expectation. He made sure the corporate examples he gave were congruent with his approach, and gained a lavish endorsement by Google's CEO. The publication followed the usual pattern of hardcover, paperback, bargain price, updated edition, as well as Audiobook and e-book declinations. The conclusion of The Long Tail opened the way for his next hit, which focuses on 3D printing and custom manufacturing. These marketing tricks are usually lost on me. I tend to shun bestsellers, and I do not belong to the technology savvy. But I was seduced by the firesale price of my second-hand copy, and devoted a couple of hours to its reading. I was not disappointed, nor was I enthralled by it: hence the three stars.

Anderson is no novelist. And thats a plus here. Everything leads leisurely yet just concise enough up to Chapter 14 where the reader gets delivered very clear rules. The acceptance of those will be high exactly because of the method Anderson uses to derive this rules in the 200 odd pages before that, all worthwhile to read. This deviates refreshingly from so many business books that establish the "key points" at the end of each chapter which just makes it hard to reference back to them. The style is reminiscent of a TED talk. Every illustration (or slide if you want) brings home exactly the key point that will sink in better if seen in a picture. This book exists as audiobook and as summary and exactly for the points mentioned above I cannot recommend either format but rather just the book. Some may wish for more industry examples (which are provided, yet short) since Anderson uses mostly the music and sometimes movie industry as illustration of the developments and predictions throughout the book. This seems a good choice since the author himself is interested, mostly as a very educated consumer it seems, in this industry and it does make the story more comprehensive overall. In summary simply a must read, especially for bigcorp that may struggle most with this accelerating yet fascinating development of markets and the immense power of choice shifting to whom they are supposed to serve, you, me; in short, the consumer. That "The long tail" made number 1 on Chinas nonfiction list should make US and especially European companies prick their ears....
PS: The additional chapter inserted in later about Marketing integrates naturally into the text. PR specialist and communicators should read it most. Anderson's take of the changing role of these corporate branches from being the "loudspeaker" to a more radar-like role enabling everybody to communicate is for now an option. Perhaps later a must.

This book makes an important albeit, perhaps, obvious point. It is something that most people younger than a certain age instinctively understand.
The long tail in the age of Internet is a model where abundance and endless variety is available and can be found and filtered. Costs being near zero this long tail of goods - although the book clearly focuses on music and film - is a revenue stream equal to or superior to the head, which in mainstream parlance is the hits or what is available in a typical retail outlet. The book was initially instigated when author Chris Anderson, who at the time edited Wired magazine, was meeting with someone at a company called Ecast and was surprised to find how deep the sales `tail' extended. That is, how much obscure titles sold in aggregate. Also, the title of the book stems from the type of curve representing powerlaws an example of which is linguist George Zipf's observations on frequency of words' usage (and many other things). Note: clearly an obscure product would not sell as much as a well-publicized or mainstream one, but in total the sum of available non-mainstream `long tail' products would match or surpass their better-known cousins. Now imagine a business (on the net) that can supply an infinite choice to its customers not constrained by what page 94 calls the "tyranny of the shelf."
Incidentally, and as an aside, pages 90 and 91 taught me that there are no atoms in bits - something I had believed was unimaginable. The author makes mention of how one can reduce atoms to zero as well as getting rid of atoms. I didn't know what to make of it and had to ponder the physical reality of it.

Here are the secrets to the Long Tail business:
1- Make Everything Available
2- Help Me Find It

Don't panic. In the model described costs are near zero. Traditional economics are placed on its head. As the author reminds us economics is the science of scarcity, but while many things like money and time remain scarce the shelf space or incremental cost of the net are approaching a cost of zero.
The principles are focused on CD (music) and DVD (film) likely because it is still the dawn of Internet and the available data is limited. Still, at the book's end there is a perfunctory attempt to go beyond the aforementioned markets. Having said that, still half the non-music and film examples are Internet-related. What is more, likely partly due to the data and the industry and partly due to the author's location the data, if not the conclusions, is US-centric. It is still universally applicable but Yahoo, Rhapsody, Netflix are all USA-based. These are several of the main companies the author cites as case studies.
Anderson thinks that this model not only supports his central thesis, but also proclaims the end of the era of central command and control. Not so fast, he should check who owns most of these Internet bits and bytes assets. The answer is the same moguls and conglomerates that own everything else. More importantly, the medium is now the centre. Never mind. He makes a point about fragmented and decentralized micro niches being the end of hits and the mainstream.
The concept discussed is really a simple and observable one that the author takes to in detail. Occasionally it is inarticulate and occasionally it is self-servingly elongated. Ultimately, it is not improbable to see how it could have been an article (in Wired magazine?) or a Blog post (which it once was) given its data, theme and conclusion.
Finally, I bet former Google CEO Eric Schmidt is misquoted from the company's first shareholder's meeting where he did not say, "we were able to capture very large and historically undeserved businesses..." or perhaps he was not!

Fascinating thesis in this book. Interesting to think this is the first time in history possibly, with the invention of the internet and with online shopping, we have inventory that isn't limited by physical space. Stores are limited by shelf space. But there's no shelf space to limit selection at Netflix, for example. So, there's more room for niche products. Companies can make a nice profit on those niches, or the long tail in a graph detailing products available. Learned in an MBA text on marketing that the longer a market has been around, the more it splinters into segments. It's great that companies can now make $$$ on the segments, when they don't have to pay for a bricks and mortar store to carry everything. It means more variety for the consumer to meet our niche interests. A splendid book which has many applications and will cause you to think how it applies to your business.

bought this book long ago...and decided to read now to see how accurate Chris theory can hold...and the truth is that it is not how long it can hold..it is something we often overlook..business, inventory, especially void needs to be filled but we often in the past and even now overlook..uber, fare compare are the business platforms that focus on the long tail...matters/products/ideas we do not "care"after they were initially introduced..worth the read for us to be more alert what products we already have, are being blindsided.

In classic economics, there are markets and market forces, and these interact in known or predictable ways. However, perhaps, just perhaps things are different now. The widespread use of the internet, and particularly trading, has redefined the market place and market trading. The broad thesis is that we no longer have just bricks-and-mortar stores (shops to you and me) that stock items that are likely to sell. Now new trading methods enable very slow movers not only to be sold, but to be WORTH selling if the market place is large enough.

Chris Anderson uses examples from different market sectors, and especially examines items where selling can take place with little stock sitting on warehouse shelves. In entertainment (music and films), the technology is available to create physical items to sell when an order is placed, and in these markets (and increasingly in books as well) items are not always shipped, but transmitted digitally. The can be almost no cost in holding items in the selling inventory - and with physical books, the technology of print-on-demand can mean this same principle applies here.

No longer is the choice limited to the top 50, or even top 1,000, but there is a demand for items further away from the `hits' - extending a long way down "the tail" to include products that were hitherto unavailable anywhere. This means more choice, but the crucially what is available is easily found. Such tools as customer recommendation even generate extra sales, with "customers who bought X also bought Y" suggestions.

The figures behind the theory are sometimes speculation, and more investigation is needed. However, the ideas are refreshing, well explained, and are a supreme example of unintended consequences at work.

In the USA, 20% of the population are more than 8 miles from a bookshop and 8% are more than 20 miles from a bookshop. This is part of the large untapped demand that long-tail selling can open up. Not only do `hits' sell (the traditional approach for pile-`em-high and sell-`em-cheap outlets), but that there is plenty of profit in the niche market that is the long tail.

Anderson even talks about how the `long tail' for music is not really a simple long tail, but a plethora of long tails, by genre. When is a long tail not a long tail? Why, when parts of it are themselves heads of niche markets, subdivided by genre, of course! Anderson makes his points well and this fairly easy read will explain all better than I can in a few short words.

Peter Morgan, Bath, UK ([email protected])

I am one of those annoying people who keep magazines around because every-time I look through them I find something new, something that, with a different perspective I see new opportunities or relevance.

The Long Tail is a Book like that. There are few books that I will read, re-read and highlight, then listen to the audio-book of. Most are fiction and are purely for entertainment value. The Long Tail, however is packed so tightly with information relevant to the myriad topics in which I am interested. As a result I continue to retrace chapters, sections, and paragraphs for golden nuggets of information. I have also become that annoying person who references the 'latest book I'm reading' in a conversation or e-mail and notes a reference that is topical.

I am in the Home Furnishings Industry, specifically I am a furniture designer. The Long Tail provides a plethora of data and insight into the emergence of digital dominance in any media that can be converted from physical to digital from music to movies, to software. It is more difficult to apply this digital paradigm to my industry. However, that isn't to say the digital domain will not and hasn't already become a crucial factor in the Home Furnishings Business. 15 years ago importing furniture from China was considered a non-threat to the North Carolina 'good ole boy' network of manufacturers. 5 years later they woke up to the 'crisis' of their businesses being undersold by equal or superior goods. 15 years later, nearly all domestic furniture factories are shuttered and imports from China as well as a wide swath of South East Asia, South America, and 'Eastern' Europe have become available to US consumers.

As I continue to review the book, I continue to consider opportunities for growth in my industry and applications for the rules of the Long Tail.

This is one of those transformational books that introduces and elaborates on a new and counterintuitive paradigm - one of great significance in today's rapidly changing economy.

According to Author Chris Anderson, the essence of the Long Tail concept can be summarized as follows: "Our culture and economy are increasingly shifting away from a focus on a relatively small number of hits (mainstream products and markets) at the head of the demand curve, and moving toward a huge number of niches in the tail". He goes on to write, "...the true shape of demand is revealed only when consumers are offered infinite choice".

The point is that new technologies are increasingly making it possible to cost effectively offer consumers something approaching limitless variety. In the past, when, due to costs, consumers were presented with limited variety, it made sense to aggressively manage product selection in the direction of "hits", in effect choosing on behalf of consumers. If, however, increasing choice does not increase cost, then pruning the niches becomes unnecessary and ultimately counter productive. Indeed, when the new technology assists consumers in filtering the complexity of limitless choice, the finding is that the aggregation of demand in the niches approaches that which exists in the A items or head of the demand curve.

In making the argument Anderson identifies six themes of the Long Tail Age as follows:

* In virtually all markets there are far more niche goods than hits.

* The cost of reaching those niches is now falling dramatically.

* Consumers must be given ways to find niches that suit their particular needs and interests.

* Once there's massively expanded variety and the filters to sort through it, the demand curve flattens. There still are hits and niches, but the hits are relatively less popular and the niches relatively more so.

* Although none sell in huge numbers, there are so many niche products that collectively they comprise a market rivaling the hits.

* Once the natural shape of demand is revealed...it is far less hit driven that we have been lead to believe. Instead it is as diverse as the population itself.

Economic viability of the aggregate niches that populate the Long Tail depends on major reductions in the cost of offering increased choice to consumers. Most of the book's discussion deals with this at the distribution level, where choice has typically been restricted by inventory carrying costs, shelf space, etc. However, the principle is equally valid at the manufacturing level, to the degree to which process improvement can meaningfully lower the cost of deploying exceedingly diverse and ultimately mass customization product lines. Indeed, the chapter entitled "Coda: Tomorrow's Tail" talks about manufacturing and the ultimate explosion of the Long Tail that will follow from production technology "capable of manufacturing almost anything in lot sizes of one".

Welcome to the future.

ABOUT THE BOOK
This is one of the best seller books of the last decade. This book analyzes e-business as a branch and its influence to "regular business".
The main idea of ​​the book - the more different and niche products are created and sold in the interned the longer the retail is growing. The tail causes bigger amount of incoming "players" and a wider range of product availability.

Book from the very first pages involves you with interesting analysis and observations. The first few chapters of the book are about the electronic market analysis where author comes with the conclusion that in e-world Paret's Law (80/20 rule) is slightly different and it becomes 98% rule, where 2% products are known as hits and sold in thousands of units, while the remaining 98% of the production of individual units are sold only a few times. Author provides some charts (Rhapsody, Netflix, the store offered products analysis). Author points out that the most popular market goods are only 2 to 5 percent of the whole offer of goods. The rest mass of products are bought a very little quantities.

Nevertheless, e-platform enables manufacturers to increase the marginal cost of supply without the need for additional storage, packaging and other physical attributes specific to the regular business. According to the author e-platform is an excellent medium for the most radical and unexpected ideas that can be sold.

The following chapters provide detailed description of hit and nonhit product types. The book provides detailed analysis of the last decade trends in the music publishing industry. you can find music artist albums sales drops and causes of changes in the publishing business with new technology (iPods, cell phones) empowered to broadcast music in a wider range of channels.

Further chapters describes the e-business models which are composed of the following types: a new generation of producers (the wikipedia phenomenon, e-publishing, remixes), the new market (product placement by the help of aggregators), the new market consumers(indie music listeners, low budget movies watchers)

to compare e-business and non e-business author compares e-business retailers business branch. Here author finds differences between 1 inch price strategy of shelve in retailers shop and immense e-business platform.

The last chapters of the book sums up the world of e-business niches and its culture.

INTERESTING EXTRACTS

The author presents three factors of the long tail that enable the market to receive non mass-produced products. But for that to happen it is important to happen an economic reasons - reduced cost of to reach niche market. If this assumption is implemented then the follows these long tail factors:

Democratic means of production (eg personal computers)
Consumer cost savings while democratizing the distribution (eg the Internet)
Connection of supply and demand (eg Google search, iTunes recommendations, blogs).

Business aggregators are divided into five categories:
* Physical goods (the store, Ebay)
* Digital products (i Tunes, iFilm)
* Advertising / services (google, craiglist)
* Information (google, wikipedia)
* Community / user-generated content (MySpace, Bloglines, Facebook)

Nine rules for success in the long tail aggregator:
Reduce the cost of the product
1. Move reserves inwards or outwards
2. Let the consumers to do the work
Think of niche
3. Not everywhere fits the same distribution method
4. Not everyone fits the same product
5. Not everyone fits the same price
Reduce the control
6. Share the information
7. Think "and" but not "or"
8. Let the market do your work
9. Understand what power has philosophy "free"

PROS
many business cases
comprehensive research based information
very few deviations from the topic

CONS
fast out of date information. Many of the provided cases are "archaic".

RECOMMEND
Compulsory reading for everyone interested in e-business and niche marketing.

This is essential reading for anyone involved in E-business. The author's analysis provides thought-provoking material for designing a modern business model or distribution.
The Long Tail provides a visionary account of business and modern culture. Its analysis and lessons are instructive for anyone looking for an understanding of how to compete profitably as technology is transforming markets and businesses into niche providers. It provides good examples of companies which emerged according to this theory (consciously or unconsciously), validating the author's paradigm.
The author's theory, while providing a sound analysis of the forces at play in the market, has its limitations. It is not clear how some more traditional types of business will follow this model, or whether the market will ever evolve to the 98 percent rule, even in the Internet-based trade. More likely, there will always be mass market segments along with this model.

Anderson's book presents an engaging overview of the Internet-based world of commerce. As he says, instead of chasing a million people to buy a limited set of products, we now offer a million products to one person. From my small home, I can access dozens of cable stations (more if I'd opt for premium packagess), millions of books via the store, and thousands of movies through Netflix.

Information economics means that I can sort through these huge numbers to find what I'm likely to enjoy. Information gets dispersed through voluntary reviews (like this one)and through computerized suggestions ("viewers who liked this movie also enjoyed...")

Anderson's book compares virtual shopping with brick and mortar stores, emphasizing that what we're buying is choice and information. Netflix and the store give us access to movies and books we can't find anywhere else. And online can introduce us to books, movies and music we would never find otherwise.

I only wish Anderson had been more critical of the phenomena he describes.

Watchdog sites can be extremely helpful. I use them myself. But they can also do harm. Writing on citysearch, one disgruntled customer criticized the dog lounge where I've been a regular customer. There's no way to gauge whether one negative will overcome the many well-deserved good reviews this place has gained. One author was hurt because I gave his book only 3 stars: he claimed I had been responsible for a sales slowdown. Me? I doubt it. But who knows?

Second, Anderson's discussion of wikipedia raises questions about how far we can take the Long Tail. Anderson argues (p 70) that "Your odds of getting a substantive, up-to-date, and accurate entry for any given subject are excellent on Wikipedia, even if every individual entry isn't excellent."

Even if the odds are "excellent," the problem is that you may not be able to evaluate the quality of the particular entry you select, just as you often can't evaluate the accuracy of comments on a consumer review site. After all, if you're looking up an entry in wikipedia, chances are you don't feel you're an expert.

For recreational use, that's fine. But I agree with universities who have banned the use of Wikipedia among students.

Anderson says your odds of finding a quality entry are higher on Wikipedia than in Britannica simply because the number of entries is higher. I believe the reality is that you're more likely to find an entry about a topic on wikipedia, because more topics are covered. So let's say you seek information on Topic X, which Britannica ignores. You are more likely to find entries on Wikipedia. The odds that the particular entry you find will be of high quality..that's a different story.

Finally, I can't help contrasting the responsive, targeted, interactive style of Internet phenomena with the infratstructure that still dominates much of our lives. On page 184, Anderson notes that we're finding "tribes" based on shared interests, transcending geographic location. Yet so many features of life depend on location. Health care, credit cards, insurance, education and justice systems all remain dinosaurs.

But we have to give Anderson credit: he gets us thinking about these things. I already have homes on the Internet and this book helped me recognize the directions I'll need to take in future. I can't imagine an Internet marketer who would not want to read this book.

Hits are great for business. Wal-Mart carries a very small number of CDs and books compared to the number of titles that are published each year. And if a CD or book isn't selling, it's gone. They only have room for the gig hits.

The only problem is that the hits today rarely sell in the quantities they used to. People are finding the products they really want, ant the net is the facilitator. Our society is quickly leaving the mode of only buying the Billboard top 40 and the NY Times bestseller books. This brings forth a new business model.

the store also sells the hits, but they carry thousands upon thousands of books and CDs that are not popular. But somewhere out there, someone wants a book on the most obscure subjects, or a piece of music that few would ever venture into. the store has lowered the cost of carrying nearly all the available titles, so even if something sells one copy a quarter, they can still make money on it. Multiply this times millions of titles, and you have a big aggregate revenue number.

Downloadable products, such as mp3 files and ebooks have almost no cost to carry and list. These companies have huge margins and huge inventories.

Unfortunately, this book is most helpful to people who can build a business that follows this model. Carry "all" the products in a market, and you will increase your chances of success enormously. If you are creating a product that occupies the Long Tail portion of the market, this book won't help you sell more product. For that, read books on viral marketing. You'll need people to build a buzz abot your product. The Long Tail is a way for the merchant to make money, not really for the producer of any given product.

The Long Tail of economics only works as a model for "stores" that generate huge volumes of traffic. Traffic that will cover even the most obscure products in the catalog. Without massive traffic, you lack the customer diversity necessary to power the model. It could take millions of dollars in advertising and marketing to build up your traffic base.

Pick up a copy of this book for many examples of this phenomenon. It's a very engaging read, even if only a source of better understanding today's changing mass market.

Dubbed by editor-in-chief of Wired Magazine , the Long Tail is

"The theory of the Long Tail is that our culture and economy is increasingly shifting away from a focus on a relatively small number of "hits" (mainstream products and markets) at the head of the demand curve and toward a huge number of niches in the tail. As the costs of production and distribution fall, especially online, there is now less need to lump products and consumers into one-size-fits-all containers. In an era without the constraints of physical shelf space and other bottlenecks of distribution, narrowly-targeted goods and services can be as economically attractive as mainstream fare."

Anderson discusses how, in today's society, how and why traditional "brick and mortar" outlets are losing ground to online retail. On the surface, the Long Tail is about how it is easier to buy hard-to-find items on the internet. But Anderson digs deep to analyze why. He uses the store, Netflix, and Rhapsody as examples.

With physical stores, there is limited shelf space. So Wal-Mart and Best Buy can only stock CDs that their customers will buy. Looking online, however, Anderson has discovered that all CDs sell. It is not worth it for Wal-Mart to carry an obscure CD because the chances are high that it will merely sit on the shelf collecting dust. From the "brick and mortar" aspect, it is vying for shelf space with commercial artists, like Britney Spears and the Cheetah Girls.

On the other hand, 20% of the store's sales are from books which sell 10 or less copies. There is a market out there, its just so small that the economies dictate that physical stores not carry them. Even more astounding is the fact that with online music services such as iTunes and Rhapsody, where there is no "physical" song and its all just bytes or whatnot, there are no carrying costs, so the gamut runs wider and longer on what's offered. This is why companies that offer more will be successful, even if each product only sells a few units.

I enjoyed Anderson's writing style. He fairly presented both sides, and in addition, interviewed many companies to get different interpretations and perspectives. It is intelligent, without snobbery or pretense, which I applaud, and therefore highly recommend this book.

In "The long tail," Chris Anderson provides a unique explanation for the strong economic behavior of ecommerce retailers. The author begins by reviewing mathematical curves that characterize the relationship between two variables: number of times an item has been purchased (on y axis) vs. items available for sale (rank ordered according to "popularity of item" on the x axis). In traditional retailers (bricks and mortar), the curve follows a power law (e.g. y = 1/x)...but x is limited by the physical size of the store...

In contrast, the sales curves for modern ecommerce businesses (e.g. the store, rhapsody, itunes) take on a different shape: x is much larger--nearly infinite--and as the sales curve flattens out to the right, it drops down much more slowly than one sees for brick and mortar businesses (the tail of the curve is flat or "long." This effectively means that there is "surprising" demand for "niche" products that you would never see in brick and mortar stores (which cannot afford to stock the same number of goods). the store, itunes, etc. are effectively able to match demand for niche products with supply of niche products using powerful search tools and (in the case of the store) third party vendors managing inventory.

Interestingly, Matthews points out that Sears was a pioneer in taking advantage of the long tail model of business economics. Certain businesses (ebay, the store, itunes) have taken the long tail phenomenon to a new level by using the internet to lower their fixed and marginal costs...and by creating tools that effectively match buyers and sellers for their millions of niche products available for sale. After reading this book, the most interesting question that comes to mind is whether or not the the store kindle will create the same economic wonders that itunes provided to apple via the power of the "long tail." The next 5 years will tell us...

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.

Niche markets. Filtered and unfiltered screens. Aging versus state of art retailing. Limited versus unlimited inventory. Popular and unpopular tastes. Bricks and mortar versus digital competition. These are the key concepts the author conveys on the current state of retail marketing.

This book attempts to explain the new art of marketing through the use of the Pareto curve whereby the highest-selling products appear at the beginning of the shortest and highest part of the curve, and the lowest-selling products appear in the longest and lowest part of the curve. By focusing his examples in the entertainment industry and search engines, the author brings the reader up to speed on how digital marketing, via internet and Personal Digital Accessories , are becoming the new standards of commerce. Most of the book centers on "the long tail" part of the curve where online retailers can offer niche products that mass- market, bricks and stone retailers cannot offer due to physical and monetary limitations.

The book is geared to existing and prospective digital retailers, gives them adequate perspectives of what has been an emerging, and now dominant form of merchandising. It also offers some ideas on future digital trends which will probably become commercially viable in the forseeable future.

My major reservation with reading the book is that it seems to be drawn out too long and quite repetitive in explaining the concept of digital marketing. In that sense, it may dull the reader's reading appetite.

Like other reviewers, I found myself skimming towards the end, when the author starts to repeat himself. However, throughout most of the book, by attention was sufficiently captivated. If nothing else, it shows how people a decade younger than me are far surpassing my generation in terms of harnessing the internet.

When I was a teen, I was interested in non-mainstream music. The only way to discover this music was word-of-mouth from friends and peers, buying magazines like Alternative Press, and making the trip across town on the bus to shop at the independent music store. Nowadays, those interested in niche genres of music have MySpace, peer-to-peer filesharing, etc. You don't have to buy magazines, or travel for miles to find the music on the shelf. It's as close as your computer screen. Kinda makes the cassette dubs we made in my day seem like child's play.

The ramifications of sophisticated technology at next-to-nothing cost is a prevalent theme in Anderson's book. However, there are glaring omissions, and a problem in format. For example, he makes a big deal about how a quarter of the store's online book inventory sold cannot be found in even the largest book superstore. Before you strike the death knell for the bookseller industry, there's one name the author is remiss to leave out: Oprah Winfrey. For all Mr. Anderson champions consumers as the new tastemakers, she is the ultimate tastemaker, like it or not. And her recommendations are through her television show, not the cutting-edge technology channels mentioned in the book. Furthermore, those books can be found in any superstore, not just online.

Formatwise, a lot of the tedious repetition could have been weeded out, and replaced with more focused chapters. I would have liked to have seen chapters that only dealt with one form of media (one for music, one for books, one for television, etc). This would have been preferable to the how-many-ways-can-I-tie-a-scarf approach.

Note: I recently re-read this book, deleted my earlier review, and how share what follows.

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.

Chris Anderson paints a picture of how very different today’s generation views information and how dead broadcasting is becoming compared to the vast small niche Internet driven content that is available. The demand may not be as great but that is because consumers have so many more options. I agree with Chris’s premise as you can see it in how Netflix, Hulu and the like have sprung up to be the on-demand suppliers of programming on your own schedule.

Chris presents a unique concept of long tails which is limited quantities of vast items.
Instead of charting top sellers you can see how content has a long tail of small amounts of users. I see that my generation likes the option of unlimited variety of the independent or none chart toppers. This is a great business model as they do not have as much over head in stock. It also supports the on-demand/just in time stocking theology that so many companies have moved to.