The Long Tale: A market for the ‘less-popular’ things

The concept of the ‘Long Tail’ is quintessential of the e-commerce phenomena. This idea,  identified by Chris Anderson in 2004, recognises that e-commerce websites (such as Amazon and Alibaba) provide a wide-ranging, yet highly popular market for niche items. Essentially, brick and mortar stores do not have the capacity or the profitability to carry particular niche items. However, when compared with the online market, vendors are able to ‘stock’ these items whilst also exhibiting them to consumers. The sale of niche items is becoming a prominent market of many online stores.

GRAPH: The Long-tail graph.

GRAPH: The Long-tail graph.

The graph to the left illustrates the concept of the Long tail. In green is what Anderson defines as the the head (2004), which represents ‘hits’. As depicted, hits sell really well quickly, yet die off even quicker. In yellow is the long tail, which exhibits the niche items. Both sections are equal, yet the yellow section, or the long tail, continues to sell due to consumer demand.

A very successful example of the long tail theory is novelist Amanda Hocking. Hocking, after repeatedly being denied by publishers for her fantasy novels decided to publish and sell her novels online. Within two years Hocking had sold over 1.5 million copies of her novels and made $2.5 million (Pilkington 2012). As Anderson states, with a lack of manufacturing and logistics costs, a “miss sold is just another sale, with the same margins as a hit” (2004) and as such “popularity no longer has a monopoly” (2004). Hocking became a best-selling author without even having to publish a single page due to the consumer demand of her novel. Furthermore, as her books do not have to be stocked in stores, they can continually be bought online without the hassle of reprinting, transporting or shelving.

Another example is the Indonesian film, Raid 2: Berandal. The film is the second installment in the series by Gareth Evans and has become increasingly popular in niche markets. The Raid 2 is a gory, action-packed, foreign film starring fairly unknown actors to the Western world. Nevertheless, due to the astounding popularity of the first installment online, the second film received a wide release worldwide. This, however, was cut short due to low returns. Hopefully the film will continue to remain popular by hardcore-fans online.

Sources:

Anderson, C 2004, ‘The Long Tail’, Wired, vol. 12, no. 10, viewed 30 August, <http://archive.wired.com/wired/archive/12.10/tail.html?pg=2&topic=tail&topic_set=&gt;

Mendelson, S 2014, ‘The Raid 2′ Bombed, But Sony Deserves Kudos For Going Wide’, Forbes, 15 April, viewed 31 August, <http://www.forbes.com/sites/scottmendelson/2014/04/15/the-raid-2-bombed-but-sony-deserves-kudos-for-going-wide/&gt;

Pilkington, E 2012, ‘Amanda Hocking, the writer who made millions by self-publishing online’, The Guardian, 13 January, viewed 31 August, <http://www.theguardian.com/books/2012/jan/12/amanda-hocking-self-publishing&gt;.

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15 thoughts on “The Long Tale: A market for the ‘less-popular’ things

  1. Great explanation of the long tail effect! The examples illustrate the concept of the niche market really well. It’s difficult with the word restriction, but would of been good to read about how these niche markets are having an effect on the mainstream market i.e. how are the popular markets reacting/dealing with the increase in niche markets. Overall, very clearly written post with insightful statistics and references too!

  2. Nice references, very specific, it’s easy to see how the long tail effect applies to these cases. You’re writing is also easy to follow and understand. Overall you’re post was informative and engaging with appropriate examples.

  3. Big fan of The Raid such a fun movie. Great references that makes the concept very easy to understand and show the long tail in effect. Also love the layout of the post with the picture on the side makes it look very professional.

  4. Your explanation of the long tail concept was succinct and the examples you provided supported it very well. I have never heard of the novels or movies, however it is clear to see how successful they have been. Your style of writing is very sophisticated, great job!

  5. Very good post. I like the way you expanded on the the concept of the long tail and made sure it was clear before charging into examples. The examples you used were really good too in describing the way the internet has affected book and film industries. nice!

  6. Good example. Quick bit of housekeeping – one of your “niche”s in the first paragraph says “nice”.

    Another fantastic example of the long tail affect is the movie the Room. If you havent seen it, I suggest you do. It was pulled from cinemas after 2 weeks when it had grossed $1,800. The budget for it was a self funded 6 million.

    It was an absolute flop. But it was picked up pretty quickly as a cult classic, and now gets midnight screenings in a bunch of cinemas around the world (including in Sydney)

  7. Great explanation and use of examples to illustrate the long tail effect. Family Guy and the original Austin Powers film are also examples of this effect, being initially moderate to minor successes (Family Guy was cancelled twice) but high and consistent VHS and DVD sales led to sequels, spinoffs and reboots for both series. It will be interesting to see the long tail effect of Netflix when it enters the Australian market in 2015 and how this will affect national television networks.

  8. A good use of relevant examples, they each work well to reinforce the dynamic potential of the long tail effect and while I have not personally heard of either of them (which in itself is an indicator of the functioning’s of the niche market), it is obvious that you have done your research into their unique circumstances and successes. I think that your statement suggesting that niche ‘sales are now becoming the fundamental market of many online stores’ encapsulates the overarching notion of the long tail really well. Your writing style is clear, succinct and engaging making it both an enjoyable and informative post to read. nice one!

  9. As a person who is usually interested in niche items, online shopping is a complete revelation. Discogs which has a similar thing going on, except it has a kind ebay side to it, has completely gotten it’s hooks into me. I can get any type of music in any type of physical form in different conditions and for different prices. It’s incredibly addictive!

  10. Awesome post. Your references are perfect for this topic.Your cases show how the long tail effect works and you talk of the niche market well. I am someone who enjoys online shopping and ability to purchase the niche items is a plus for me.

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  12. Interesting examples of the long tail effect, especially online publishing, which is one i had not considered. Your points led me to further contemplate how much longer publishing hard cover books will be deemed necessary – with the industry shift currently being to purchase hardcover books online, how long until we see a dramatic shift of books being published directly to the internet and cutting out the middle man of the book itself.

  13. Very clear content to explain what long tail effect is and included statistic in the blog. Nice! Besides, I think you can talk more about the niche market compare with the mainstream market. That will be much better and have a more complete picture of the long tail effect.

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