How important is the long tail?
That’s the question being asked today by several writers and influential bloggers. It’s a question that goes straight to the heart and purpose of blogging, so let’s take a look.
It all starts with Chris Anderson’s new book The Long Tail, which argues that online sales has a great advantage through infinite “shelf space,” which traditional bricks and mortar stores do not have. The ability to market the items that sell less units, combined with the ability to sell to people who are not physically present, gives the online seller a big advantage. Think about it like this. If the slow selling stuff accounts for 30% of sales, that’s like having several extra “hot” items available all the time. Plus, that 30% has to come from somewhere, and if it’s not coming at the expense of the long tail items, it’s coming at the expense of the hot items- the head items, if you will.
I certainly buy into the concept Chris is espousing. It’s the very reason why 99% of my non-food purchases are made over the internet. Knowing that Amazon will have what I’m looking for is great incentive to start there first. That’s before you even consider the convenience and comparison benefits.
Lee Gomes at the Wall Street Journal writes in an article about Chris’s book:
“By Mr. Anderson’s calculation, 25% of Amazon’s sales are from its tail, as they involve books you can’t find at a traditional retailer. But using another analysis of those numbers — an analysis that Mr. Anderson argues isn’t meaningful — you can show that 2.7% of Amazon’s titles produce a whopping 75% of its revenues. Not quite as impressive.”
Lee goes on to cite examples of how the hot items are still accounting for the large majority of the action at such diverse places as online music, Netflix and Bloglines.
In sum, Lee doesn’t buy the long tail argument.
Chris responds on his blog, and rebuts what he describes as Lee’s haste to find flaws. He states the case for the long tail items to catching up to the hot items in the near future:
“Although I don’t discuss this in detail in the book, in the case of Rhapsody, the trend data suggests that the tail (as defined above) actually will equal the head within five years. Which is why the language Gomes cites from the book jacket is actually all phrased in the future conditional tense (‘What happens when the combined value of all the millions of items that may sell only a few copies equals or exceeds the value of a few items that sell millions each?’). I asked him to quote the jacket copy in full context, but it apparently wasn’t convenient to his thesis to do so, so he didn’t.”
Nick Carr takes a look at the arguments and concludes:
“I have no doubt that the Internet has created a Long Tail effect, making it easier for customers to find and buy rare or specialized products. Anderson’s book provides pretty compelling evidence that that’s true. And it’s important. But I’m still not quite sure if it’s really important or just mildly important.”
Nick goes on to make a very good point about the long tail- that it existed before the internet, just in a different form:
“To get a clear sense of the impact of the Net on the Long Tail, you’d need another statistic: Before the Internet came along, what percentage of total book sales lay outside the 100,000 titles stocked in a typical large bookstore? There have always been specialized bookstores, selling everything from religious and spiritual books to textbooks to foreign-language books to used and out-of-print books to poetry books (though their ranks have been pruned by Amazon and other online sellers). And there have always been small presses – literary, academic and technical – selling books directly, through the mail. And you’ve always been able to go to a bookstore and order a book that it didn’t carry on its shelves. How much of the Long Tail of books represents old demand moving through a new channel, and how much represents new demand?”
As Nick concludes, the long tail was there long before the internet. It’s probably a lot bigger now, since supply can and does affect demand. The real question, however, is whether the long tail is fully grown, or just a pup that will grow bigger over time, as Chris suggests.
Only time will tell. My guess is that it will get a whole lot bigger, since there will never again be a generation that isn’t completely comfortable with the computer and the internet. For our kids and their kids, computers are not newfangled and sometimes confusing technology. They are like telephones. They are implements to be used for a purpose.
I suspect the long tail will play out a lot like the state of communications did when telephones landed on everyone’s wall. There was communication before phones- but not nearly as much. It took longer and the hurdle was so high that the level of communication was kept in check. The effort required precluded it from growing.
I think a lot of the bricks and mortar stores are going to start feeling like letters over the next few years.
Newsome.Org 