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The long tail complete
 

The long tail complete

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    The long tail complete The long tail complete Presentation Transcript

    • HOW ENDLESS CHOICE IS CREATING UNLIMITED DEMAND By: Adaeze & Michelle
    • • Wi r e d Ma g a z i n e d e f i n i t i o n of t h e l o n g t a i l . I t ’s t h e my r i a d of t he ni c he pr o d u c t s wh o s e c o l l e c t i v e ma r k e t s ha r e c a n r i v a l t he bl oc k bus t e r s .• T h e l o n g t a i l i s wh e n s e l l i n g l e s s o f mo r e c a n b e j u s t a s pr of i t a bl e a s s e l l i n g mo r e o f l e s s
    • The Long Tail: Why the Future of Business Is SellingLess of More
    • • Be f or e t he I ndus t r i a l Re v o l u t i o n , mo s t c u l t u r e w a s l o c a l . T h e r e wa s a n e a r l i e r e r a of ni c he c ul t ur e de f i ne d by ge ogr a phy .• Cu l t u r e w a s f r a g me n t e d be c a u s e of t he l a c k of r a pi d t r a ns por t a t i on a nd c o mmu ni c a t i on a nd t he l i mi t e d c u l t u r a l mi x i ng, ne w i d e a s a nd t r e nds .• T h e e a r l y 19t h e r a o f m o d e r n i n d u s t r y a n d t h e g r o wt h o f
    • • Hu bs of t r a ns po r t a t i o n mi x e d pe opl e l i k e n e v e r be f or e – c r e a t i ng a po we r f ul e ngi ne of ne w c ul t ur e a l l t h a t wa s ne e d e d w a s ma s s me d i a• I n m i d 19t h c e n t ur y s e v e r a l t e c hnol ogi e s e me r g e d. The s e t e c hnol ogi e s l e d t o t he f i r s t g r e a t wa v e of popul a r c ul t ur e .• As t e c hnol ogy gr e w s o di d t he a b i l i t y f or c ul t ur e , i de a s a nd t r e nds t o r e a c h f ur t he r pl a c e s , c r e a t i ng a gr e a t e r de ma n d f o r p o p u l a r c u l t u r e
    • MA K E I T , G E T I T O U T T H E R E A N D H E L P ME F I ND I T• Ou r c u l t u r e a n d e c o n o my a r e i n c r e a s i n g l y s h i f t i n g a wa y f r o m a f o c u s o f a r e l a t i v e l y s ma l l n u mb e r of h i t s a t t h e h e a d o f t h e d e ma n d c u r v e , b u t mo v i n g t o w a r d s a h u g e nu mb e r o f n i c h e s i n t h e t a i l .• I n a n e r a wi t h o ut t he c ons t r a i nt s of ph y s i c a l s h e l f s p a c e , n a r r o wl y t a r ge t e d go o d s a n d s e r v i c e s c a n be a s e c o n o mi c a l l y a t t r a c t i v e a s ma i ns t r e a m f a r e .• The t r ue s ha pe of d e ma n d i s r e v e a l e d
    • F o r c e 1: D e m o c r a t i z i n g t h e t o o l s o fpr oduc t i on• gi v i ng e v e r y one t he c a pa c i t y t o c r e a t e = Mo r e s t u f f w h i c h l e n g t h e n s t he t a i l .F o r c e 2: C u t t i n g t h e c o s t o fc o n s u mp t i o n b y d e mo c r a t i z i n gd i s t r i but i on• T h e f a c t t h a t a n y o n e c a n ma k e c o n t e n t i s o n l y me a n i n g f u l i f o t h e r s c a n e n j o y i t . t h e I n t e r n e t t h a t ma d e e v e r y o n e a d i s t i n g u i s h e r = Mo r e a c c e s s t o n i c h e s , wh i c h f l a t t e n s t h e t a i lF o r c e 3: C o n n e c t i n g s u p p l y a n d d e m a n d• I n t r o d u c i n g c u s t o me r s t o t h e s e n e w a n d n e wl y a v a i l a b l e g o o d s a n d d r i v i n g d e ma n d d o w n t h e t a i l = D r i v e s bus i ne s s e s f r om hi t s t o ni c he s
    • • T h e r e a r e f a r mo r e n i c h e g o o d s t h a n h i t s a n d t h i s r a t i o i s g r o wi n g l a r ge r .• T h e c os t of r e a c hi ng t hos e ni c he s i s n o w f a l l i ng d r a ma t i c a l l y a l l o wi n g t h e pos s i bi l i t y t o of f e r a ma s s i v e l y e x pa nde d v a r i e t y of pr oduc t s .• Al l t hos e ne w n i c h e s a d d u p . Al t h o u g h no ne s e l l i n h u g e n u mb e r s , t h e r e a r e s o ma n y n i c h e p r o duc t s t ha t c o l l e c t i v e l y t h e y c a n c o mp r i s e a ma r k e t r i v a l l i n g t he hi t s .• On c e a l l o f t h i s i s i n p l a c e t h e n a t u r a l s h a p e o f d e ma n d i s r e v e a l e d .
    • R u l e 1: Move inventory way in…or w a y o u t• T o o f f e r e v e n mo r e v a r i e t y , c o m p a n y ’s E .g . A m a z o n ha v e e x p a n d e d t o “v i r t u a l i n v e n t o r y ”• D i g i t a l i n v e n t o r y E .g . I T u n e s t he c h e a p e s t . T h e s wi t c h f r o m s h i ppi ng p l a s t i c d i s c s t o s t r e a mi n g me g a b i t s .R u l e 2: L e t c u s t o m e r s d o t h e w o r k• T h e wo r k i s b e i n g d o n e b y t h e p e o p l e wh o c a r e a b o u t i t , a n d k n o w t h e r e o wn n e e d s .• Wh a t u s e r s h a p p i l y d o f o r f r e e w h a t c o mp a n i e s w o u l d o t h e r w i s e p a y e mp l o y e e s t o d o .R u l e 3: O n e d i s t r i b u t i o n m e t h o d
    • R u l e 4: O n e p r o d u c t d o e s n ’t f i t a l l• O n c e u p o n a t i me t h e r e w a s j u s t o n e w a y t o b u y mu s i c . H o w e v e r , “m i c r o c h u n k i n g ” a s t r a t e gy t ha t s e pa r a t e s c ont e nt i n t o i t s c o mp o n e n t p a r t s .• T h i s i s s o p e o p l e c a n c o n s u me t h e p r o d u c t wh i c h e v e r wa y t h e y f e e l .R u l e 5: O n e p r i c e d o e s n ’t f i t a l l• Di f f e r e n t p e o p l e a r e wi l l i n g t o pa y di f f e r e nt pr i c e s f or a ny n u mb e r o f r e a s o n s .• Ma r k e t s w i t h r o o m f o r a b u n d a n t v a r i e t y , v a r i a bl e pr i c i ng c a n be a p o we r f u l t e c h n i q u e .R u l e 6: S h a r e i n f o r m a t i o n• Al l t h e d a t a o f t h e p r o d u c t
    • R u l e 7: T h i n k “a n d ,” n o t “o r ”• T h e r e i s a mi s t a k e i n t h i n k i n g t h a t e v e r y t h i n g i s a e i t h e r /o r c h o i c e .• I n ma r k e t s w i t h i n f i n i t y c a pa c i t y , t he r i ght s t r a t e gy i s t o a l mo s t a l w a y s o f f e r i t a l l .R u l e 8: T r us t t h e ma r k e t t o do y ourj ob• I n s c a r c e m a r k e t s , y o u ’v e g o t t o gue s s a t wh a t wi l l s e l l .• I n a bun d a n t ma r k e t s , y o u c a n s i mp l y t hr ow e v e r y t hi ng out t he r e a nd s e e wh a t h a p p e n s , l e t t i n g t h e ma r k e t s or t i t out .• The l e s s o n : d o n ’t p r e d i c t ; m e a s u r e a nd r e s pond.R u l e 9: U n d e r s t a n d t h e p o w e r of f r e e
    • • Av a i l a b i l i t y o f a p r o d u c t i s a l s o i mp o r t a n t i n di s t i ngui s hi ng l ong t a i l .• Fo r e x a mp l e w h e n r e s e a r c hi ng i f Fi f a 06 – a 5 y e a r ol d g a me wa s a v a i l a bl e on A ma z o n we f o und t ha t t he ga me w a s v e r y mu c h a v a i l a bl e .• Ho we v e r , wh e n we s e a r c h e d f o r F i f a 06 o n H M V i t w a s una v a i l a bl e .• T h i s i s b e c a u s e A ma z o n i s
    • • A me r i c a n Hi s t o r y X i s a mo v i e t ha t c a m e o u t i n 1998 w h e n s e a r c h i n g f o r t h e DVD o n H MV onl i ne a nd a t t he s t or e i t w a s n ’t a v a i l a bl e .• Ho we v e r , Ha r r y Po t t e r a n d t h e Ph i l os o p h e r s S t o n e (2001); t h e f i r s t of t he h a r r y p o t t e r f i l ms t o c o me ou t 10 y e a r s a g o wa s a v a i l a b l e on l i ne a nd a t t he s t or e .• Ca s a bl a nc a (1942) i s a r g u a bl y o n e of t he be s t f i l ms o f a l l t i me a nd a l t hough a n o l d mo v i e t h a t wo u l d mo s t l i k e l y ha v e a ni c he t a r g e t
    • • Br i t n e y S p e a r s i s a wo r l d wi d e gl o b a l n a me a n d i t w o u l d b e o f no s u r pr i s e t ha t he r f i r s t a l bu m t i t l e d H i t me b a b y o n e mo r e t i me r e l e a s e d i n 1999 i s s t i l l a v a i l a b l e o n H MV e v e n t h o u g h i t ma y not ne c e s s a r i l y be a bi g s e l l e r .• V a n e s s a Wi l l i a m s h a s r e l e a s e d 8 s t u d i o a l b u ms , h e r f i r s t a l b u m T h e R i g h t S t u f f (1988) w a s n o t a v a i l a b l e . E v e n o n e o f h e r mo r e r e c e n t a l b u ms E v e r l a s t i n g L o v e r e l e a s e d i n 2005 w a s n o t a v a i l a b l e
    • • Th u s t h e e c o n o mi c e f f i c i e nc i e s of de a l i ng on l y i n b i t e s w o u l d n ’t j u s t be e x t e nde d i n t he l ong t a i l b u t a l s o i mp r o v i n g t h e e c o n o mi c s o f t h e he a d , wh e r e t h e r e a r e f a r mo r e pounds a t s t a k e .• Th i s i s ne e dl e s s t o s a y a po we r f ul a t t r a c t i on a nd wi l l onl y a c c e l e r a t e t he a d op t i on of t he t e c hnol ogy .