Chris Anderson Currently the editor-in-chief of Californian Magazine “Wired”, which he took over in mid-2001.
He wrote The Long Tail theory which first appeared in Wired Magazine in October 2004. It later became a book which was published in early July 2006.
The Long Tail Theory is Like the Structure of a Dinosaur Long Tail highlights how our culture and economy is consistently increasing by moving away from a focus on a moderately small number of mainstream products and markets at the HEAD of the demand sector, and towards a popular number of niches in the TAIL.
The Theory’s Prediction: The demand for products unavailable in normal stores are potentially bigger than the demand of products traditionally found in normal stores.
For Example: Videos unavailable on broadcast TV on any given day. OR Songs not played on the radio.
Thus: Niche Rivalling the Hits Small Markets in Goods That DON’T Sell Well Enough for Traditional Retail and Broadcast Distribution. (Niche) VS Existing Large Markets in Goods That DO Sell Well Enough for Traditional Retail and Broadcast Distribution. (Hits)
TERM= Standard demand curve that can apply to any industry from entertainment to hard goods (applies to the orange bit). VERTICAL AXIS = Sales HORIZONTAL AXIS = Products RED HEAD= Hits that have dominated our markets and culture for most of the 20th Century. ORANGETAIL= The non-hits or niches which is where the new growth is coming from now and in the future.
Traditional retail economics claim that stores only stock the “likely” hits because shelf-space is expensive.
Online retailers like Amazon and iTunes can stock literally everything. Resulting in the number of available niche products to out-number the Hits by several orders of magnitude.
Those millions of niches are the LONG TAIL – largely neglected until recently.
When consumers are offered infinite choice their feedback highlights the true shape of demand.
The Long Tail theory has proven that results have turned out to favour the so-called “smaller market”.
WHY? Because people are attracted to niches - they satisfy the hunger for narrow interests better. And either way EVERYONE has a narrow interest.
Bibliography: http://longtail.typepad.com/about.html http://www.4psmarketing.com/tag/long-tail.html Google Images