By Mantaza Assyaed (AKA MINTY) The Long Tail
What is The Long Tail? <ul><li>The  Long Tail  is a retailing concept describing the niche strategy of selling a large num...
Before the Introduction of Long Tail <ul><li>The twentieth-century commerce has been dominated by: </li></ul><ul><li>An in...
The driving forces behind the long tail phenomena <ul><li>In a nutshell long tails emerge in an industry whenever the cost...
Rules of success for using the long-tail <ul><li>Successful long tail businesses will treat consumers as individuals </li>...
Consumers Variety of choices <ul><li>Consumers currently face the biggest explosion of variety in history. To take just a ...
The effect of Long tail <ul><li>&quot;Goodbye  Pareto Principle , Hello Long Tail&quot; </li></ul><ul><ul><li>80/20  </li>...
Who uses Long tail? <ul><ul><li>Significant portion of Amazon.com's sales come from obscure books that are not available i...
Who uses Long tail? Continued…. <ul><li>Marketing </li></ul><ul><ul><li>New Media Marketing: Building and managing of  soc...
Benefits & Drawbacks <ul><li>Benefits: </li></ul><ul><li>Increases target Markets </li></ul><ul><li>More products on offer...
The future of The Long Tail <ul><li>Things are going to be different in the future. It helps if you keep in mind a few bas...
References <ul><li>http://ministrynetconference.com/wp-content/uploads/2009/10/The-Long-Tail.pdf </li></ul><ul><li>www.nov...
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The Long Tail

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The Long Tail

  1. 1. By Mantaza Assyaed (AKA MINTY) The Long Tail
  2. 2. What is The Long Tail? <ul><li>The Long Tail is a retailing concept describing the niche strategy of selling a large number of unique items in relatively small quantities – usually in addition to selling fewer popular items in large quantities. </li></ul><ul><li>In a market with near infinite supply (huge variety of products), a demand will exist for even the most obscure products. </li></ul><ul><li>The concept was popularised by </li></ul><ul><li>Chris Anderson in an October </li></ul><ul><li>2004 Wired magazine article. </li></ul>
  3. 3. Before the Introduction of Long Tail <ul><li>The twentieth-century commerce has been dominated by: </li></ul><ul><li>An intense search for one-size-fits-all products. </li></ul><ul><li>Companies trying to predict demand for their goods. </li></ul><ul><li>Products that don't sell immediately getting pulled quickly. </li></ul><ul><li>A limited range of popular products being available. </li></ul><ul><li>The introduction of the internet and commerce has created an era of unprecedented choice for consumers. When you have a store with unlimited shelf space, you are serve the long tail part of the demand curve. </li></ul>
  4. 4. The driving forces behind the long tail phenomena <ul><li>In a nutshell long tails emerge in an industry whenever the cost of reaching niches gets reduced to a very low level. There are three powerful forces which can cause these costs to fall: </li></ul><ul><li>The tools of production become more widely available. </li></ul><ul><li>The costs of distribution are cut appreciably. </li></ul><ul><li>Some way of connecting supply and demand is established. </li></ul><ul><li>Whenever these three forces are present in an industry, look for a long tail to emerge as the driving force of commerce. </li></ul>
  5. 5. Rules of success for using the long-tail <ul><li>Successful long tail businesses will treat consumers as individuals </li></ul><ul><li>The secret to commercial success in an economy dominated by long tail: </li></ul><ul><li>1. Make everything you have to offer available. </li></ul><ul><li>2. Help people find what they want. </li></ul><ul><li>The savvy consumer is the best customer and they are the ones who appreciate and consume the long tail. </li></ul><ul><li>First time users or light users should be directed to the hits table where in over 90% of the time, they’ll find what they want. </li></ul><ul><li>Heavy users should be taken to the hits area but with recommendations and more options to explore. </li></ul>
  6. 6. Consumers Variety of choices <ul><li>Consumers currently face the biggest explosion of variety in history. To take just a few representative examples: </li></ul><ul><li>The advertising firm OMD has estimated there are 19,000 </li></ul><ul><li>variations of Starbucks coffee available. </li></ul><ul><li>Mintil International found in 2003 alone, 26,893 new food and </li></ul><ul><li>household products were introduced. These new choices </li></ul><ul><li>included 115 new deodorants, 187 new breakfast cereals and </li></ul><ul><li>303 new women's fragrances. </li></ul><ul><li>iTunes now makes available to consumers more than 2 </li></ul><ul><li>million songs which can be downloaded for listening in digital </li></ul><ul><li>format. </li></ul>
  7. 7. The effect of Long tail <ul><li>&quot;Goodbye Pareto Principle , Hello Long Tail&quot; </li></ul><ul><ul><li>80/20 </li></ul></ul><ul><li>Competitive impact </li></ul><ul><ul><li>Before a Long Tail works, only the most popular products are generally offered. </li></ul></ul><ul><ul><li>Examples: </li></ul></ul><ul><ul><ul><li>Large web business with broad coverage such as Yahoo or BBC News are threatened by smaller web sites with niche focus. </li></ul></ul></ul><ul><ul><ul><li>Blockbusters is threatened by Netflix because it offers titles that blockbusters don’t. </li></ul></ul></ul>
  8. 8. Who uses Long tail? <ul><ul><li>Significant portion of Amazon.com's sales come from obscure books that are not available in brick-and-mortar stores. </li></ul></ul><ul><ul><li>Employee described the Long Tail as follows: &quot; We sold more books today that didn't sell at all yesterday than we sold today of all the books that did sell yesterday.“ </li></ul></ul><ul><ul><li>Micro-Finance </li></ul></ul><ul><ul><li>Offers very small credits to lower-middle to lower class and poor people, that would otherwise be ignored by the traditional banking business. The banks that have followed this strategy of selling services to the low-frequency long tail of the sector have found out that it can be an important niche, long ignored by consumer banks </li></ul></ul><ul><ul><ul><li>Grameen Bank in Bangladesh and two banks in Mexico called Compartamos and Banco Azteca. </li></ul></ul></ul>
  9. 9. Who uses Long tail? Continued…. <ul><li>Marketing </li></ul><ul><ul><li>New Media Marketing: Building and managing of social networks , extend the reach of marketing to the low-frequency, low-intensity consumer in a cost effective way often through RSS feeds and blogs. </li></ul></ul><ul><ul><li>Viral Marketing: Spreading of marketing messages using pre-existing social networks, with an emphasis on the casual, non-intentional and low cost such as Youtube videos and viral emails. </li></ul></ul>
  10. 10. Benefits & Drawbacks <ul><li>Benefits: </li></ul><ul><li>Increases target Markets </li></ul><ul><li>More products on offer to consumers </li></ul><ul><li>Selling Less of more = increase on profitability </li></ul><ul><li>Reduces the cost of storage and distribution </li></ul><ul><li>Drawbacks: </li></ul><ul><li>Internet Access is required for both consumers and Businesses </li></ul><ul><li>Businesses need an e-commerce/website </li></ul><ul><li>Confusion of the distinction between the interpretations of where the &quot;head&quot; and &quot;tail&quot; begin. </li></ul>
  11. 11. The future of The Long Tail <ul><li>Things are going to be different in the future. It helps if you keep in mind a few basic ideas and concepts about the realities of the long tail economy: </li></ul><ul><li>Always think in terms of abundance, not scarcity. </li></ul><ul><li>Blockbusters will still come along, they are here to stay. </li></ul><ul><li>The niche revolution will reach every industry. </li></ul><ul><li>Successful long tail businesses will require both hits and niches to prosper well into the foreseeable future. </li></ul><ul><li>The question tomorrow will not be whether more choice is better, but what do we really want? </li></ul>
  12. 12. References <ul><li>http://ministrynetconference.com/wp-content/uploads/2009/10/The-Long-Tail.pdf </li></ul><ul><li>www.novelr.com/2008/02/08/the-long-tail-and-o... </li></ul>
  13. 13. ANY QUESTIONS

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