The document summarizes Anita Elberse's investigation into Chris Anderson's long tail theory. Elberse reviewed sales data from online music and video retailers and found that while niche products made up the majority of titles available, they accounted for a small share of total sales. She also discussed William McPhee's theory of exposure and double jeopardy, which found that popular products tend to be consumed by more users. The document concludes by providing advice to producers and retailers on how to approach the long tail.

2. PRESENTATION
PRESENTED BY:
JASPINDER SINGH SIDHU

3. Should You Invest
in the Long Tail?
by Anita Elberse

4. CONTENTS
1. Should you invest in the long tail?
2. Theory of anderson
3. Investigation
4. Mcphee theory
5.Advice to producers
6.Advice to retailers
7.conclusion

5. THE LONG TAIL THEORY IN SHORT
 EDITOR OF WIRED MAGAZINE:
chris anderson
 Chris anderson puts 42 distinct but
 related ideas.
 1. The merchandise assortments are growing.
 2. Online channels actually change the shape of the
demand curve

6. INVESTIGATION
 Chris investigated sales patterns in the music and home-
video industries –two markets that anderson and others
frequently hod up as examples of the long tail theory in
action.
 He reviewed sales data obtained from nielsen videoscan
and nielsen soundscan,which monitor weekly purchases
of videos and music through online and offline retailers:
 Quickflix and from rhapsody ……

7. Results of investigation

8. McPhee’s theory of exposure
 Sociologist william mcphee –theory of exposure
 Mcphee describes two phenomenon of distribution ;
 1.natural monopoly 2. double jeopardy
 Natural monopoly: light users of a product category are a
relatively large proportion of those customers interested
in the popular products.
 Because it seems that hit products “monopolize” light
consumers ,he called the natural monopoly.

9. DOUBLE JEOPARDY
 Mcphee noted that “the larger the proportion of the
people with a given alternative …the less likely are those
who are familiar with it to like it especially”
 The people who choose obscure products tend to be
familiar with many alternatives and to stick with popular
products.
 Mcphee described this concept because niche products
have a double advantage :first they are not well known
 Secondly: when they become known it is by the people
who “know better”.

10. Quickflix data

11. ADVICE TO PRODUCERS
 Donot radically alter blockbuster resource-allocation or
product portfolio management strategies.
 When producing niche goods for the long tail end of the
distribution, keep cost as low as possible.
 When trying to strengthen your presence in digital
channels, focus on marketing.
 Leverage your scale to improve online exposure and
demand for products .

12. ADVICE TO RETAILERS
 If the goal is to cater to your heavy customers, broaden
your assortment with more niche products.
 Strictly manage the costs of offering products that will
rarely sell .if possible, use online networks to construct
creative models .
 Acquire and manage customers by using your most
popular products.
 Even though obscure products may have a higher profit
margin.