Part of heated discussions at The Directors' Centre have been around the relevance of Chris Anderson's book The Long Tail for our clients.
The theory of the Long Tail can be boiled down to: "Our culture and economy are increasingly shifting away from a focus on a relatively small number of hits (mainstream products and markets) at the head of the demand curve, and moving towards a huge number of niches in the tail.
In an era without the constraints of physical shelf space and other bottlenecks, narrowly targeted goods and services can be as economically attractive as mainstream fare."
The book challenges (and also supports!) our current thinking about the good old 80:20 Rule... There emerge six key themes as described in the book:
- In most markets there are more 'niche' products than 'hits'
- The cost of reaching those niches is falling dramatically - so you can now offer a massively expanded variety of products
- 'Filters' (recommendations or rankings, google etc) can drive demand towards the niches/the tail
- A consequence is that the 'hits' become less popular and the niches become more popular - the demand curve flattens
- There are so many niches that they can compete (collectively) and exist as a market rivalling the 'hits'
- The natural shape of the demand curve (without the physical constraints of shelf space) are less hit-driven than we believe.
The message is a straightforward one for smaller players. What you need to do is:
- Make it!
- Get it out there!
- Help people find it
And now it is cheaper and easier to do these things than ever before!
The Long Tail is a thought-provoking read - anyone growing a business should reflect on how they can scale up their existing offerings... In most markets the future does not lie in the 'hits' (the high-volume end of the traditional demand curve), but in what used to be regarded as the 'misses' (the curve's endlessly long tail)!
The Long Tail
What's The Problem? What's The Hurt? - a brief article
Even More Profit - free seminars with Paul Jobin (12 venues across the UK)
Let's Talk... More Profit - free seminars with Robert Craven (venues nationwide).