The Longer Long Tail: How Endless Choice is Creating Unlimited Demand [Paperback]

Note: The review that follows is of the revised and updated edition of a book that was first published in 2006. It offers essentially the same information and insights except that Anderson has added a new chapter on marketing, one in which he explains "how to sell where `selling' doesn't work." More about this chapter later.

In the October 2004 issue of Wired magazine, Chris Anderson published an article in which he shared these observations: "(1) the tail of available variety is far longer than we realize; (2) it's now within reach economically; (3) all those niches, when aggregated, can make up a significant market - seemed indisputable, especially backed up with heretofore unseen data." That is even truer today than it was when The Long Tail was first published years ago. The era that Anderson characterizes as "a market of multitudes" continues to grow in terms of both its nature and extent. In this book, Anderson takes his reader on a guided tour of this market as he explains what the probable impact the new market will have and what will be required to prosper in it.

According to Anderson, those who read the article saw the Long Tail everywhere, from politics to public relations, and from sheet music to college sports. "What people intuitively grasped was that new efficiencies in distribution, manufacturing, and marketing were changing the definition of what was commercially viable across the board. The best way to describe these forces is that they are turning unprofitable customers, products, and markets into profitable ones." Therefore, the story of the Long Tail is really about the economics of abundance: "what happens when the bottlenecks that stand between supply and demand in our culture start to disappear and everything becomes available to everyone."

If I understand Anderson's most important points (and I may not), they include these:

1. Make as much as possible available to as many people as possible.
2. Help them to locate what they need, quickly and easily.
3. Offer maximum inventory only online.
4. Customize supply chain in terms of niche markets
5. Maximize its efficiencies and economies (especially inventory control, order processing, and distribution,)
5. Be customer-driven in terms of "crowdsourcing"
6. Have strategy that separates content into its component parts (i.e. "microchunking")
7. Have a pricing strategy that is "elastic" (i.e. based on the ROI of fulfillment per product per niche).
8. Have an open source business model for information sharing.
9. In markets where scarcity exists, "guesstimate" costs, margins, sales, profits, etc.
10.Where there is abundant competition, let those markets "sort it all out."

These and other points can guide and inform decision makers as they struggle to compete profitably during the era of "long-tailed distributions," when culture is unfiltered by economic scarcity and high technology is turning mass markets into millions of niches. Anderson provides invaluable advice with regard to how minimize the cost of reaching, penetrating, and then developing a multiple of niche markets. The paradigm has shifted from selling more in fewer markets to selling less in more markets but also, key point, selling as much as possible within as many segments as possible -- and prudent -- within those markets.

With regard to the new chapter, Anderson devotes much of his attention to online marketing and suggests that critical issues to address include these:

Who's influential "in our space (and how we know)"
Who/what influences them
How to get Digged
Effective blogging
Using beta-test invite lists
The art of begging for links
"Link bait" (e.g. stunts, contests, gimmicks, memes)

How to view the Web? "Forget it as a marketplace of products, and instead think of it as a marketplace of opinion. It's the great leveler of marketing. It allows for niche products to get global attention. Most products will be sold offline, as they always were. But in years to come, more and more products will be marketed online, taking advantage of Web methods to fine-slice consumer groups and influence word of mouth more effectively than ever before in history. Not all industries lend themselves to an infinite variety of products, but all industries have an infinite variety of customers. Finally we can treat them like the individuals they are. It's the sunset of the thirty-second spot."

There are several reasons why Anderson believed there is a need for a revised and updated edition. Here are two. Because the earlier version became a bestseller, it attracted lots of attention, generating an abundance of discussion of his core concepts. Also, the process of adopting his ideas (many of which at first seemed counterintuitive, if not precious and naive) was complicated by the globalization of culture. Focus shifted to distributed audiences around the world. Anderson was asked for additional examples of Long Tail effects outside the digital realms of media and entertainment. He certainly could not cover all of the extensions in fashion, travel, organic and "artisanal" food, and even alcohol as indicated by -- to cite one example -- Anheuser-Busch's embrace of niche beers, the establishment of Long Tail Libations, and the increased number of beers from 26 brands in 1997 to 80 in 2007. Given the fact that change continues to be the only constant in the global business world, think of this revised and updated edition as only the latest update on some Long Tail developments thus far.

Presumably the tail will continue to lengthen in months and years to come.

When you want to eat ice cream outside your home, do you go to a store that offers only chocolate and vanilla . . . or do you go where there are many more choices? Most people will do the latter. That's the basic point of this book. If you're satisfied with knowing that point, you don't need to read the book. Instead, you could settle for Mr. Anderson's article in the October 2004 issue of Wired.

But if you are like the growing legions of people who enjoy knowing more about the quirks of micro-economics (such as those who were intrigued by The Tipping Point, Freakonomics and Fooled by Randomness), The Long Tail will provide much entertainment.

Let me explain what a long tail is. If you plot the popularity of various products (say, books on Amazon) with the most popular products at the left, the left part of the curve will be very vertical (the head) and there will be a long list of items to the right that will have relatively few sales (the tail). Mr. Anderson's point is that as it becomes economically viable to produce and distribute more low-volume products (such as print-on-demand books and e-books), there will be more items available to purchase at any outlet . . . and the length the tail to the right will grow. As more outlets can afford to make these items available, the thickness of the tail will also grow.

A physical store will only distribute a small percentage of the items, stopping where the offering no longer adds to its targeted rate of profits. An on-line store will have far more items (such as Amazon), appeal to more customers and sell lots of its volume in relatively unpopular items. The author estimates that 25% of Amazon's book sales volume, for instance, comes from outside the 100,000 top selling books.

Here's where Mr. Anderson begins to lose his way: He tries to describe the sociological implications. He sees, for example, a loss of common cultural items of the sort that talking about the Beatles appearing on Ed Sullivan once provided. He imagines a world in which everyone drifts off into various different niches and the size of the head becomes less vertical. While that may be true, it doesn't correctly forecast the amount of commonality in the culture. The sales of any given item over time may well be in both the head and the tail. Or an item could be a sleeper and always be in the tail, but if enough people buy it, the item will become part of the common culture. In addition, some elements of common culture don't appear in sales curves. I'm sure that yesterday's arrests in the alleged plot to bomb a number of airplanes have already become part of the common culture.

I won't go on to point out his other errors. I'm sure you'll notice them for yourself.

The other disappointment was that he doesn't do a very good job of describing strategy choices for product producers. It seems to me that the long tail is simply another argument in favor of intense individual product and service customization of the sort that Dell has been giving us for years in computers and related equipment.

My grade of 3 stars for the book is 5 stars for long-tail trivia and 1 star for sociological and producer analysis.

If you haven't read any of the following books, The Tipping Point, Freakonomics and Fooled by Randomness, I recommend that you read those long before you get around this one. They are much better books about micro-economic implications.

I started reading The Long Tail straight after reading "Why The World Is Full of Useless Things" by Steve McKevitt which was published last year. These are two great books to read together offering a much broader analysis than they do on their own.

I think we've got it in ourselves to move into a more ethical way of being - and the potentially limitless choice of the internet might paradoxically bring that about, as per Long Tail, we stop being passive consumers of mass produced crap, we develop ever more niched niches for our little individual selves to consume and create from, power really does pass back to consumers (sort of) etc. I urge you to read both.