The long tail is a retailing strategy in which a business profits from selling a very large number of different items in small individual quantities, alongside a much smaller number of bestsellers sold in bulk, rather than focusing only on high-volume hits. The business application of the idea was popularized by Chris Anderson in an October 2004 Wired magazine article and his 2006 book The Long Tail: Why the Future of Business Is Selling Less of More, building on 2003 research by Erik Brynjolfsson, Yu Hu and Michael Smith showing how much of Amazon's book revenue came from obscure titles unavailable in physical stores. The model works when distribution and inventory costs are low enough that carrying many low-demand items remains profitable, and it underlies the economics of retailers such as Amazon, Netflix and iTunes.
Facts
Core MechanismThe long tail strategy profits from selling a very large number of different items in small individual quantities, alongside a smaller number of bestsellers sold in bulk, so that aggregate demand for niche items can rival demand for current hits. It depends on distribution and inventory costs being low enough that carrying many low-demand items stays profitable, which is why the strategy is strongly associated with online catalogs that face no physical shelf-space limit. 1 Origin YearThe business application of the term was popularized in an October 2004 Wired magazine article by Chris Anderson, later expanded into his book The Long Tail. Cross-Tradition Connections
Associated With
The long tail's business application was built on 2003 research showing how much of Amazon's book revenue came from obscure titles unavailable in physical stores, the founding empirical case for the strategy.
Netflix's catalog strategy is a frequently cited example of the long tail, profiting from a large volume of niche titles rather than a small number of blockbusters.
The long tail business model describes how publishers profit from a large catalog of backlist and niche titles rather than relying only on bestsellers.
Sources
1. Wikipedia, Long Tail
WikipediaWikipedia: Long tail, business-application paragraphQuote, Wikipedia: Long tail, business-application paragraph
the term long tail is applied to rank-size distributions or rank-frequency distributions (primarily of popularity), which often form power laws and are thus long-tailed distributions in the statistical sense.
1. Wikipedia, Long Tail
WikipediaWikipedia: Long tail, popularization sentenceQuote, Wikipedia: Long tail, popularization sentence
The long tail was popularized by Chris Anderson in an October 2004 Wired magazine article, in which he mentioned Amazon.com, Apple and Yahoo! as examples of businesses applying this strategy.
Wikipedia, Publishing
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