Valleywag
You know Chris Anderson's thesis, that the internet brings attention or money to all kinds of previously marginal endeavors; in other words, that we live in the age of long tail distributions. Hence the title of his best-selling book, Long Tail, which has inspired more hopeful business plans than Net Gain did during the last cycle. Unfortunately, the tail's not as long as one thought. One of Anderson's most impressive statistics in his original article, that 57% of Amazon sales are in the long tail, was out by a factor of two. Oops.
That part of the analysis in the 2004 article, which was based on some MIT work, appears to have undercounted the top-sellers. Forensic economics isn't perfect. We've subsequently done a lot more work and revised that to 25%, which is the figure used in the book and all other writings for the past two-plus years. Please use the more recent figures. [Chris Anderson]
Comments
Wow.
There goes the last two years of hype about niche products. Of course, 25% is still a great amount, but.... y'know, not more than half of Amazon's house.
25%?!?! Ooops?!?! So instead of over half in the tail it is now only 25%? That means that 75% is NOT in the long tail. not very impressive to me - in fact, though substantial, not worthy of a "movement". I would question if the concept is worthy of a business plan, which I wondered about all along.
The key is not how much volume you're doing on the tails, but how much profits. In addition, how the availability of long-tail items effects how often consumers come to look for center-distribution items is really important.
Dalew, good points, however, I wonder if it is enough to make a profitable business from it.
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