I’m thinking of a buzzword (well actually a phrase). Its mention may inspire some of your peers and strike fear in the hearts of others. This phrase could be used to bring the excitement of Conker to a larger audience or profitably shine a spotlight on the thrill of Chess boxing. It’s a word that could be used to vilify the backward ways of luddite media elitists, bent on aggregating mass audiences with homogenized content or laud the visionary action of online retailers willing to sell anything in a desperate (but valiant) effort to stay in business.The phrase I’m thinking of is the Long Tail. That’s right, it has gone from being a mere buzzword used to spice up executive presentations, to a fully capitalized noun (big L, big T). Yet it remains a poorly understood concept by either its many excited fans or its few detractors.
In 2004 Cris Anderson, editor of Wired Magazine, started talking about something he dubbed the “Long Tail”, based largely on ideas put forth by Clay Shirky (of UrbanDesires.com fame) and the observations of an Italian academic on the distribution of wealth. The basic idea was that internet based businesses, without inventory listing constraints, could sell products that have low demand and/or low sales volume. In the aggregate these products can make a market that is equal to or larger than the “hit” driven model that fuels traditional media businesses.
According to Mr. Anderson, “The average Barnes & Noble carries 130,000 titles. Yet more than half of Amazon’s book sales come from outside its top 130,000 titles. Consider the implication: If the Amazon statistics are any guide, the market for books that are not even sold in the average bookstore is larger than the market for those that are.” This is essence of the Long Tail argument.
The Long Tail builds an interesting analogy for thinking through ideas about a digital marketplace. A marketplace where the constraints of “shelf space”, platform, technology spectrum, consumer timing and market size are either greatly reduced or removed entirely. A digital marketplace where value is created by connecting users with media when, where and how they want it (at the price they are willing to pay). There are a number of challenges that media companies face when attempting to adapt to a Long Tail market, chief among these is the challenge of transitioning from aggregating content for media consumption to providing services or tools for media use.
The transition from foisting media onto a fictional “average consumer” to providing media to unique users is going to be both messy and challenging. As media companies look at long tail markets they seem to see really small and slightly distasteful groups of non-conformist sub-cultures. The tendency among these companies is to treat these groups as really small and kinda dumb sets of “average consumers” upon whom they can fob off iterations of the same old “we make, you eat” content models that reigned for so long. Meanwhile, companies like Apple, Netflix, Tivo, BitTorrent, and others have built tools and services around content that unleashes (unbundles) options for users to connect with the media they desired.
Another looming issue for media companies devising long-tail strategies is the obsession with the “head” of the curve. There seems to be a sense within media companies (initially supported by Mr. Anderson himself) that in order to have a successful Long Tail business it requires both the head and tail (mass market and niches). Sites like Flickr and Myspace, which have built significant audiences using only the tail, highlight the error in this kind of thinking. Belief in the intelligence and varied tastes of “consumers” is not native to media companies, nor is ceding control. For media companies with a “hit” driven mentality burned into their DNA, looking at the tail as an addressable market is both difficult and counter-intuitive.
This difficulty is compounded by the tendency of media companies to be fooled by the randomness of their wins and incorrectly attribute knowledge, competency or foresight to them. There is a tendency within these companies to believe that behavior at the head of the curve can be predicted, controlled and replicated while behavior at the tail (which is far lass familiar) is prone to more uncertainty and risk. A look at the full portfolio of any media company (where 1 hit finances 10-20 “flops”) highlights the fallacy of the first belief and the basic tenets of the risk perception suggest that the second is also wrong. The implication for a Long Tail strategy based on these beliefs is the over-emphasis of risk and the devaluing of variance both of which foster environments rich in analysis but light on involvement and action
Developing a Long Tail strategy requires more then just providing content to smaller groupings of “average consumers”. It requires thinking about how one adds value to a media experience or enables models that can incorporate markets as small as one. It also requires going native in the environments and cultures in which you wish to play.