Publishers Weekly had an interesting article How fat is the Long Tail? referring to a presentation of Anita Elberse, associate professor at Harvard Business School, at the annual meeting of the Book Industry Study Group (BISG).
"Elberse said that while the growth of online retailing has resulted in the expansion of products that are available for sale in the long tail, there is little evidence to show that sales of niche products have significantly increased. “The tail is getting longer, but it isn’t getting fatter,” Elberse asserted, referring to Anderson’s contention that with more items in the tail, sales will increase."
Basing her presentation on the sales of video's and music, DVD rentals and music subscriptions Elberse disagrees with Anderson's argument that expects customers to move away from the
blockbusters—and appreciate obscure offerings more finding that:
- Light users of a product category are a relatively large proportion of the customers of the more popular products
- Niche products have a double disadvantage:
(1) They are not well known
(2) When they finally become known, their customers consist of people “who know better” ‒ they like the more popular products more
Her advice to publishers?
- Do not radically alter current resource allocation or product portfolio management strategies. One or more winners still go a long way, and probably even further than before.
- When producing niche goods intended for the tail end of the distribution, keep costs extremely low. The odds of success are not favorable here either,
and they will likely become less so.
Her advice to online retailers?
- Broaden your assortment with more niche products.
- Strictly manage the costs of offering products that will rarely sell.
- Resist the temptation to direct customers to the tail too often, or you’ll risk their dissatisfaction.
