Thursday, December 25, 2008

Cutting Off the Long Tail

A few years ago, I bought my entire staff copies of The Long Tail: Why the Future of Business is Selling Less of More (Hyperion), by Wired mag's star editor Chris Anderson. No doubt in my mind that it was the new, new gospel, at least according to the algorithmic tea leaves of the World Wide Web. Anderson's premise was pretty simple: The Web's limitless shelf space allowed even the most obscure product to be distributed to millions, so long as it could somehow be accessed online. The hard wired retail realities of brick and mortar (what happened to that term?) didn't apply to the virtual mile-long aisles of Amazon, iTunes and Netflix. The long tail meant you could finally find a vast audience for your 1978 Peter Frampton memorabilia tour poster archive or Icelandic dark metal releases.

It was one of those theories that clearly seemed to be playing out, with music and consumption seemingly powered more by the collective niche, rather than the lowest common denominator muck that filled the airwaves and stores. Clearly, our tastes—dramatically amplified by Google's ability to bring anything we imagined to our browser—had broadened to include everything under the sun. iTunes showed us our strange tastes and penchant for digging out '60s film scores wasn't a wasted effort. And Apple made a few cents off of a customer that would never have set foot in a Walmart looking for the same track.

But like any good best-seller declaration, somebody has to come along and shit on it (just ask The Tipping Point's Malcolm Gladwell who has to deal with pesky arguments like this). Anderson himself is seasoned enough to anticipate the critics. Fair enough, I guess, I suppose there is a long tail of opinions too, right? Anyway, I came across an article today that questions the real power and prominence of Anderson's theory and illustrates a vital piece of the whole equation that is usually missing: mass is still needed to drive niche markets. In other words, without the traffic and content harnessing power of drivers like Amazon and Google, there is no true strength in the niche, especially when it comes to moving product.

"What most people did not realize is that the value of the 'long tail' was only to those who aggregated it. Google lives off the long tail of web pages; by having more of the web than anyone else available for search meant that everyone went to them to search, which in turn meant big dollars for Google. Amazon took the same approach, expanding their catalog and enabling third-parties to sell to their audience, allowing them to benefit from the long tail of books and other media that were out there, even if only a few people were looking for them. But the owners of that website on rare South American sports paraphernalia, or the sellers of the cult classic novel? They are just a small piece of the aggregated pie."

This is good news for the major labels, who pump out massive hits that sit like royalty on top of the bell curve while boutique artists languish in the low end of the tail somewhere. This is how the old machinery is built—pump it out and they will come en mass. But those of us who believe that we have a stake in this economy, as purveyors of select (or just plain weird) content and commodities, want and need a long(er) tail. And there's nothing in this recent data that should deter you from opening your own digital storefront in the virtual sticks. But it does come down to the ability to corral enough attention by using big boy channels (the formerly mentioned Amazon, iTunes, et al) to funnel consumers your way. Just something to remember before you quit your job and pray your new online-only album sales are enough to pay down your student loans.


Jonathon Feit (Fellow Journo-Muckraker) said...

In a feat of eloquence, Raymond, you manage to bring evidence against Anderson's model while at the same time sounding disappointed to do so. That's interesting.

Unfortunately, the notion of supporting the "Long Tail" seems a tad outdated at this point, considering that the long tail is quickly wagging goodbye as every...single...consumer...confidence...indicator suggests that the taste of luxury is evaporating like so much air at a Beverly Hills oxygen bar.

Chris Anderson and I have had some differences in the past, to say the least (see the comments section:

However, he was onto something before the bubble(s) burst: in my understanding, the value of the "long tail" as a consumerist phenomenon was that it was powered by people SEEKING OUT upmarket versions of the crap they already had. (Among the most famous cases often cited is Crest WhiteStrips -- which basically do the exact same thing as whitening toothpaste, but for several dollars more.)

If you're looking for the high-end niche, you'll find it. Yes, Google and Co. can help spread the word, but ultimately you'll drive the niche with rareness and prestige, making up for value with cost.

Now, that's not happening, and Anderson seems SOOO last year.

People are scared (for valid reasons), and they're not buying. Which is interesting, too, because a buying demographic that disappears during downtimes isn't a "buying demographic" at all: it's a fad with a specific fan base. Nothing more, nothing less -- and unfortunately for the "Long Tail" theory -- nothing as consequential as it initially seemed destined to be.

M.W.M Graphics said...

Great blog Raymond.
On my RSS now!

Cheers to another great URB issue.

Happy Holidays.