The Long Tail Phenomenon
These days the World is shifting from mass marketing to personal service, from focus on mainstream products to popularity of unique and personalized goods. This principle is reflected in the Long Tail theory, which explains phenomenon of why revenue from total quantity of items, which are out of top positions, outnumbers greatly the one brought by a relatively short list of “hits”.
Sellers of all kinds are no longer limited by physical space of stores when operating in a virtual environment. Neither do they depend on local customers or limited distribution channels. Thus, finally, businesses have possibility to forget about need “to lump products and consumers into one-size-fits-all containers” (Anderson, 2006). To be more profitable, E-commerce organization should endlessly increase lists of offers, because narrowly-targeted products these days bring the same money as mainstream fare. Of course, there is a couple of conditions – prices on less-popular goods and services should be thoughtfully set and, in addition, a well-developed recommendations mechanism should be put to work on the online store site.
It should be mentioned, that similarly to how a real life trends influence online sales, the last ones also have an effect on demand changes offline. For instance, if a person with lots of followers in the social networks “Likes” a song of an old band, most likely this song will be bought and downloaded more and more. This avalanche of popularity at the end of the day will impact real life music stores that will need to offer records to correspond the increasing demand.
No way should the Long Tail phenomena be ignored by online stores owners. Providing services to the untapped niche markets gives an opportunity to win customers saving time and money, as there is no need for hard competition, which usually presents on mainstream niches. So, businesses should be coupling Long Tail sales with the same quality of service as they do for the mass as this
Sellers of all kinds are no longer limited by physical space of stores when operating in a virtual environment. Neither do they depend on local customers or limited distribution channels. Thus, finally, businesses have possibility to forget about need “to lump products and consumers into one-size-fits-all containers” (Anderson, 2006). To be more profitable, E-commerce organization should endlessly increase lists of offers, because narrowly-targeted products these days bring the same money as mainstream fare. Of course, there is a couple of conditions – prices on less-popular goods and services should be thoughtfully set and, in addition, a well-developed recommendations mechanism should be put to work on the online store site.
It should be mentioned, that similarly to how a real life trends influence online sales, the last ones also have an effect on demand changes offline. For instance, if a person with lots of followers in the social networks “Likes” a song of an old band, most likely this song will be bought and downloaded more and more. This avalanche of popularity at the end of the day will impact real life music stores that will need to offer records to correspond the increasing demand.
No way should the Long Tail phenomena be ignored by online stores owners. Providing services to the untapped niche markets gives an opportunity to win customers saving time and money, as there is no need for hard competition, which usually presents on mainstream niches. So, businesses should be coupling Long Tail sales with the same quality of service as they do for the mass as this
References: Anderson, Cris (2006). The long tail in the nutshell. Retrieved on 5th of March, 2013 from http://www.thelongtail.com/about.html