The Long Tail

The long tail, in business, is a phrase coined by Chris Anderson, in 2004.

Anderson argued that products that are in low demand or have low sales volume can collectively make up a market share that rivals or exceeds the relatively few current bestsellers & blockbusters, but only if the store or distribution channel is large enough.

The tail of a distribution represents a period in time when sales for less common products return a profit due to reduced marketing & distribution costs. Long tail is when sales are made for goods not commonly sold.

“The biggest money is in the smallest sales.”

The internet is shifting the focus of the economy from producing a small number of big hits to satisfying a legion of niche markets. Amazon & iTunes can stock virtually everything. And the falling costs of distribution means that every niche consumer can get their hands on what they want. The demand for products not available in bricks-and-mortar stores is potentially as big as for those that are, and that a relatively homogeneous culture is giving way to a fragmented world in which a thousand flowers bloom.