Chris Anderson’s book ‘The Long Tail’ is a book that reshaped my thinking on how where the opportunities are online.

So, what is the long tail? Well, according to Anderson, “the long tail is nothing more than infinite choice. Abundant, cheap distribution means abundant, cheap, and unlimited variety – and that means the audience tends to distribute as widely as the choice.”

Traditional supermarket stores can only stock so many products. They’re limited to the physical space in store, to the way customer’s eyes traverse the shelves. In this and many other industries, based on physical presence, 20% of the products accounted for 80% of the revenue. The good ‘ol Pareto rule held true.

But in the online world, shelf-space isn’t an issue. Thousands of products can be adding to online stores, and those orders ‘drop-shipped’ when they’re paid for by customers. Customers are free to browse virtual aisles and find the products that best meet their needs and tastes. Sure, many mainstream products still account for a bulk of orders, but the Pareto rule doesn’t starts to get a bit wobbly. Mainstream products account for less of total revenue, and demand spreads to the lower volume, niche products, lengthening into ‘tail end’ products of the Long Tail.

According to Andersen, the Long Tail boils down to six themes (you’ll have to buy the book for the full description – see page 53)

1. More niche goods than hits
2. Costs of reaching niches falling dramatically
3. Filters drive demand down the long tail
4. As product variety increases, demand flattens
5. Selling many, small quantity niche products can create more value than selling high volume, blockbuster products
6. The natural shape of demand is revealed

Anderson applies these rules to show many thought provoking examples, like the ways: Google spins out Ad Word campaigns, Amazon engages third parties through software to reduce its inventory, Yahoo uses internet radio to deliver personalised radio to web listeners, Netflix provides access to hundreds of thousands of video rentals to stimulate demand in back-order catalogues.

In this sea of products, recommendations engines and peer reviews provide guiding lights for our product purchases. Quoting the trend watching agency, Frog Design, Chris raises to our attention this pearl:

“We’re leaving the Information Age and entering the Recommendation Age. Today information is ridiculously easy to get; you practically trip over it on the street. Information gathering is no longer the issue – making smart decisions base don the information is now the trick…..recommendations server as shortcuts through the thicket of information, just as my wine shop owner shortcuts me to the obscure French wines to enjoy with pasta”

The long tail highlights the current sweeping through the media at the moment, washing away our faith in advertising and leaving e in its wake a new faith in individuals. We’re moving away from the high volume blockbuster products, to targeted

Chris distills the secret to creating a thriving Long Tail business to two imperatives:

1. Make everything available
2. help me find it

My recommendation:
5/5

Why I loved it:
Aside from everything above, it opened my eyes to new things.
Simple anecdotes based on real companies.