In The Long Tail, author Chris Anderson describes the move from a few giants dominating a market to a longer tail of niche customers and providers. This trend is true across books, music, fashion, home appliances, and much much more. In fact, if you want a primer on The Long Tail, you can read his blog, which provides some examples of how this concept applies. A long tail market has these six characteristics:
- “There are far more niche goods than hits.”
- “The cost of reaching those niches is…falling dramatically.”
- A range of new tools and filters exist that allow customers to find exactly what they’re looking for.
- “…the demand curve flattens. There are still hits and niches, but the hits are relatively less popular and the niches relatively more so.”
- “…there are so many niche products that collectively they can comprise a market rivaling the hits.”
- “…the natural shape of the demand is revealed, undistorted by distribution bottlenecks, scarcity of information, and limited choice of shelf space.”
In short, the effort/cost required to produce and deliver a good is falling. At the same time, consumers now have endless tools at their disposal for finding niche products that satisfy their exact need. Together these two forces create “the long tail.”
For more, you can read this blog post that was inspired by The Long Tail.