Hit parade vs the long tail

The traditional economy is a bit like the hit parade – no. 1 on the hit parade is has the biggest sales.

The result is that the most profitable products tend to appeal to the lowest common denominator.

The internet created a new business model termed the long tail . The key idea here is that because of the reach of the internet products which may have a low initial sales volume (“on the outside looking in”) may turn into long-term sellers and yield profits far in excess of the top record in the hit parade.

The long tail is the subject of a couple of books by Chris Anderson The Long Tail: Why the Future of Business Is Selling Less of More  & The Long Tail: Why the Future of Business Is Selling Less of More. His proposition is that the digital world has created products that cannot be sold in brick and mortar stores.

An oft quoted example is the book Touching the Void, which initially didn’t do well, but increased it sales after another book, Into Thin Air, was published. Amazon and other booksellers create links that list other books under the heading “customers who bought this boook, also bought:” This brought it back to the notice of readers.

Virtual bookshops can do this becasue they don’t have to carry stock.

But the real message seems to be that niche products can become very profitable – if one can find ways of bringing them to the notice of the likely market.