The Long Tail Theory: Niche Audiences, Mass Marketing, and the Power of Choice

In Should You Invest in the Long Tail? Anita Elberse’s approach to The Long Tail Theory asserts that, though revenue-generating niche markets have grown, consumer purchase of niche entertainment products hasn’t replaced blockbusters or bestsellers. Elberse criticizes Anderson’s theory by offering information gleaned from extensive examination and analysis of U.S music and film sales data, which demonstrates that the theory may not be a fail proof strategy for marketing, branding, or distribution practices. Content abundance gives consumers more choices and, perhaps, inspires interest in non-mainstream products; this doesn’t necessarily lead to an increase in sales. At best, niche entertainment products can lead to additional sales when sold with blockbusters, but these sales shouldn’t be expected to replace blockbusters.

Elberse also states that, “from 2000 to 2005 the number of titles in the top 10% of weekly sales dropped by more than 50%—an increase in concentration that is common in winner-take-all markets. The importance of individual best sellers is not diminishing over time. It is growing.”

Anderson’s “Ben analogy,” where he emphasizes key differences between today’s generation and past ones, is also beneficial to any discussion about what competitive advantage might mean in the 21st century. To be competitive in the digital age is to build marketing, brand, and product delivery strategies that take into account the tremendous increase in autonomy that consumers have and value; particularly teens and millennials. Although Elberse’s article identifies logistical problems in Anderson’s concept and its application, the core idea of the theory is still valuable and relevant for adapting business strategies to changing markets and consumer needs.

Niche products may never replace blockbusters and big hits, but the Long Tail theory  still provides a useful framework for thinking about competitive advantage and the intersection between big hits and niche products. The central question for any organization that wants to remain competitive should be: How can niche products help generate additional sales for blockbusters? How can blockbusters generate more sales for niche products? The answer to maintaining competitive advantage is eclecticism, an understanding that no one strategy is sufficient for meeting the needs of a market that has become increasingly fragmented.

Niche audiences have, largely, been an invisible market for most businesses, including the publishing industry. If publishing companies implement business practices that increase the number of choices consumers have—eBooks, print products, and Internet content that includes bestsellers and niche products—they will thrive and remain competitive, even as the publishing industry changes. Competitive advantage will shape the publishing landscape of the future by demonstrating how necessary it is for publishing to adapt to consumer demand for choice, and the need to develop strategies that most effectively meet this need.

Moreover, staying competitive means that publishing companies should develop and implement multimedia objectives that are measurable or verifiable; achievable and feasible; flexible and adaptable; and congruent, as a means of evaluating the effectiveness of branding, marketing, and customer service quality. In adapting business practices to the principles of the digital age, these companies will need to create a substantial balance between operational and abstract thinking, as well as lofty and practical goals, while assessing strategy through evaluation of strengths, weaknesses, opportunities, and threats.



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