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July 5, 2006

Jack Covert Selects: Jack Covert Selects: The Long Tail

By: Jack @ 3:32 PM – Filed under: Management & Workplace Culture

The Long Tail: Why the Future of Business Is Selling Less of More By Chris Anderson, Hyperion, 256 pages, $24.95 hardcover, July 2006, ISBN 1401302378. Back in 2004, my partner in crime Todd ran into my office holding a "Wired" magazine article that I absolutely had to read. That article introduced the term "The Long Tail." Shortly there after, Chris Anderson created a blog to continue the discussion around his ideas; the buzz continues to grow. This month Anderson's book on the same subject lands on store shelves. For those unfamiliar with the idea, let me explain. The economy is changing. In the past, there weren't a lot of choices. For entertainment you chose between one of your three television channels or your local movie theater with a similarly limited selection. This created a blockbuster-driven culture. Everyone watched the MASH finale and saw Star Wars in the theater. Everyone accepted what was offered. The variety of choices has since started to multiply. Why? The Internet. It has created a whole new way to distribute content. No longer are we limited to products carried in our local stores. Now we can find something to fulfill even the smallest niche desires. Before, we went to Blockbuster to rent movies. Their shelf space limits them to carrying 3000 titles. Now we have 15 times that choice through Netflix which aggregates the demand for niche titles across the country. 21% of the movies rented through Netflix would never be found in a physical store. Yet, Netflix is competing with more than Blockbuster; it's competing with and contributing to the growing market for film. On another end of the spectrum, there's YouTube, the exploding website of amateur videos. With professional production tools available to the masses, all you need to create a video is a webcam and iMovie. The content found on YouTube is what the Long Tail is all about. People can now find and "consume" content that matches their niche interests. This concept is not limited to videos. Consider the king of the colored toy block--LEGO. 90% of their products are not available in retail and that represents 10-15% of their annual revenues. In the spirit of consumer production, LEGO has created a factory program. With simple software, customers can create their own kits and upload them back to the website for others to order. Ultimately this means that there is a market for nearly everything out there. Someone somewhere will be interested in it. Where is your long tail? ------- If you would like to receive the monthly Jack Covert Selects Newsletter, please visit the Newsletters area of our website. Then, sign in and check the boxes of the newsletters that interest you.