Amazon Riding the Long Tail Curve

The digitalisation of media content has transformed the way we consume and produce products. Now, thanks to the Internet and digital technologies, we are free of physical barriers of space and have an unlimited choice of content which is accessible at any time to anyone who is online. This has transformed the trend in consumer demand for products and has led to the growth of niche markets as it’s now a lot easier for consumers to find and buy niche products which satisfy their unique and narrow interests. Our economy and culture have essentially shifted shift from mass markets to millions of different niches (Anderson). Now, we have an infinite amount of products. So basically, no matter how weird, quirky, unique or simply mainstream your interests are, there is something out there for everyone, including you! This democratization of content creation and distribution in the digital world essentially sums up Chris Anderson’s Long Tail Theory.

What is the Long Tail Curve?

conceptual

The Long Tail Curve reveals the true shape of demand when consumers have an abundance of choice. The red vertical section of the curve represents the small number of mainstream popular products which generate the most amount of “hits” and have thus traditionally dominated the offline markets. The orange horizontal long tail represents the aggregation of the infinite number of small diverse niche products a.k.a the “non-hits” which -arguably- collectively generate more revenue than the small number of mainstream popular products.

If you want to learn more about the Long Tail Theory and how Amazon is profiting from this trend, then have a listen to the podcast below!

 

 

References:

Cummins, C 2016, “Amazon Australia Expansion Set to Shake up JB Hi-Fi and Harvey Norman”, Sydney Morning Herald, 26 September, viewed 26 September 2016, <http://www.smh.com.au/business/retail/disruptor-amazon-set-to-shake-up-jb-hifi-and-harvey-norman-20160926-groe32.html&gt;.

Sanburn, J 2011, “5 Reasons Borders Went Out of Business (and What Will Take Its Place)”, Time, 19 July, viewed 26 September 2016, <http://business.time.com/2011/07/19/5-reasons-borders-went-out-of-business-and-what-will-take-its-place/&gt;.

 

 

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One thought on “Amazon Riding the Long Tail Curve

  1. Great blog post, clear and concise. I 100% agree that no matter the ‘weirdness’ of your interests the internet will undoubtedly be able to satisfy those needs. Amazon is a prime example and definitely leading the way in terms of giving us an abundance of access especially with respect to niche content.

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