The long tail effect is a concept invented by Chris Anderson that examines the lingering tail that represents smaller market spaces (see graph above). Traditionally, popular products that guarantee sales have been prioritised for mass production. There is not enough space in the physical market to sell everything. And in a world of off the shelf, super market isle, pharmacy recommended products providing consumers with what is often a one size fits all product, more specific individual needs are ignored. The long tail effect examines how the internet is changing this market dynamic. The digital era means supply and demand are no longer limited to the physicality of a product and shopper. Limited and latent demands (existing demands that are yet to be realised) can now be met through small niche businesses in this long tail.
Within this long tails, lies many different worlds of niche demands, who also have long tails of their own. However, there are three key driving concepts that need to be understood by small businesses in order to be succeed in long tail environments. One, it is the tools of production that create this excitement of niche markets. As hardware and software become more accessible to the general public, it is easier to create and sell niche products. For example, webcam has allowed many individuals begin their youtube channel. Two, one must always think of internet aggregators. This is when products are pulled together and offered to a customer. For example, Amazon is able to sell rare books, new books and dated electronics to customers all over the world. And finally, that it is the filtering of software that connects supply and demand. High quality, aggregated niche products are found online, but only if it can be made accessible to its target audience. (Anderson, C. Evoy, K. 2006).
Indus Probha (IP) is my personal small business. It supplies niche skin care and make up products to specific clients, including cancer and eczema patients, people with skin irritations and allergies, vegetarians, vegans and clients who are concerned with the ethics how products are made. The foundation of IP is superior skin care and make up created through a wholesome business model. This process begins when sourcing ingredients and ends when the package sits in my clients hands. Every step of production is researched consciously to find the most sustainable and ethical practices, while creating healthy skin care and make up products. The brand was inspired while studying the Long Tail Effect and undertaking a project for DIGC202 and DIGC302. Here, the brand was developed, the paperwork begun and there was beginnings of a website. The aim for this semester is for all the paperwork to be finalised by mid 2017 and for the website to be live.
Beginning a small business is more work than it first appears. It will take one longer, much longer, than initially expected. It is for this reason that I have decided to begin a series of videos that will share what I have learned through this process, This includes videos focused on building a brand, sourcing products, obtaining a business license, how to accept payments, completing the correct forms and other social, legal and financial topics that arise when beginning a small business. The videos aim to communicate ways to address the unexpected obstacles that appear when building a small business and share the overall process in a clear and concise video platform.
Chris Anderson himself discussing the Long Tail Effect.
Anderson, C. Evoy, K. 2006. The Long Tail Effect, Why It Is Important For Small Businesses, Transcript of Interview, “Solo Build IT!”, SiteSell, retrieved 17th March 2017, from <http://longtail.sitesell.com/interview-transcript.html>
Elberse, A. 2008. Should You Invest IN The Long Tail?, “Harvard Business Review,”, retrieved 18th March 2017, from <https://hbr.org/2008/07/should-you-invest-in-the-long-tail>
Image for post found here http://www.technollama.co.uk/whatever-happened-to-the-long-tail