December 27, 2004

The "Long Tail" -- A Marketing Revolution

Wired's Chris Anderson publishes an important article on the changes in marketing brought about by the growth of the Internet, especially its reduction of transaction costs.

For example, a theatrical movie has to sell 1,500 tickets per week to pay the rent at a theater, and the customers will mostly have to come from nearby. Thus, there are theaters all around my county, but relatively little variety. Netflix, on the other hand, can carry tens of thousands of titles that could never pay for a theatrical release, and it rents them in large numbers. In fact, Amazon and Netflix, Rhapsody and iTunes sell more of the down-list items, in aggregate, than they do of the big hits. (The same is presumably true of blogs, though I haven't researched it -- little blogs like this one, taken together, get more hits when taken together than the Instapundits of the world.) The "long tail" is the line of little productions that can find a market for the first time in the Internet age, even if their individual audiences are relatively small.

There are several consequences of this phenomenon:

  • Certain productions are now potentially profitable that weren't in the age of theatres, book and record stores. Anderson uses the example of "Bollywood" films, that have almost no theatrical release in the U.S., because the audience, though large, is not concentrated enough to support such releases. On the other hand, Netflix has a large audience for these films. The same phenomenon creates new opportunities for obscure styles of music, documentary films, and back list books.

  • The common mass media culture is no more. When I was a kid, half of America, from 6 to 60, watched Ed Sullivan on Sunday nights. In my family now, it's an effort to find something that we all like to watch together (NBC's "Ed" was one program we found). As a result, we may have less unity in culture consumption, but a richer and more varied production. "Masscult" is being replaced by "multicult."

  • The authoritative position of mass media and its iconic figures, the Cronkites and Rathers, the Beatles and Oprahs of the world, is not what it once was. If Caeser had his Brutus, Rather had his Powerline.

  • As a result, there are new incentives for people like me to write. My mother half-jokingly aspired to have me become a junior Walter Lippman (a big-shot newpaper columnist of the era). I didn't go into journalism, and haven't had incentives to write more than an occasional letter to the editor or op-ed submission. In the era of the blog, I can find an audience, whether 20 hits a day, 100, and (I hope) more in the future. There's no money in it, at the moment, but there's an audience, and a discussion I am a part of. There's a creative explosion out there, a thousand flowers blooming.

It seems to Anderson, and to me, that the culture will have a richness and diversity unprecedented in history, as well as less uniformity, and perhaps, less unity. And we are only at the beginning.

HT: Instapundit.

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