Long Tail theory Reading Notes: Chapter 1 long tail market

The online world has the power of word of mouth and combines two things: unlimited shelf space, and real-time information about purchase trends and public concepts.

The more consumers can find, the more they like. When they break through the old road and enter the vast network, they find that their taste is not as mainstream as they think, it is a powerful marketing method, and the popular culture and narrow choice space make them mislead themselves.

The popular taste we identify is actually only the product of the imbalance between supply and demand, and the imbalance between supply and demand is a reaction of the market to the ineffective distribution.

Local customers must be found to be a weakness in the traditional retail industry. Retailers must ensure that their products can bring enough demand; otherwise, they cannot survive, they can only win customers from a limited number of local residents. An outstanding documentary may have 500 thousands or 600 thousands potential users nationwide, but it is useless. What matters is His attractiveness in a specific region.

Given the geographical location constraints, the audience is too scattered, and it means there is no audience at all. Similarly, the limitations of broadcast technology have to attract enough audience in limited channels.

In the past century, the entertainment industry has resolved these restrictions in a simple way: focusing on the hot spot.

Hot economics was born in an era of insufficient supply. In this era, we do not have enough space to provide everyone with everything: We don't have enough shelves to put all the CD, there are not enough screens to play all movies, and there are not enough channels to play all programs.

Map the monthly statistical data of Rhapsody into a graph:

• It seems that all downloads are concentrated on the first few of the most popular tracks. There are 4500 types of CD for Walmart operators and 25000 first tracks.
• On the right side, the curve does not fall to zero. In the top 25,000th to 100000 tracks, the average monthly downloads continue to reach 250.
• Since there are too many non-popular tracks, their small demands quickly converge into large demands, accounting for almost 25% of the total downloads of Rhapsody.
• The number of tracks ranked between 100000 and 800000 is not found in the most professional recording store, but the demand is still not zero. Of the countless tracks, almost everyone in the capital has bought them.

What's surprising about this long tail is its scale. If we combine enough non-popular products, we can actually form a big market that matches the hot market.

These countless sporadic sales are an efficient and low-cost business. Because there is no rental space on shelves, the sales of niche products are more and more favorable, and the profit is not lower than that of popular products.

If you can greatly reduce the cost of linking supply and demand, and include niche products within our capabilities, the market demand for non-commercial content will be exposed. This is not only a quantitative change, but also a qualitative change.