The Long Tail
Important points thus far:
- Touching the Void/Into Thin Air – Amazon recommendations and the way they’ve revolutionised the e-retail industry using preferential algorithms
“For too long we’ve been suffering the tyranny of lowest-common denominator fare, subject to brain-dead summer blockbusters and manufactured pop. Why? Economics. Many of our assumptions about popular taste are actually artifacts of poor supply-and-demand matching – a market response to inefficient distribution”
The physical world puts two dramatic limitations on entertainment:
- Need to find local audiences
- In the tyranny of physical space, an audience too thinly spread is the same as no audience at all
- Physics itself
- Radio spectrum can only carry so many stations, and a coaxial cable so many TV channels.There’s only 24 hours in a day of available programming
- Broadcast technologies are profligate users of limited resources
But, most of us want more than just hits.
Pareto’s Principle: the 80-20 rule
We’re stuck in a hit-driven mindset – if something isn’t a hit, it won’t make money. We assume that only hits deserve to exist. This is not the case.
With no shelf space requires, and, for digital, no manufacturing costs and hardly any distribution fees – a ‘miss’ is just another sale, with the same margins as a hit.
The industry has a poor sense of what people want.
“Popularity no longer has a monopoly on profitability.”
More than half of Amazon’s book sales come from outside its top 130,000 titles. In other words, the potential book market may be twice as big as it appears to be, if we can overcome the economics of scarcity.
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