October 11, 2004

The Tail of Sellers

Francis Pisani made a really interesting observation yesterday, when we were talking about the Chris Anderson article, during a chat about how the blogosphere hadn't post much in the way of criticism or interesting observation about the premise of the article (it's mostly just quotes or pointers).

Francis noted that the examples used to illustrate the power of selling items that range down the power law tail are actually at the top of the power law curve themselves: EBay, Amazon, NetFlix, iTunes. And yet they are profiting from sales at the other end of the curve, where more obscure items can be found. This is because the transaction costs are so low, that they can offer things stores can't because the stores must sell a certain number per month to cover the rent. But this constraint does not exist when there is no store in the traditional sense.

This caused me to think about what kinds of sellers exist further down the curve, and are selling profitably items at the tail. Rhino Records? I couldn't think of too much off the top of my head, but I wondered if the required aggregation, and the trust customers have in eBay et. al. still means that the top sellers do best selling items that range from hits to obscure products or content, or if those sellers further down with only more obscure content, and with far fewer sales, are also benefiting from this economic shift. Is it possible that the diversity of media and products can come from a diversity of companies? I also would like to know where the buyers fit into this. Do the top purchasing customers purchase a range, or at the tail, or the top? Where do the people who just purchase now and then fit into this? I would love to have figures on this as well as the product hit sales analysis, though I would imagine that most online sellers wouldn't want to give even aggregated customer information about how much people purchase correlated to where their purchases fit on the hits scale of content. But it would be interesting.

Posted by Mary Hodder at October 11, 2004 08:39 AM | TrackBack

cd baby (http://www.cdbaby.com/) might be the sort of seller you mean.

and perhaps what seems to be a recent upswing in small t-shirt sellers.

Posted by: jim winstead at October 11, 2004 01:23 PM

Chelsea Green Publishing is a company that is selling extremely well on the long tail (as well as as at the head with our current bestseller Don't Think of an Elephant!). We are a niche publisher of books on sustainable living. Our key backlist how-to books on organic agriculture, green building, renewable energy, eco-cuisine, social entrenpreneurship, etc. are alive and growing on Amazon and other internet sites. We plan to offer more e-content and a subscription-based searchable database in the near future, along with e-books and other digital content. This is the future of book publishing -- meaningful content about authentic living -- as opposed to the mass market junk entertainment that is predominant in most mainstream bricks and morter retail outlets. So stay tuned.

Posted by: margo baldwin at December 21, 2004 06:03 PM