The Increasing Importance of Small Sales
October 6, 2006
I started reading The Long Tail: Why the Future of Business Is Selling Less of More. It's a very good book based on one good idea - that the economy is being greatly changed by the Internet. Whereas in the last 100 years businesses have been looking for hits to provide profits, an increasingly large share of profits are coming from the "long tail" - small sales of niche products.
Author Chris Anderson theorizes that the "emerging digital ... economy is going to be radically different from today's mass market. If the twentieth-century ... was about hits, the twenty-first will be equally about niches."
In companies examined, long-tail revenues were currently bringing in 25 percent of sales and the trend was accelerating.
I happened to get a report from one of my clients on their e-book publishing activity. Sure enough, a few titles accounted for 75 percent of the sales. The rest were just twos and threes of many titles. The key for them is to automate the order process, because the storage and delivery of these lesser-selling titles is just about zero.
posted by M. Masterson @ 9:19 AM,