Recently, while doing some search, I read an interesting sentence, “In an era without the constraints of physical shelf space and other bottlenecks of distribution, narrowly-targeted goods and services can be as economically attractive as mainstream fare”. I read and re-read the statement that is the theory behind the book “The Long Tail”, by author, entrepreneur, economics genius, and CEO of 3D Robotics, Chris Anderson. Chris Anderson will be giving a keynote speech at http://www.tiecon.org 2013 annual conference.
Chris Anderson was with The Economist for seven years, prior to joining WIRED magazine in 2001, as editor-in-chief. In 2004, he wrote an article entitled “The Long Tail”, which he later expanded into the book, “The Long Tail: Why the Future of Business is Selling Less of More”. The book argues that products in low demand or that have a low sales volume can collectively build a better market share than its rivals, or exceed the relatively few current bestsellers and blockbusters, provided the store or distribution channel is large enough. As you think about it, it seems a no-brainer. But it took the genius of Anderson to make a clear and explicit case, and then prove it.
An example of this would be something that I have long thought about with regards to book stores. In the days of tablets and kindles, the brick and mortar book stores are increasingly a thing of the past. But if you ask people, they remember the book stores, with the fondest memories and often deeply mourn the shutting down of book stores. Why? It is because, people like the idea of picking up and reading a book, in a quiet setting, even for a few moments. But, they just don’t have the time to make a special trip to the bookstore. However, consider if the book stores divided up by genres. Then different businesses picked up a genre, and devoted a small sub-section for that genre, in their store. For instance, consider Toys R Us having a book store section with children’s books, with sofas and comfy chairs for book reading and Starbucks providing a small section for mystery and romance books, and Home Depot providing a comfy section to read “Do it yourself” type of books right in their stores. I would assume that people will likely go and pick up a book to read, while sipping coffee or to take a break in shopping, and then will buy it, before leaving the store.
Anyway, this is the thinking behind The Long Tail, that, in the era of constraints of physical space, narrowly targeted goods and services can generate a great deal of interest. Specifically, since online retailers can stock virtually everything, the sales generated by the number of niche products can easily outnumber the big hits. And given the current complexity in people’s tastes, preferences, and varying lifestyles, when consumers are offered infinite choices, the true shape of the demand curve is revealed and it happens to be less hit centric, than previously presumed.
Chris Anderson is currently the cofounder and CEO of 3DRobotics, a drone manufacturing company. We have heard about drones being used in warfare. These drones allow the military to put a camera in the sky anywhere, anytime, and are touted as the future of warfare. But only geeks are aware of and dabbling in civilian drones, right now. However, practical applications for personal drones are emerging, as they are becoming more reliable and sophisticated. They are gradually being used by farmers, scientists, those doing wildlife management, and those tracking endangered species.
Anderson has now become a champion of innovation in manufacturing and his vision might have potential to bring manufacturing industries back to our heartland. Hopefully, he will share his vision for the future of manufacturing with combination of cloud computing, open source and 3D printing.
Register for the conference at http://www.tiecon.org .