'Long Tail' May Not Wag the Web Just Yet 132
Carl Bialik from WSJ writes "Expanding on an article he wrote in 2004 (and discussed on Slashdot), Wired magazine editor Chris Anderson argues in his best-seller 'The Long Tail' that the web is changing commerce from a hit-driven business to one focused on niches. But Wall Street Journal columnist Lee Gomes questions Anderson's data, and adds, 'I don't think things are changing as much as he does.' Gomes writes, 'At Apple's iTunes, one person who has seen the data -- which Apple doesn't disclose -- said sales "closely track Billboard. It's a hits business. The data tend to refute 'The Long Tail.' " ' On his blog, Anderson responds that Gomes 'stumbles over statistics and more, and in the end simply makes a muddle of what might have been an interesting debate over the magnitude of the Long Tail effect.'"
Look at Amazon sales (Score:5, Informative)
Re:What a crock! (Score:5, Informative)
Gomes is refuting Andersons thesis by saying that 20% of the items still make up 80% of the sales (percentages of the old 80/20 rule used for illustration)
Anderson's response though is that with essentially *unlimited* inventory percentages aren't always the best or only way to measure the "tail". Anderson's definition has to do with the absolute numbers that used to get cut off. So Gomes is counting a bunch of sales as "head" which Anderson is counting as "Tail".
For example: Imagine a market in which the old brick and mortar stores could stock only the 100 most popular items and that only 20 of those items made up 80% of the sales. In the new world of unlimited inventory there is an ecommerce store has a 100,000 items in stock and the top 20,000 account for 90% of the sales. So before the web the top 20% of items accounted for 80% of the sales but afterwards the top 20% accounts for a full 90% of the sales. Gomes says this means that Anderson is wrong and that the web made things even *more* hit centric. Anderson's "tail" includes items 101 through 20,000 which Gomes is including in the "head". This overlap between Anderson's "Tail" and Gomes's "head" used to be unmarketable "misses" but are now able to find a market & have even increased sales individually and also now make up a significant percentage of total sales to the retailer. Sales that previously didn't exist because the old brick & mortar store didn't have space for the product
As Anderson said. If Gomes had been a little more intellectually honest about his argument there could have been an interesting debate over how long the long tail is & what the limits of the phenomena are etc. Gomes does have a good point which he simply overstated. 20% of the products *are* still accounting for 80% of the sales, which Anderson's thesis *seemed* to undermine. To be fair Anderson (at least in the original article, I haven't read the book) doesn't dispute that 80/20 rule. Instead I think he could be summed up as saying that with unlimited inventory the 20% of inventory is a much bigger absolute number and also that retailers can profitably capture the 20% of sales that come from the 80% of the inventory that they used to have to forego for reasons of limited physical space.