Wednesday, July 7, 2010

Marketing Japan: Is the Long Tail all Junk?

By Mike in Tokyo Rogers

After reading my "Primer on the Long Tail" where I explained what the Long Tail really is, one kind reader wrote to me claiming that most of the stuff (products, services and merchandise) on the Long Tail is "crap" and claimed that the proof in this lay in the fact that the average product in the Long Tail doesn't sell well. This, he claimed, is logical because he reasoned that it doesn't sell well because the average person doesn't want to buy it. So, in his reasoning, if the average person doesn't like it, then it hasn't mass appeal; If it hasn't mass appeal then it doesn't sell well so it must not be "good."

He claimed that sales are the ultimate determining factor in deciding whether or not something is "Good" or "Bad."


Is this pile of junk the Top 40 Charts or the Long Tail? You decide!

Well, I won't go into the subjectiveness of "Good" or "Bad" as what I think is good you might not like or vice-versa (or what is an "average person" - I like to think that I am not average and I hope most people realize that they are special too!) But the idea that one person's "Good" translates into "Everyone's Good" is, I believe, a little bit too simplistic so, I think you will have to find someone more intelligent than I to debate that point with you. But! I will show you how, without a doubt, for many smart companies who are doing intelligent business in Japan, the Long Tail provides them with better sales, profits and opportunities than the "hit" products. And I will prove to you, once again without a doubt that, when it comes to quality, what the the "average person" buys can often be a poor indicator of quality.

Popular and best selling? Yes. Quality? No comment (not from me at least).

The evidence of the booming business that the Long Tail offers on the Internet is all around, but even with that, some people refuse to see it, so I'll make some simple examples today.

Like I said, sure there is a lot of junk on the Long Tail, but there's a lot of junk at the top of the best seller list too. Would anyone argue that there's not a lot of crap on the, say, hit charts of popular music too?

Whether something sells well or not, is not completely a measure of it being "Good" or "Bad"; it is also a a factor in whether or not something was promoted or marketed well. It has to do with distribution problems and whether or not there was enough shelf space for it in a brick and mortar store.

I disagree that sales, in and of themselves, is a measure of "Good" or "Bad" and, once again, would like to point out what Chris Anderson wrote in The Long Tail to support my arguments. On page 118 it says,

"...for many people, the best stuff is in the Tail. If you're interested in Audiophile stereo equipment, the finest equipment is not going to be among the best sellers at Best Buy."

Think about that, that's exactly right. The best stereo equipment in the world would never be a top ten seller at a discount electronics shop or at K-Mart. Those places sell cheap boom-boxes imported from Asia. The best equipment would have to come from a specialist shop. I doubt that the average person is spending over ten or twenty thousand dollars for the world's best component stereo equipment. I won't argue that the average person is scooping up the compact, battery powered, CD, cassette, radio made in China that K-Mart has marked down to $8.99 for after Christmas clearance.

No arguments there. K-Mart also sells a guitar for $24.99 too... But I think you'd have a very hard time finding a professional quality Gibson or Fender for that low, low price - holiday clearance or not (OK, well, perhaps during the coming of the Four Horsemen of the Apocalyse!)

OK. I think anyone would agree with me on the examples above. Yes?


Now, I'd like to point out that, when done correctly, a company in the year 2010 and beyond can sell and profit more through exploitation of the Long Tail and products residing in the Long Tail market more than they can by just selling hit products.

Because the Long Tail offers a virtually unending source of goods, then niche marketing can find the perfect product to fit exactly what the customer wants... Not so with a brick and mortar store! Think about this: How many times have you gone to the store to buy something but couldn't find exactly what you wanted, so you settled on the next best thing? I know I have many times.

This should never happen with Long Tail retailers.... You search for what you want; find other customer reviews and recommendations, and order the best product to fit your needs. Not a product that is the least of two evils.


A good case in point how this niche marketing can be hugely profitable is Rhino Records. When I was a student in California in the late 1970's, I used to go to Rhino Records store in West Los Angeles. It seems to me that they had two shops at that time. I thought Rhino Records was dirty and dingy but I also thought it was cool as they sold 60's music as well as the local underground Punk bands too.

Rhino built a strong and loyal niche in that market for the Punk Music, underground, and 1960's psychedelia.... The story would have ended there, but they later made a deal with Capitol Records where they would remaster old Capitol back catalogue and re release it under the Rhino name. From that one deal, Rhino Records became a force to be reckoned with in the music industry.

Rhino Records didn't release big selling artists nor Top 40, yet they became one of the most respected and profitable record labels in the United States. They got that way by being cool and having street credibility. Credibility is hard to get, it is even harder to buy. Rhino got it by sticking to their guns and only marketing to a niche audience... A niche audience who, by the way, were sick of the big stars and the top sellers.

And all from releasing old material and back catalogue.

There is a huge opportunity for all of us in the Long Tail. The Long Tail, like Punk Rock in the 1970's, is taking the market out of the hands of the big corporations and bringing it back to the people.

And that is a key factor here: The Internet is bringing back business into the hands of the people; whether it be a small businessman promoting his company through blogs and blogging, video blogs (vlogs), Social Media and networking sites like Facebook, Linkedin or Mixi; to the housewife who has started a business out of her home utilizing Pick, Twitter, YouTube or U-Stream to freely promote herself and her business, the Internet has opened up an entirely new world to all of us.  

The Long Tail has lots of junk to be sure; but one man's trash is another man's treasure and, on top of that - say in the case of a record store  - the Long Tail has millions and millions of titles whereas the local record store has how many? A few thousand?

So, where do you want to shop? The Long Tail businesses that have these millions of items  - and the list keeps growing longer day by day - that are easy to find at the tips of your fingers from the comfort of your own home, or do you want to have to get up and travel to the brick and mortar shop that only sells a limited number of items in the hopes that they might have what is merely acceptable to you?

Your choice.

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