Monday, December 3, 2007

Riding the Long Tail

According to Seth Godin in his week 9 Meatball Mondae on the Long Tail, "(Almost) everyone wants choice". He rightly says that "choice makes some people stressed and unhappy", which is something that Barry Schwartz would agree with. But in true marketing fashion he goes on to state that, "it also makes lots of people happy. And now people have the choice."

My interest is more from the economics concept of creative-destruction that I have been reviewing lately.

Competition and the Long Tail From Wikipedia

The Long Tail may threaten established businesses.[10]

Before a Long Tail works, only the most popular products are generally offered. When the cost of inventory storage and distribution fall, a wide range of products become available. This can, in turn, have the effect of reducing demand for the most popular products.

It is also of interest because it can be related to word frequency which relates to tagging and linguistic evolution which I have also been studying. According to the SEO-Blog,

"Word frequencies in natural languages such as English demonstrate the following property: In a given body of text there will be just a few words that are used very often and a large number of words that are used not so often. This property was noted by the Harvard linguistic professor George Zipf and the precise mathematical relationship is called Zipf’s Law." This is the basis for which this blog utilizes.

Seth then goes on to discuss the trends that are arising due to this change
  • a. Online shopping gives the retailer the ability to carry a hundred times the inventory of a typical retail store.
  • b. Google means that a user can find something if it's out there.
  • c. Permission marketing gives sellers the freedom to find products for their customers, instead of the other way around.
  • d. Digital products are easy to store and easy to customize.
  • e. Digital technology makes it easy to customize non-digital goods.

It was Seth that provided me the term change-agent. Even though its hairsplitting the term change-agent organization is far preferable to my thinking over non-governmental organization. The macro-economic class I am listening to informs me that only 30-35% of technological or productivity innovation comes from new machines or inventions, the bulk comes from new ideas from the suggestion box on how to use those new resources better. What I am now contemplating is how social change-agents can utilize this information. Items b through d seem fairly apparent to me. Items a and e are a bit more problematic.

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