The “Break it Down” Blog

For the business folks in the ground, a recent Harvard study has come out that is declaring the much-referenced Long Tail Theory is infact false, and in most markets the “long tail” is not profitable after all or has very little room to profit from, where as attacking the “big hits” are much more profitable and, interestingly enough, seem to provide more satisfaction to consumers.

For the folks that aren’t familiar with the Long Tail Theory and want it explained to them by someone who can barely read his own name, I believe the gist is something like this:

Considering the graph above, and using some category of product like music, we could say that big hits are hugely popular and make record companies a lot of money. The Long Tail Theory argues that there is so much volume still available in the tail (off to the right) that money can be made if you can cover the breadth of it… so instead of worrying about producing/selling hits, maybe you could just produce and/or sell all the more obscure music that people will want, and have a really thorough collection of it.

And what this Harvard study is saying is “no-way-jose”, there is little to no money to be had in the tail portion of an industry and that if you aren’t producing/selling hits, you need to move on.

Thoughts?

Thanks Slashdot!