March 10th, 2007

misc - cupidsbow vidding

The Return of the Mid-List?

I've been reading this fascinating book on how internet-based businesses might change the current "hit-based" sales model, ushering in a new age of infinite consumer choice. It's called The Long Tail by Chris Anderson (link goes through to a short article published in Wired that was a precursor to the book).

To summarise the main argument: if you no longer have to worry about paying a lot of rent on display-shelf space in a shop, but instead you have cheap warehouse storage and your customer interface is a website (with virtually unlimited, cheap display space), you can make profits from things that don't sell very many units per month--from niche markets, in other words. In fact, you can make as much, or more, from selling lots of little niche items as you can from a handful of the old-style "Best Sellers." This interests me as a writer, because I find many "Best Selling" novels and films to be bland and generic (as you'd expect, given that they're designed to appeal to as many people as possible). In the book, Anderson gives examples of profit ratios for businesses like Netflix, Amazon and iTunes to illustrate his point, showing that they make a third or more of their income from the niche sales. It's very convincing.

I don't know enough about business to see the flaws/weaknesses in the argument (I'm sure there are at least a few problem areas), but I'm definitely liking some of the flow-on implications.

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