The Long Tail

The Long Tail is a term used in a statistical sense to explain the distribution of a companies profit income. The long tail can be described in a graph (here is some information in better detail on Long Tail on Wikipedia.org), however, I will try to my best to explain. In a graph the long tail starts as a great peak and then dramatically slopes down into a constant tail. This tail if taken piece by piece is only worth little in value, however, if added up as one whole the tail end can have a greater value than the peak end of the graph.

There are large businesses who profit only from the peak profits, thus they must be careful to only produce the highest selling products. On the other hand there are some companies such as Amazon.com who make the bulk of their profits from the tail end of the graph, though they do gain substantial profit from high selling items as well. It is obvious that a company that can make profit off of both the high selling products and tail end products will be very successful. The problem is it takes money to produce and stock any product and it is hard to know at what time a certain low selling product will be in demand. This is why most companies only produce items that are in high demand.

Everyone in the class had very good insights on this subject. Some blogs that I thought were good were Joy's page and Danielle's blogs both offer great ideas on the subject of the long tail.