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long tail

Page history last edited by PBworks 11 years, 12 months ago

 

 

Truefans-1 

 

 

Blogosphere

 
 
 

The 80/20 Rule

 

There is a famous proverb: 80% of the wealth of the world is in the hands of 20% of people. While we know that the number of super wealthy is probably closer to 2% than 20%, the proverb turns a famouse rule of mathematics, known as power law, into common wisdom. If you look at the Wikipedia page linked above, you will be blasted with daunting math formulas. Yet, the concept and the explanation of the power law is remarkably simple - the rich get richer.

 

To understand this concept lets look at a familiar example - a popular news service called Digg. It is well known that there are power users on that site who are highly influential. How did that happen? Simply - they were among the first users of the service. As Digg grew and people joined, new relationships between users formed randomly. In any network, which has influx of new nodes and random formation of relationships, the nodes that were part of the beginning of the network become hubs.

 

So behind the seemingly complicated phenomenon, power law, one finds simple concepts of time and randomness. The reason that the long tail forms is exactly the same as why the hubs form - time. As the number of people in the network grows the chances that a new person befriends a specific member drops.

 

The Traffic Problem

 
Now imagine that the network is the blogosphere where new blogs spring into existence every day. And as they do, these newly minted bloggers are aspiring to make money. They set up their blog, pick a unique topic, research Google ads and affiliate programs, and they start writing content. But they are in for big disappointment, because in order to make money from blogging, they'll need more than good, original content - they need traffic.

Because of the power law, the long tail of the blogosphere is huge and so any individual blog is not easily discovered. That is, the chance that a random Internet surfer will find a blog that is part of the long tail is nearly zero.

 

Whatever monetization means the blogger in the long tail settled on, be it Google AdSense or Amazon affiliate codes, it can only work on large volumes of traffic. AdSense works for Google because the odds are in its favor - it is aggregating small amounts of traffic across the entire web. The math works for them because it is based on the massive scale of the web. It similarly works reasonably well for the sites with large amounts of traffic, but it fails for smaller publishers who have low visitor counts.

 

 

Making Money on the The Long Fail

You can make money on the long tail but not in the long tail. The precise point of Anderson's argument is that it is a collective of the long tail amounts to substantial dollars because the volume is there. The retail/advertising game is a game based on volume. You make money on a lot of traffic to a single popular site or the sum of smaller amounts of traffic to many less popular sites.

 

 

What about the companies that count on the long tail of the blogosphere? Since the incentives for individual bloggers are not many, betting the business on the long tail of the blogosphere is risky. This applies, for example, to widget companies that hope to gain massive adoption by enticing long tail bloggers. Perhaps it is possible, but the incentive can not be purely financial.

 

As long tail bloggers become disillusioned with their revenue potential, the businesses that bet on the long tail of the blogosphere are likely to pay the price. This price is very substantial, since, according to the whole scheme, there is a huge amount of money that is locked across the long tail. So if bits and pieces of the long tail begin to disintegrate and the whole thing collapses, the impact on the businesses built on it would be huge.

Conclusion

It is often forgotten that money is to be made by leveraging the collective long tail, however, making money while being part of the long tail is very difficult. Specifically, in the blogosphere, the vast majority of blogs have very few readers. It is not realistic to expect these blogs to make money. As the enthusiasm and the incentive in the long tail begin to wear off, what would be the impact on the businesses that depend on them? Likely, the impact is going to be large.

 

Now it's your turn. Please tell us what you think about the long tail of the blogosphere. Is it solid? Or is it in danger of falling apart?

 

 

 

 

A simple strategy for Musicians

 

1,000 True Fans

The long tail is famously good news for two classes of people; a few lucky aggregators, such as Amazon and Netflix, and 6 billion consumers. Of those two, I think consumers earn the greater reward from the wealth hidden in infinite niches.

 

But the long tail is a decidedly mixed blessing for creators. Individual artists, producers, inventors and makers are overlooked in the equation. The long tail does not raise the sales of creators much, but it does add massive competition and endless downward pressure on prices. Unless artists become a large aggregator of other artist's works, the long tail offers no path out of the quiet doldrums of minuscule sales.

 

Other than aim for a blockbuster hit, what can an artist do to escape the long tail?

 

One solution is to find 1,000 True Fans. While some artists have discovered this path without calling it that, I think it is worth trying to formalize. The gist of 1,000 True Fans can be stated simply:

A creator, such as an artist, musician, photographer, craftsperson, performer, animator, designer, videomaker, or author - in other words, anyone producing works of art - needs to acquire only 1,000 True Fans to make a living.

 

A True Fan is defined as someone who will purchase anything and everything you produce. They will drive 200 miles to see you sing. They will buy the super deluxe re-issued hi-res box set of your stuff even though they have the low-res version. They have a Google Alert set for your name. They bookmark the eBay page where your out-of-print editions show up. They come to your openings. They have you sign their copies. They buy the t-shirt, and the mug, and the hat. They can't wait till you issue your next work. They are true fans.

Truefans-1

To raise your sales out of the flatline of the long tail you need to connect with your True Fans directly.  Another way to state this is, you need to convert a thousand Lesser Fans into a thousand True Fans.

 

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