What is the Long Tail in eCommerce?
Introduced by Chris Anderson in Wired magazine 2004, the “long tail” refers to the vast array of niche products with relatively low individual sales volume but collectively contribute significantly to overall revenue when aggregated.
Imagine a bell curve representing product popularity; the head, encompassing a few widely sought-after items, generates substantial sales. The long tail stretches out, containing numerous individual products with lower individual demand but collectively representing a sizeable market segment.
Long Tail Business Model
The long tail presents a distinct business model, challenging traditional notions of success predicated on high-volume, low-margin sales. It thrives on:
- Niche specialisation. Identifying and catering to the needs of specific customer segments with unique preferences.
- Product diversity. Offering a wide variety of products, even if individual sales are minimal.
- Long-term customer relationships. Building loyalty and repeat purchases from within specialised customer segments.
- Operational efficiency. Streamlining processes to manage a large inventory with lower individual demand.
This model allows businesses to build sustainable revenue streams from seemingly insignificant individual sales, leveraging the collective power of the long tail.
How Taggstar Can Highlight Long Tail Stock
Excess inventory is a very real challenge for retailers, ensuring long-tail stock is easy-to-find and stands out is vital.
Although social proof messaging works well for surfacing bestselling items, helping customers discover the top 20% of stock that sells best, it can also highlight other items within the same category – such as one of the top 10 or 20 bestsellers that day, for example. This can encourage sell-through of similar items in the range rather than just the favourite. Read more on our blog “How social proof messaging can highlight long tail stock”.
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