Myth of the Long Tail?
A study in the Harvard Business Review looked at some data in the light of Chris Anderson's "long tail" theory and concluded that while the tail is getting a bit thicker, the head - the "popular stuff" - is really what is growing. Or in the words of that great business philosopher, Ira Gershwin, "Them that's got shall get, them that's not shall lose. So the Bible says, and it still is news." I've written about this on BNET (the new business arm of CNET), and that has links to the study as well as to Anderson's reply (which I found essentially unsatisfactory).
But enough of them; let's talk about us. Does the long tail hold any hope for individual writers? Yes and no. The upside is that if you have some writing that will interest a large enough community, and you market hard, then you can make money. You can, that is, if you put in the work and don't sit passively, assuming that the long tail is going to bring your income to you.
I get the sense that many writers look to the long tail concept as a silver bullet that will bring money in without them having to do anything else. Nothing could be farther from the truth. Say that an Amazon sees 20 percent of its 2007 sales of about $14.8 billion in the long tail (though the study would suggest more like 10 percent). According to Anderson, the tail should be everything that you wouldn't find in a Borders or Barnes & Nobel physical location. That means every one of the estimate million book SKUs the 10 or 20 thousand you might find in a store. So be generous and call the remainder 9.8 million. Divide and you get ... $285 per year per SKU.
Even if there is an average of 2 SKUs per book (each SKU representing a specific version of the book you could buy), that's annual revenue of $570 from Amazon. Even if that is only part of what you get (and remember, physical book outlets won't even have your title, by definition of tail), what are you going to make total? Maybe $1100, and that's in total sales. The cut going back to the publisher is half, so you're back to your royalties on $570 a year, or maybe $60. Self-publish and you could get the number higher, but that's hardly the passive approach to the long tail.
The only hope the "long tail" offers the individual author is the old concept of niche audiences, marketing to them, and making money. Nothing new there, and nothing easy. In fact, I'd argue that the only writer who is really making money off the long tail is Anderson himself.
But enough of them; let's talk about us. Does the long tail hold any hope for individual writers? Yes and no. The upside is that if you have some writing that will interest a large enough community, and you market hard, then you can make money. You can, that is, if you put in the work and don't sit passively, assuming that the long tail is going to bring your income to you.
I get the sense that many writers look to the long tail concept as a silver bullet that will bring money in without them having to do anything else. Nothing could be farther from the truth. Say that an Amazon sees 20 percent of its 2007 sales of about $14.8 billion in the long tail (though the study would suggest more like 10 percent). According to Anderson, the tail should be everything that you wouldn't find in a Borders or Barnes & Nobel physical location. That means every one of the estimate million book SKUs the 10 or 20 thousand you might find in a store. So be generous and call the remainder 9.8 million. Divide and you get ... $285 per year per SKU.
Even if there is an average of 2 SKUs per book (each SKU representing a specific version of the book you could buy), that's annual revenue of $570 from Amazon. Even if that is only part of what you get (and remember, physical book outlets won't even have your title, by definition of tail), what are you going to make total? Maybe $1100, and that's in total sales. The cut going back to the publisher is half, so you're back to your royalties on $570 a year, or maybe $60. Self-publish and you could get the number higher, but that's hardly the passive approach to the long tail.
The only hope the "long tail" offers the individual author is the old concept of niche audiences, marketing to them, and making money. Nothing new there, and nothing easy. In fact, I'd argue that the only writer who is really making money off the long tail is Anderson himself.
Labels: distribution, long tail, marketing, sales, strategy
posted by Erik Sherman | 10:12 AM
2 Comments:
Erik:
How timely. I've just been listening to the audiobook version of "The Long Tail" so this has been on my mind. One comment: I've noticed the 'long tail' effect on my blog posts. Although more people who visit read the new stuff, I have a small but steady stream of readers who dip back into the old stuff - old being a relative term since I started the blog only six months ago. However, every day I get hits on blog posts I wrote 4, 5 or even 6 months ago. The biggest question is if I was selling this instead of giving it away: would they still be interested? Or if I packaged back posts into some kind of newsletter or e-book, would there be a market for the content? Those are the long-tail related questions I'm contemplating.
Best,
Michelle Rafter
It's even possible to do some rough estimation here. Say you're getting 5 hits a day that would be willing to pay $1 for access to one article. Over 365 days, that would be an addition $1825. Nothing wrong with that, but it's not that much when you consider the rate on articles, and if you're charging people for access to the archive of material, you're putting off some, if not many. Then you have to ask whether what you bring in would be worth potentially cutting your ability to build audience and, therefore, platform.
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