The Long Tail Business Model

Entrepreneurship Blog

The Long Tail Business Model emerged from economic triggers such as the increased availability of media production tools, distribution channels and powerful search engines connecting supply and demand through the internet (search engines, user ratings, online communities). Companies such as Netflix, eBay and YouTube and Lulu.com have used the Long Tail Business model to focus on offering a large variety of products sold in low volumes to niche markets.Image

The Long Tail Business models require strong, generally web-based platforms to make niche content readily available to customers. The majority of the sales are from selling a large variety of products in low volumes. These sales produce aggregate revenues which can exceed those achieved by offering a smaller number of `hit`items. This business model is mainly applied in the media industry, but can be successful for other industries such as publishing, toys, etc.

In contrast to traditional publishing companies that select…

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