Long Tail 28#
Instead of concentrating on blockbusters, the main bulk of revenues is generated through a 'long tail' of niche products. Individually, these neither demand high volumes, nor allow for a high margin. If a vast variety of these products are offered in sufficient amounts, the profits from resultant small sales can add up to a significant amount.
Examples: Iconic Cases
How they do it: Netflix offers a wide variety of content on its platform. This allows the company to target a broad audience as it is easy to make all the content available and let the user chose what to watch. This also includes niche content.
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How they do it: While a spectacular 10,113 YouTube videos generated over 1 billion views, among the platform’s over 5 billion individual uploads there are many that have only been watched a handful of times, consisting of a long tail of niche videos.
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How they do it: Nintendo offers a wide variety of games for its game consoles. The games are not necessarily developed from Nintendo itself but all need to be certified by Nintendo to run on the consoles. The large variety of games allow for targeting of different age groups and genres.
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How they do it: CDnow, Inc. operated an online shopping website that sold compact discs and music-related products. In 1995, it already provided listings for over 100,000 music CD and cassette titles via its website.
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How they do it: On Steam, Valve’s game publishing platform, users can download (for free) or purchase access to 781 million different games, as of 2018. This includes large blockbuster titles, as well as very obscure games published by hobbyists. Most distinctly, a large portion of all games published on the platform (or, as much as 450 million games) were never downloaded or played. In 2018, Steam introduced a $100 fee for publishing a game on its platform, to curb abuse of the system.
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Below, the top industries for the pattern "Long Tail" are displayed, in order to get insights into how this pattern is applied across different industries. We've collected data from 5 firms using this pattern.
Top Industries
50% of firms using pattern
17% of firms using pattern
12% of firms using pattern
All Industries
Below, the pattern "Long Tail" is analyzed based on co-occurrence, in order to get insights into how this business model pattern is applied in combination with other patterns within the firms we studied.
Top Co-Occurrences
7 pattern co-occurrences
7 pattern co-occurrences
7 pattern co-occurrences