Author Chris Anderson is building an empire from one clever catchphrase, The Long Tail. According to Anderson, the unlimited shelf space of Internet merchants like Amazon and iTunes allows a broad product offering that generates lots of revenue from “non-hit” titles. In two recent columns, The Wall Street Journal’s Lee Gomes says it’s wishful thinking. He’s been talking to execs at the major e-commerce portals, who report that the bulk of their revenue comes from the hits, just like the old brick and mortar days.
The stakes in the Long Tail debate are high, as the discussion resonates in the halls of film studios, record companies and publishing houses. Should they spend big bucks on chasing hits, or put out lots of niche titles? The answer to these questions determines what kind of content will be available to consumers in the future.
Listening to Anderson on KCRW recently, I wondered if his focus on Amazon, iTunes and Netflix is too narrow. Anderson speaks of these “aggregators” as offering “convenience” to the customer, compiling everything together in one easy place so that the customer can buy hits and niche titles at the same time.
But what if the consumer of left-of-center media doesn’t want to browse it within a mega-space? I posed this question to Louis Posen, President of punk/hardcore label Hopeless Records.
“When you buy toilet paper on the Internet, all you are looking for is convenience and price. Not so when you are consuming punk rock,” he explained. “Kids will drive an hour or two to attend a concert, and get there early to stand in line just so they can hang out with other fans. When it’s part of your identity or lifestyle, expressing yourself and being part of a community is more important than convenience.”
Posen told me that his target audience likes to shop at online merchant interpunk.com, rather than at Amazon. “Amazon carries every one of our releases, but their sales are modest at best, maybe 3-5 units per week of each title. Go over to interpunk.com, and each title sells 20 units per week, sometimes more. We do presales at interpunk that can reach 600 copies before street date, something we could never achieve on Amazon.”
I then reached out to Todd Young, who runs an e-commerce fulfillment house called “the conneXtion.” Young’s company provides a turnkey service for recording artists and film producers who want to sell directly to consumers. His firm currently handles e-commerce and fulfillment for approximately 300 sellers.
When asked to point out some Long Tail action, Young talked about his client Free Speech TV, that operates a channel on the Dish satellite service. FSTV’s e-store offers dozens of DVD’s including titles featuring Bill Moyers, Ralph Nader, Noam Chomsky, Jim Hightower, Helen Caldicott, and Naiomi Klein.
“Free Speech TV has a specific perspective on current events which attracts people who are distrustful of those in power. In today’s climate, many are not inclined to support large corporations. They are very loyal once they find an outlet that they trust. So if one of these fans sees a documentary they like on Free Speech TV, they want to give Free Speech TV their support by purchasing the DVD directly.”
I couldn’t help but wonder if this target audience, like the punk rock audience, enjoys expressing their identity through the discovery process and purchasing experience. Again, there’s not much room for that kind of self-expression if you buy your potent political DVD’s on Amazon, the same place where you get your electric toothbrush.
Young believes that direct-to-consumer commerce is the wave of the future for Long Tail items. Yes, Amazon and other aggregators will sell small numbers of each niche title, but Young is convinced that both artist and consumer benefit when they cut out the middleman.
“Going to Amazon can get the item to the fan, but going directly to the artist creates a fulfilling, lasting relationship. As a content creator, once you have a direct customer, you can strengthen that relationship with ‘thank you for your purchase’ emails, new release preorders, exclusive tour presales, etc. At the end of the day, building a relationship with your fan is the most important thing to enable the tail to grow and become a sizeable revenue producer.”
Issue #1 of Greg Spotts’ weekly Digital Media column on FC Now.