1.
The Long Tail:
Democratize Production
Digital Marketing
Group A
Andrea Arenas
Estevam Sa da Bandeira
Hugo Latorre
Leticia Salama
Matthias Holland-Cunz
Natalie Jadalla
Paola Martinez
Tomas Junquera

2.
Democratize Production
Democratization of the
tools of production to
customers Cost of Training Degree of Customer
& Production Specification Satisfaction

3.
A new Business Model
Before: Pareto Principle
“80% of your sales come from 20% of your products”
Don't just quot;work
Id & focus on Limiting the
smartquot;, work
those products to extension of
smart on the right
reduce Stock supply
things
Vilfredo Pareto
After: The Long Tail Strategy
The group that purchases a large number of quot;non-hitquot; items
is the demographic called the Long
Reducing the
Selling small
Increasing the focus on popular
volumes of hard-
supply of SKU items: less
to-find items
profitable
Chris Anderson

4.
Businesses in which the number
of items available is much higher
to their offline equivalents

5.
Music Store & Distribution Business
Customer seeking
unlimited offer
Virgin Megastore ITunes Online Store
Product Portfolio Storage & Prices Amount of Convenience & Prices
operating cost SKU`s Information
The lack of shelf space in iTunes allows for the offer of thousands
more titles and also more obscure ones at a better price.

6.
Used-Car Business
Crowd sourcing:
Cheaper and better
CarMax Store Carmax Online Store
Product Portfolio Information Prices Barriers of Product Prices
distance Availability
The consumer experiences limitations when
purchasing cars at the physical lot such as higher
prices & limited product availability

7.
Auction and Shopping Business
Make everything
available
Traditional Bazaar eBay Online Store
Traditional way Try product Prices Global Presence Convenience Supply and
of shopping before buying Reviews
eBay combines all available inventories from different
location points reducing physical limitations.

8.
Travel Business
One size does
not fit all
Travel Agency Atrapalo.com
Non customized Professional Valuable Personalized Customization of Economies of
package offers Advice Offers Advice Trips Scale
The results in atrapalo is unbiased, immediate,
and in greater quantity.

9.
Book Distribution Business
Hit products
versus niche
products
Barnes & Noble Amazon.com
High Volume Offers New and Inventory Global Inventory Niche Strategy High Demand
Focus Old Books Space Products
A niche strategy could help to avoid price
battles and focus on high profit products.

10.
Why did these businesses not exist 10 years ago?
Paradox: Less time to spare but more interests to pursue
Faster processes wanted
Technology was not available Increased usage of
along with convenience
credit cards

11.
Key benefits of the abundance of supply
Capable with online distribution and retail:
Price Battle
+ Real-time information available
+ Practically no storage and distribution costs
Large Volume Items
+ No physical limitation (unlimited shelf space)
= Possibility of lowering the prices
Profitability
Low Volume Items
Higher amount of
options to satisfy Mass Customization Multiple Taxonomies = Higher profitability
specific needs
Opportunities for Non-Famous Artists Cultural Diversity

12.
Who produces these articles: professionals or other users?
What are the implications for businesses and users?
Semi- Amateurs
Professionals
Professionals
BUSINESSES USERS
INTERNET PHYSICAL
INTERNET PHYSICAL
Abundance of supply
Sales
Serves all needs
Space and Product
Accessible
limitation
Support
Serves all niches
Face-to-face
Profitable

13.
Before the era of the Internet a product was either a hit or a miss
Hit Miss
Unlimited Shelf space

14.
What are the benefits of outsourcing the creation of content to the users?
Wikipedia benefits from:
Upgraded Quality Refocus technological and Organization agility
financial resources on core
competencies.
By adding content by amateurs and professionals, the business
benefits in terms of efficiency, productivity (speed up the flow of
information) and organizational effectiveness.

15.
Are economies of scale important to this business model?
Higher Volume:
High Volume: High
Hits + Misses = Increase
Net Contribution &
Niches bargaining power
Lower Costs
over suppliers
Economies of scale
Yes, Blockbusters
Satisfy mainstream Satisfy 100%
are hooks to
demand customers demand
attract audience
Are hits Needed?

16.
What is the impact not only on business but also on society of shifting
from a culture of scarcity to a culture of abundance?
• Larger customer base
• Increased offering of products
• Better knowledge about customers needs
• More competition and a informed customer
Business
• Information is power for Consumers
• People are satisfied
• Increase of expectations
• Higher demand of quality
Society

17.
Thank you!