Archive for the ‘Long Tail’ Category

Why it’s not the size of your business that counts…

We all remember that old saying “it’s not the size that counts, but how you use it”. Well, in business that hasn’t always been the case… until now.

The advent of e-commerce has resulted in a relatively even playing field for businesses. It seems that now, even as a small business, you have the same chance of grabbing the customer’s dollar as your larger competitor does.

One thing that’s misunderstood about online marketing, is that you don’t need to have the most flashy, graphics-driven site on the web. What you do need though is great content, and to distribute it through the right channels.

A recent article by eMarketer talks about how online marketing is resulting in massive changes in tourist research and buying behaviour. Specifically they mention how niche travel sites are overtaking the (often larger) online travel agencies in traffic and bookings.

More than ever, travellers are looking to RSS feeds, e-newsletters and blog postings (all tools that are well within reach of even the smallest business operation) to help them make their purchase decisions. That is, they are looking for information and stories from other travellers and the small businesses that are close to the action, not the large corporations with their flashy posters and catchy phrases.

This quote from eMarketer Senior Analyst Jeffret Grau sums it up nicely (and can be applied to all industries).

“Lower industry entry barriers have paved the way for new online travel business models. In this dynamic environment, current industry players must stay alert, otherwise they risk being blindsided by new competitors that fall off their radar screens.”

The secret to good milk…

Today we have more options than our brains can often handle. Take milk. Would you like that skim, light or full cream? More calcium or less sodium? Strawberry, mint, chocolate, banana or vanilla? Would you like that in a carton, a bottle or a jug? Powdered, fresh or long-life? Will that be paid by cash, cheque, credit or savings? Paper or plastic?

When your prospective customer is standing at the proverbial milk section, gazing at the seemingly endless options, what makes them reach out and grab yours? Essentially, you’re just a carton of milk; like the carton next to you, and the carton next to them and all the other cartons around you.

But there’s something unique about you. Sure, you’re a carton of milk like everyone else, but you offer something more. Your customer knows that when they’re pouring you on their cereal or in to their morning coffee, they’re pouring in added calcium, or a 10% saving, or the peace of mind you get from knowing that the cow this milk came from was grazed on environmentally-friendly grass in a big green paddock with absolutely no performance pressure at all.

Think about your competitors. What do they offer in addition to their core offering? Why do people by their product or service over everyone else’s?

Now look at your product. What is it that makes yours different to everyone else’s? Is it something customers would find valuable? And do they know about this unique trait of yours?

With so many options available, it’s nearly impossible to differentiate yourself based purely on your core offering. Very few people today buy purely to fulfil a practical need. Sure, that practical need gets them to the milk section. But it’s your unique selling proposition that moves them to choose your carton of milk.

The Long Tail of Marketing

David Meerman Scott, one of my all time favourite bloggers, has recently posted about his experiences with Apollo moon mission. Its a great post – have a read of it over at The Long Tail of Marketing and Apollo Moon Mission Artifacts

Banner Image for Farthest Reaches Space Artifacts siteDavid provides a great example of how the Long Tail creates opportunities for small business. The small business involved? A Space artifact dealer. For Farthest Reaches, all they need to invest to start a global business? A website, and content that connects them up to their community of interest. A blog is a great way to do this, however as you can see in this case, it isn’t necessary.

The key point from David’s post for small business owners is this:

“The space artifact dealers, for example Farthest Reaches, couldn’t have done business prior to the Web. The owner, Steve Hankow, could never find his market and we space collectors couldn’t find him. Now it is simple to market to people like me.”

When you reflect on what Farthest Reaches might mean for you, consider two different perspectives:

  • Existing businesses may have existing niche products or services that can be marketed online, and/or sold online. Online marketing is possibly the first step, online selling can follow.
  • Or maybe you can see the opportunity to find a new niche you can sell to.

The space artifacts segment is hotting up – time to stake your claim to the next big (small) segment 🙂

An Australian online business operating in 14 countries

I read a great review of World Wide Salon Marketing in My Business Magazine this month. It’s a perfect example of a long tail services business addressing beauty salons, day spas and hair salons. From their base in Perth they now have clients in fourteen countries. They help businesses market themselves by sharing marketing ideas.

As well as boasting a seven figure turnover this company is operating with a staff of six. Another online success story. Have a read of their website – they have a range of long copy sales letters, supported by information about how the business works in their About page. This is an inspiring example of what a small business can do online.

Six ways to identify online opportunities for your small business

The world in your hands
Are you taking advantage of the online opportunities for your business?

With Christmas just around the corner and the New Year nearly upon us, why not review your business strategy. What are the online opportunity areas for your business exactly?

Today, your small business can probably address a much larger market online than offline. And this usually means access to potential customers who may never have had the opportunity to buy your product or service before.

Work through these six areas and see how many opportunities are open to you.

1. Sell online

Are your products or services available for sale online in Australia? If not, should they be? Researching search traffic can be a good way to identify what kind of demand there might be for your products, and of course you can research your online competitors relatively easily.

Ok, so you think there is demand, but you’re concerned about the startup costs? Well, you’ve got some low-cost low risk options. You can start selling online using eBay, use a hosted online store and just pay a commission when you sell, right through to setting up your own eCommerce site. Even the last option – which used to be very expensive – is within reach of most small businesses. So if you think the demand is there, what are the real barriers to getting started?

2. Market online

If they are being sold online, are your products or services being effectively marketed online? Can new niche audiences find you?

You don’t have to actually sell online to benefit from long tail opportunities. If you can’t sell your products online, are there opportunities to market online – perhaps to find latent demand in niche export markets?

3. Existing products, new niches

Are there profitable niche markets for your existing products and services you are not addressing?

Would expanding your addressable market for your existing products find new, profitable niches? Imagine running a gift store in a country town. Now move that to the busiest shopping precinct in the country. All of a sudden you can stock a much wider range of goods, because there are more customers and more diverse interests. The same thing happens online – all of a sudden, there are lots more consumers out there, so items that were too niche to think about before might now be in demand. Think of it as latent demand, just waiting for you to address it.

4. Services for niches

Services on the web are still in their infancy. If you are a service provider, can you offer online services to niches that have not been well serviced? In Australia? Overseas? Like products, some niche services may also be in demand once the larger addressable market online comes into play.

Can’t offer your service online? What would you need to modify so you can offer your service over the Internet? How could you specialise and just deliver a part of your service online?

What latent demand exists in niches for existing or new online services? In Australia? Overseas?

5. Knowledge products

Can you convert aspects of your products, services or knowledge base into a niche knowledge product where there is latent demand? Could you make this knowledge available online through training products or e-books?

Or can you use your knowledge to educate others and interest them in your mainstream products?

6. Less generic, more specific

Looking at your existing products or services, how could you make them less generic and more specific so they become relevant for niche markets where latent demand exists?


I hope this gives you plenty to work with, and helps to inspire your business planning for next year. I’ve written an article that goes into a lot more depth about latent demand – what has caused it, and how it can be addressed. If you’re interested, drop me a line at and I’ll shoot you a copy – would appreciate your comments.

Go global, live well

Laptop on beachAn article in the Desert Sun – a Palm Springs, California paper – attracted my attention recently. Small Business Finds Profit Internationally is the story of one small US company that set up a European base by working remotely with an employee.

The article aims to show how easily a small company can set up physical offices in other parts of the world. More importantly, it shows how small businesses are realising how Internet media can enable them to think globally.

If we can employ staff at a distance, we can use the same technology to work with clients or customers anywhere in the world.

The beauty of small businesses is that they are perfectly poised to make the Internet work for them. Choose a niche product or service that can be shipped or supplied nationally or globally, and you’re in business. Leverage Internet options to market effectively online, and you’re likely to stay in business.
Boston Globe columnist, Penelope Trunk, recently enthused about the benefits of virtual companies: low overheads enable start-ups to get going faster, working online allows small businesses to compete on a level playing field, and the joys of working remotely are clear.

The Palm Springs employee decided to telecommute from Dublin and it worked. Now start imagining your ideal place to live …

How we do it
Measured in terms of number of employees, our business is small – very small. And yet I take great pride in describing PublicityShip as a national company. Because we are. Not only that but we also have the potential to ‘go global’ without setting up any physical offices.

Interesting though when my listener asks – so where are you based? This always throws me because, while it’s a natural question to ask, in virtual reality, it isn’t relevant.

Our geographical office is a place for Glenn, Julia, Shane and I to keep our computers so we don’t clutter up our houses. It’s where we get together to brainstorm and celebrate. But our journalists all have their own independent bases, and as far as clients go, all these physical locations are pretty much off the radar.

This is because we’re an online, or virtual, company – like so many other small businesses springing up all over the web. But being an online company doesn’t just mean having a website.
All our services are offered and conducted online or by phone conference – leading to time and cost savings that ultimately benefit our clients. This works particularly well for a service company like ours. But businesses selling physical products can have an online store with payment facilities. Even perishable produce can be frozen and transported – almost anything is possible.

So, where are we based? At the risk of sounding facetious, my answer is now simply:

What does the Long Tail mean for small business?

The Long Tail

Have you heard of the Long Tail? For a lot of small businesses, this topic matters a LOT. For some, it doesn’t matter much, but you’ll still find it an interesting read. The book on the topic is shortlisted for the Business Book of the Year. But its far more than that.

The Long Tail was an article written by Chris Anderson in Wired Magazine, in October 2004. He has subsequently done a lot more research and published a book. Great author, great article. So good that reading it convinced me to resign from a big-company consulting role and head out and start my own business. This post owes an incredible amount to Chris Anderson.

I’m going to try and put my own small business perspective on the Long Tail. Most (not all) of the discussion around the Long Tail has been from the perspective of big companies – this isn’t a deficiency in the idea, just a natural byproduct of the audience. But I’m going to try and persuade you that the Long Tail is very significant for small business.

Ok, so what is this all about?

Addressable market.

When the Internet was established, it was the beginning of a tectonic shift in addressable market. Basically whatever your product or service, you only get to sell it to your addressable market. Mostly this means your customers have to be able to walk/drive to your outlet, or you go to them. So for a successful small business there needs to be enough people within geographical range of your business who … want/need what you are selling, come into your outlet (or you go to them), notice your product, don’t buy from a competitor … and … buy! (see p.162 of The Long Tail and the Tyranny of Geography).

If you want to sell specialist products/services, you better make sure there are enough people interested in your speciality within geographic range, or else it’ll be pretty lonely.

The basics of supply and demand are not difficult to understand.

No Demanders = No Suppliers!

But – and this is important – it also means

Some Demand with No Supply –> Buy a Subsitute or Don’t Buy

The Internet has created a situation where the addressable market for some products and services has expanded in an astonishing way. This is the tectonic shift you need to understand. The shift hasn’t occurred because of technology – it has occurred because of supply and demand. It is the same old laws at work, but with a new addressable market plugged in to the equation.
So lets look at an example:

Example 1: Old Situation

Book about mountain climbing sold in bookstore -> addressable market is essentially 10-15kms. Law of supply and demand says to bookstore owner … people interested in mountain climbing are spread thinly, and not enough live in my feeder area so I WON’T STOCK IT!

Example 2: New Situation

Book about mountain climbing sold on website -> addressable market is based on # of Internet users and languages supported on website = huge market. Even though mountain climbers are still spread thinly, there are a lot of people interested in mountain climbing overall. So I will STOCK IT!

So if you have read even the first few paragraphs of The Long Tail, by now you will recognise the example of Touching the Void. This is the classic Long Tail case study, thanks to Chris Anderson’s article. And its not hard to understand that Amazon (not just a big company, a huge company) is selling lots of niche books now. Around 32% of all their books.

So the theory of the long tail helps us understand that niche products / services are actually of interest to lots of people. And we can see easily that when the addressable market is large enough (e.g. the Internet), what was an unprofitable niche may now be profitable.
So what does this mean for small business? Well, its time for you to take a long, hard look at your products, services and expertise. I want you to ask two critical questions.

  1. Do you have something that you can now sell to a larger addressable market, available to you over the web?
  2. Can you draw on your niche expertise to create a new product or service that would unprofitable in your geographic market but profitable in your web-sized addressable market? Big caveat here … depending on how you intend to benefit from the product/service, you may need to be able to transact online.

If you are still with me here AND you get what I am saying AND you think its an extraordinary time to be changing how you do business, please comment on how the Long Tail might apply to your business, or even better, email me (glenn at publicityship dot com dot au). I love exploring this idea for new types of businesses, because in just about every case you go looking you can find an angle, a niche that is highly profitable for a small business person! Not necessarily for a large business. There is a very good interview with Chris Anderson, recorded by Ken Evoy of SiteSell, that discusses the long tail and small business. Its quite long (as if this post isn’t), and I recommend it to you.

And this is what makes it such an exciting change for small business. Small businesses have a chance to carve out a very specific niche. Its not even a matter of competing on an even footing with larger businesses. The tyranny of geography means a lot of people can’t find what they want/need, so they buy products or services that are a substitute for what they would really like to buy. Or they don’t buy at all. What happens you offer someone a choice that is a lot closer to what they want? The answer is (and Chris Anderson gives a lot of evidence to support this) they choose what they want. This means they buy less of what they used to, and more of what they really want to. The demand in the long tail includes a lot of pent up demand from people who haven’t been able to get what they want. And small business is exceptionally well placed to respond to this unmet demand.

Well, what are the barriers to achieving this? Why isn’t everyone doing it? I have a lot of thoughts in this area – its what I do a lot of in one of my startup businesses PublicityShip ( I’ll post more on these topics, or if you email me directly, be quite happy to converse via email. One of the first topics I will talk about is the long tail of Ocularists!