Marketing to the Long Tail

The long tail (define) holds that outside the mainstream, there’s a large, diverse, and potentially underserved market. Depending on what figures you believe, this underserved market may actually be larger than the mainstream market, particularly over the long term. For a growing number of products and services, reaching the underserved market is becoming the primary goal, and online marketing appears to be the way to get the job done.

Consider long-tail dynamics. Long-tail consumers are defined in part by a highly developed sense of individuality. From their perspective, they’re outside the mainstream. This may be a perception (“we all wear black as a statement of our own individuality”), or it may be real. People who grow their own food out of concern for the earth are certainly a small subset of those who eat, and in many ways they really are different from the mainstream. Understanding those differences and serving them are the key to effectively reaching and converting these consumers to your brand. The driver for this is the second element of long-tail dynamics: small networks.

In many underserved long-tail segments, the presence of a physical network (a small community in the desert, for example) or virtual network (an online network of people with a very specific, uncommon illness) helps shape, define, and carry forward the community. This network forms a sounding board for almost everything that goes on inside that community. In particular, these networks are vehicles for validating new ideas, products, and services that may benefit that community. If you aren’t represented in that network, you’re invisible.

Marketers have, for the most part, been taught to do the opposite: ignore the fringe and concentrate on the mass. Measure the results in market share, and press for increases quarter after quarter. This approach served us well for the past 50 years, give or take.

But things are changing. Having recently been bested by Toyota, GM now declares it’s no longer about share. Marketers in general are finding it difficult to squeeze more share out of existing markets so are turning to new ones opening up globally. Last week, a friend sent news from SÃo Paolo: outdoor advertising has been banned in that city. To the astonishment of many, citizens and even businesses support the ban. They’ve decided it’s in their best interest to present a more attractive SÃo Paolo for the sake of tourism and less attractive to use every available square inch of outdoor commons to hawk something.

Add this up and you’ll start to see the way forward and why online marketing is so important. Imagine the combination of DVRs, don’t-bug-me lists, pop-up blockers, spam filters, multitasking, and the occasional city that, like SÃo Paolo, decides to curtail outdoor ads. That really does reduce the available mass pathways to consumers. Then what?

It will almost certainly drive up costs for remaining inventory, making alternatives such as digital more economically attractive. More important, more consumers will start looking to marketers like classic long-tail consumers, essentially invisible unless a network connection between the marketer and consumer exists.

The challenge, therefore, is creating that connection, and that almost certainly means online marketing. I’m not talking about banner ads and basic rich media. Nor am I talking about “cutting through the clutter.” Advertising, as it’s currently practiced, is the clutter. The way forward is to integrate your message into consumers’ conversations. It’s about integrating your campaign into the social networks your potential customers frequent.

What types of markets are likely to respond to these techniques? Consider active travelers, people who go off the beaten path or seek real adventure away from the usual resorts. They do a lot of online research, and they talk a lot with others who share their passion. How about the market for automotive upgrades? It’s a hot segment, and dealers are losing to retailers because they don’t aggressively market parts and service, the real profit centers in most dealerships together with financing and insurance, to customers in the same way they market cars.

The entire green movement is flourishing online in the form of user forums and connected networks. Smart marketers are effectively building barriers to “corporate green.” Wal-Mart is facing opposition even as it tries to do the right thing by bringing organic foods to market. Last month’s tainted pet food crisis doesn’t help. Objections to Wal-Mart as an organic provider are inextricably linked to the dysfunctional export/import controls that made the pet food issue possible. People growing their own food recognize the only way to be sure you know what you’re eating is to grow it yourself. That kind of logic, combined with news coverage of tainted pet food and a small but effective personal social network, goes a long way.

This is what marketers are increasingly up against: Consumers, many of whom are ordinary, mass consumers by any other measure, are now connecting and sharing information. It may start with a single cause or issue, but as soon as that average consumer finds out just how easy it is to get and share important information on one topic, you can bet she’ll adopt that behavior across a range of interests. Suddenly, she’s long tail.

This brings us full circle: the long tail holds that outside the mainstream, there’s a large, diverse, and potentially underserved market. Social networking is rapidly expanding that diverse market and chipping away at the mass. Use your online resources to serve those customers and, in doing so, establish a foothold in the long-tail markets.

Join us for the ClickZ Specifics: Advertising in Social Media seminar on May 21 in New York.

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