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April 2007 - Posts

The Long Tail vs Auction Based Pricing

Is it still fashionable to talk about The Long Tail?

Assuming it is, Chris Anderson’s principle is that the inventory in the tail can be sold in low volumes but at high margins.  All well and good – and logical.

However auction-based pricing is getting a lot of traction in the online community these days, and those in the Search business in particular will know that it’s actually the high volume words that command the highest margins. 

So should the two principles be compatible in any way?   I recently had the opportunity to ask Chris Anderson himself, and he didn’t answer the question (twice). 

What do you think?  I guess it could be just another example of the industry polarising into extremes, as the Internet strips out friction in the market?   

Posted Apr 14 2007, 04:47 PM by DAMIAN BLACKDEN with 3 comment(s)
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