The Long Tail is a new concept that impacts business, is driven by technology, and named after a type of statistical distribution. Confused yet? Don’t be, it is not complicated, yet it will drive a lot of future (and present) business models.

Simply put, products that have low sales volume can collectively make up a market share that rivals or exceeds the few current bestsellers.

Examples include Amazon.com and Netflix. "The Long Tail" is the potential to sell to the mass of people that want unique item, not a bestseller.

The term is taken from the graph that is created when charting the popularity of widgets (sales) to the inventory of different types of widgets. For example, in the graph shown on this page, the number of different widgets is along the bottom line, while the popularity rating (sales) is along the vertical axis. The total sales of low popularity items rivals or exceeds the sales of of high popularity items.

The concept can also apply to Internet searches. There is a "long tail" of Internet searches, in that there are a lot of people searching for the top search terms, and the number of people searching for additional, unique terms, trail off.

Real World
Think about Amazon, for example, vs. the regular, physical book store. The book store inventories the most popular books to try to reach all those best sellers on the left of the chart. Amazon, with its vast selection, may sell some titles to just one person (on the right of the chart). But, there are a lot of people on the right of the chart, buying products that maybe a lot of others don’t want.

Storage and Distribution Costs
It’s all about storage and distribution. Technology has allowed sellers to have very low inventory storage and distribution costs. So sellers find it more and more profitable to sell relatively unpopular products. In the past, storage and distribution costs were high, so only the most popular products could be sold, because sellers had to be choosy about what they offered for sale, so that storage and distribution costs would be low.

Also, technology, like the Internet, applications, and databases have improved to allow cutomers and sellers to actually be able to keep track of large amounts of inventory effectively.

So, the magic is, that within the same population, technology will allow us to sell to a "new" market.

History
The phrase The Long Tail was first coined by Chris Anderson in a 2004 article in Wired magazine.

Further Research
For further research, and the latest info, don’t miss The Long Tail Blog.