
Bye Bye, Long Tail - sammville
http://techcrunch.com/2011/02/13/bye-bye-long-tail/
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slapshot
He has a point that the long tail of middlemen is getting crushed. There's no
reason to order routine consumer goods from anywhere other than Amazon.com or
a handful of other sites.

He gives a shout-out to retailers that offer improved shopping experiences. I
think there's still room there: I routinely order parts from a small car-parts
company that has the exact list of parts I need to fix my old car, and makes
it incredibly easy to find exactly what I need. If anything, the supplier is a
value-added retailer because they offer advice, tips, and will email me if I
order something really stupid (parts for the wrong year or model).

And he's completely wrong as to unique/custom products; the experience there
is almost the opposite. Hello long tail of unique, customized, and
personalized goods.

I routinely buy customized stuff from Etsy and similar artsy aggregators. It
is often stuff that defines the long tail: there is exactly one of each item,
but thousands of similar goods. A producer who can fill this need at scale has
plenty of opportunity.

I routinely buy letterpress goods straight from the press. Again, it's often
customized or personalized, and usually they will sell a few hundred units at
most. Again, opportunity in the long tail if you can find a way to fulfill at
scale.

I buy t-shirts and similar from an ever-evolving collection of online shirt
retailers. Some might use the same back-end fulfillment, but I know from my
local screenprint shop that there is still a huge (and growing) business in
short-run screenprinting.

~~~
bigiain
I think the t-shirt case is a great example of where Amazon/Walmart type of
purchasing power _won't_ always win.

I don't want the t-shirt with he witty slogan or amusing image that Amazon or
Walmart are selling by the thousands, I want to be the only guy in my city
wearing that gag.

I'm also never going to buy coffee beans from Walmart, I'm going to buy them
from one of my local roasters, who can often tell me the names of the farmers
who produced it as well as the level of roast used and the reasoning behind
choosing that roast level for this particular bean.

Commodities will end up being bought/sold as commodities, but not all
purchases are commodities. And some peoples commodities (like coffee and
t-shirts) are other peoples "specialty goods".

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kongqiu
Linkbait headline.

The "long tail" is still very much out there. As slapshot notes, Etsy has
opened up a completely new "long tail" that shows no sign of slowing down. As
is, say, airBnB...

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rst
Good points on how to compete with Amazon, if you choose to compete with
Amazon. (You do it on service, because you'll never beat them on price.)

But I'm not sure what that has to do with the original "long tail" thesis ---
that applied more to authors, musicians, etc., who are more likely to be
selling through Amazon than establishing their own retail operation on the
side. (And if they are doing direct retail, they're almost certainly selling
goods that aren't available through Amazon at all.)

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InclinedPlane
I don't think this article's thesis is supported by facts. Either that or the
author grossly misunderstands the concept of the "long tail".

~~~
brc
It's clear he doesn't understand what 'long tail' means. I think he conflates
the term to mean 'small retailers' when in reality the long tail is the large
amount of low volume items that consumers really want. The example he gives is
an example of demand moving out of the tail and into the head, where Amazon
and Walmart are interested. Amazon and Walmart both stock a wide variety of
items, with very low depth of stock in each category. From books to rifles,
Wal Mart only carries the big sellers. Amazon does offer the long tail in many
categories, but below a certain scale the small time deep dive inventory
people will still sell on Amazon marketplace.

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brc
I just had a similar experience. While looking to buy a $400 item, I found
someone with the item in stock who was willing to ship (note: not in the USA,
many merchants will not ship internationally, including Amazon on big-ticket
items).

After some back-and-forth, the order was placed, and this small online
retailer had my business.

But then - 5 days after the order was placed - an email came back. We want an
international wire transfer instead of mastercard payment. No way, I said - a
wire transfer is a black hole where I have no comebak. I offered a PayPal
payment instead. No, they said, wire transfer or nothing. I cannot for the
life of me understand this logic. It's not like I'm buying and shipping to
Nigeria or some other known fraud location. If it was about mastercard fees, I
would have happily paid a 2 or 3% surcharge. It still would have been cheaper
than having to drive to my bank, sit in a queue, organise forms and pay $20
for a wire transfer.

So the answer was no credit card, no sale, and they didn't get the sale. The
sale instead went to a combination of Amazon and a third-party freight
forwarding company. The combined price was about the same as the original
merchant.

Why anyone would offer to ship internationally and then request a wire
transfer is beyond me. Either shun international purchases (eg zappos) or
welcome them properly.

~~~
netcan
The problem is that in markets where goods are resalable, a very large portion
of sales are fraudulent. Being out of country makes the fraud likelihood even
higher. With paypal or mastercard payments, merchants have no protection
because of chargebacks.

Basically, after a fraud/non delivery/stolen CC allegation CC companies and
paypal will pull that money from the merchant's account and fully refund the
customer pretty much immediately and without question. It's usually impossible
or impractical to reverse that once it has happened, regardless of what
evidence you have. Police will not investigate and the CC company won't hear
your case.

I have had a client that personally delivered and item and got a signature.
When the chargeback claim came (non delivery), he recorded a phone
conversation with the recipient where she admitted (she was "tricked") to the
fraud. The police told him (after a lot of badgering) that they get about 100X
as many claims as they can investigate. Basically, for all but relatively high
stakes cases, they just log the complaint and move on.

There really is no way for retailers to protect themselves.

~~~
brc
I'm well aware of the difficulties with doing business internationally - over
90% of my income comes from outside my borders. I've gotten fraudulent
chargebacks and grit my teeth and move on. Sure, selling a $1000 laptop to
someone in Nigeria is asking for trouble, but for other countries with strong
legal systems and a low incidence of fraud I would seriously question the
accepted wisdom of international sales == higher fraud.

So if you don't want to deal out of the country, say you don't. Putting some
fine print buried in your website saying 'we only accept wire transfer for
international orders above x' but still accepting CC in the cart is bad
customer service. It's a crappy experience for the customer and it wastes time
for everyone, merchant included. This is my point. Statistically, I bet for
delivery to certain countries, the chargebacks would be no different to
domestic deliveries in terms of fraud per 1000 sales. The credit cards are
there to protect the customer from fraudulent merchants just as much as the
reverse.

My point is : either accept the risk (price it in if you have to) or advertise
that you don't ship internationally. This is what Zappos does - they want to
create an excellent experience, so they only ship within the USA. Don't create
a crappy experience for a customer in the off-hand hope that someone might
decide to get caught in a bait-and-switch payment scenario.

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gexla
The good news is that you don't have to compete with Amazon. You can sell your
own things through Amazon and you will always be able to attract traffic via
informational portals and link to Amazon to sell products which are the
subject of those portals and make money via the affiliate program.

Otherwise, I can't really argue with the article. I always look to Amazon
first to buy things. Even if I'm buying locally I will look to Amazon first
for reviews and pricing.

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bugsy
Weird article. Long tail of products is definitely here to stay with the
internet. Weird things, out of print books, fancy japanese pens I can't get at
the office supply store, movies that were never released in the states,
ingredients to strange ethnic dishes, repair parts for my antique whazzit,
it's all on the internet. A lot of the small places have things cheaper than
amazon too if you look around enough. Or save time and go with amazon.

