Thursday, July 17, 2008

Long Tail?

"Rather than bulking up, the tail is becoming much longer and flatter. That is the truth of the long tail."

Anita Elberse, Should You Invest in the Long Tail? Harvard Business Review, July-August 2008

What foundations, large or small, are not doing some type of strategic planning? Each cycle of planning surfaces new concepts and language that promise to help identify breakthrough ideas and big impacts -- like the holy grail of scale.

I've talked about a few of these ideas like "strategic inflection point" and wholesaling in my posting Standing up for Retail.

So, the long tail. The bible is Chris Anderson's The Future of the Long Tail: Why Business is Selling Less of More. The "tail" in question is skewed sales curve of products that shows lots of sales for a few "blockbusters" and a declining sales volume for multiple, niche products. Anderson's argument is that the Internet has lowered the cost of keeping niche products available and the search costs for customers to find them. In other words, niche products are advantaged against the common wisdom of focusing on the big hits.

Elberse raises some serious empirical questions about this hypothesis, raising the spectre of the blockbuster. But how is "the long tail" relevant to foundations? I'm still mulling on that and would appreciate some enlightenment? But I have a few ideas.

It could mean a division of labor. Some foundations focus on the big, wholesale solutions -- because they want to, they have the money, or its the desire of the founder. Other foundations, of all shapes and sizes, operate in the long tail, promoting niche solutions to problems or subproblems or embracing complexity and multiple niche answers as opposed to the one big solution. You can see how these approaches could be complementary. Some foundations do both. The problem becomes when niche players feel compelled to talk about scale and blockbuster players think their solution is the only game in town.

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