Advertising to the Long Tail

by Akshay Garg, business head, Komli Media

I pity the first person to have read Chris Anderson’s article on the Long Tail in 2004 in Wired magazine. Imagine going out to lunch with someone and asking your meal companion, “What do you think about the Long Tail?” Assuming the meal companion hadn’t heard about the Long Tail yet, the obvious reaction would probably be one of stunned silence, or a quick dart of the eyes to your behind. Not to state the obvious, but the thought would be is my meal partner an atavistic freak?

My point is just that. The Long Tail was just an unnamed, obscure, statistical phenomenon until Chris Anderson and his Wired article came along. But, did he stoke a fire? Chris took something out of a statistics textbook, played with it a little bit and constructed a theory, which surprisingly, actually made a lot of sense in the wider world. The point of the theory, without getting into any jargon, is simply that, in certain circumstances, it might actually make more sense to reach out to your smaller buyers, who are much larger in number than your largest ones. Harmless as this statement is, it is not conventional wisdom. Conventional wisdom is that it makes more sense to reach out to the largest buyers alone, because the small buyers are too small and too fragmented.

That is where the internet, and more specifically, internet advertising, comes in. Unlike offline businesses where distribution and marketing costs can rise exponentially as buyers become smaller and more fragmented, in the internet space, the extra costs are just marginal, because of the pricing models offered by, at first, Google AdWords, and later on, by other reach-focused ad networks.

Advertising to the Long Tail wouldn’t be in vogue without the genius of Google in combining search with contextual advertisements and giving the opportunity to any publisher, regardless of his or her size, to display an advertisement from any advertiser. The maxim it followed was something pretty simple: that it didn’t matter to the advertiser where he or she got his or her target audience, as long as he or she got it.

Internet advertising to the Long Tail is often explained via the 80/20 rule. It is 20 per cent of all publishers who are perceived to be of the highest quality, with quality being measured as the volume of a relevant audience. The other 80 per cent might not have such a high proportion of a relevant audience, but added up, the relevant audience across this 80 per cent constitutes as much or more than in the top 20 per cent of sites. So why not reach out to this 80 per cent? That is exactly what many performance-focused advertisers across the world, such as Amazon or eBay in US, or MakeMyTrip or Naukri in India, now do.

So what are some of the pros and cons of advertising to the Long Tail?

Pros

Cost-effective: The Long Tail publishers are typically minnows, without sales-force or rate cards for advertising. They are happy to get what they can in advertising revenue. This makes it extremely cost-effective for advertisers to advertise on them.

Reach a Larger User Base: It doesn’t really matter, does it, if the advertiser finds his or her target user on a top 10 site or an unknown site? By advertising on the Long Tail, advertisers are able to find their audience anywhere and everywhere. It must be pointed out though that the delivery of results via the Long Tail is predicted on the success of contextual advertising. Advertising to the Long Tail would not be as successful if a product that is relevant to the content of the site was not advertised there.

Cons

Lack of Visibility or Control: You get what you pay for. Advertisers can get away with cheap pricing for advertising on the Long Tail but they lose some (or a lot of) control over the sites where their ads are being displayed and at what times. This is not really a worry for performance-focused advertisers, but it is a very real one for brand-focused ones.

Not Really a Branding Platform: Branding is all about association. Breitling, the premium watch brand, has John Travolta as one of its brand ambassadors. Why not me? John Travolta brings a certain exclusivity and class to the product that I can’t – at least that’s what Breitling thinks! The thinking of the prospective buyer is that if the watch is good enough for John, it is surely good enough for me. Premium brands, as a criterion for advertising, like to associate themselves with premium publishers (defined loosely as a hi-quality provider of content, or a publisher with a hi-quality audience, though in most cases one leads to the other). By definition, the Long Tail is not composed of premium publishers. A brand that wants to preserve its association with a certain class can do itself a lot of harm but advertising indiscriminately on the Long Tail.

In summary, advertising to the Long Tail has been a blessing for consumers and performance-focused advertisers alike. The most obscure goods, which would normally take a lot of finding, are now available via Long Tail publishers. Want to find a banana shaped pen that also displays time? Your ordinary neighbourhood stationary vendor would think you are crazy if you asked him for one. But there is a strong chance that you will find it, or something close enough, being advertised while browsing a website for pen aficionados.