The Long Tail of E-Commerce

By: Abhishek Agarwal

The long tail of e-commerce is a model in which more of niche products are sold rather than advertising and marketing a single or two or three products which can go on to become bestsellers that are the sole source of revenue for the company. Customers today no longer want a bestseller as their interests are not the same anymore. With the availability of short online courses and master classes from teachers around the world, you can learn from a German film director about the nuances of filmmaking while sitting in your house in India and the equipment you will require for this will certainly be a niche item. This is just one example of how to become a professional by learning from the best at a considerably lower cost. However, the factors driving the demand for niche products are

Less Cost

Earlier the cost of an engineering toolkit or a basic home kit was high as the machines which produced them were costly but now with the advancement in machinery and low cost of manufacturing people who confined them to just learning are keen on experimentation and thus demanding more niche items which are used for specific purposes like a Goniometer to study the angles or a caulk gun to fix things well and become experts at their craft at a significant less price than the university’s education.

Simplified Distribution

Earlier it was a real challenge to sell niche products or even bestsellers to consumers who were not in the local or national market and this was mainly because a company’s reach was limited. This is not the case now as the internet has made every consumer a global consumer who can order from any company in the world and if that company does not deliver to his country then he can always look for a close substitute or contact the company which deals in the same things and can easily fetch the product for him although sometimes at a higher cost.

However, the emergence of cross the border e-commerce has not been driven only by these two factors.  The taste and preferences of consumers have been a huge factor in the boom of the cross-border e-commerce industry. Consumers have more than 5 different products competing for their money which serve the same purpose. From combs to shoe products made in another country have a different feel to them and instantly attract consumers who are somehow hooked to the way a product appears or sometimes the unique way in which it functions.

Tools, Labour and the ideation of a product is never same in two companies and this becomes a huge deciding factor in pushing foreign products which can either take the market by storm or not disrupt the market at all. Still, new companies should not radically offer only niche products as bestsellers have been bestsellers for a reason the reason for which is that people easily connect with them. New companies should go for both niche products and bestsellers with their strategy focusing on the presentation of best sellers as something different than the national and local bestsellers. It will create an impression in the psyche of the consumer which makes them think that what is being offered is not the same as the one which they have used repeatedly. This will lead to sales and generation of demand which will be vital for your company. Another thing to keep in mind is that you must know the pulse of the market when it comes to products and must not incur heavy losses when it comes to the products which have a very low chance of selling. Since the delivery time is longer than that of e-commerce companies which are not cross border you can save money by reaching an agreement with the manufacturer to manufacture the product only once the order is placed. This trick is sure to keep you in good stead and will result in higher profits. If bestsellers are the head of E-commerce then niche products are surely the tail but a new company must be intelligent and must have the high market knowledge to place their bets which are not high on risk and can make the company into a reputed one with its fresh rage of quality.

Competitive markets have existed since the dawn of the 19th century and will continue to exist even if we terraform mars but successful business models will come from time to time and create a lot of impacts based on their product rate and workforce. In the current scenario Cross borer e-commerce looks like the success of the future as Labour is cheap in China and countries of the African Nation, the machinery is available and most state-sponsored manufacturing units and plants are present which make cross-border e-commerce companies a force to reckon with and will definitely give both national and international e-commerce companies a run for their money.