Week 7. ASOS and the Long Tail Theory

A Day in the Life of an ASOS Package – I could not embed the video but its worth a a quick watch.

Have you ever bought something from an online seller?

The majority of people would answer yes to this.

I personally have bought plenty of things online, and the more I buy the more I want to buy. It is cheaper, easier and more convenient than going to the shops and trying to find what I am after. Chris Anderson introduces us to the ‘long tail’ theory – where we can access more items than ever before online. I shop online regularly with the store ASOS.com. It is based in the UK, they provide free shipping to Australia, and it is quick. The parcels usually take about 5 days to get here which is AMAZING. Especially when you want something to wear for an event and you don’t have much time.

So back to the long tail theory, Anderson uses the example of Amazon and their ability to sell a book a decade after it was printed. A mountain climbing tragedy book to be specific, using recommendations they suggested to buyers of the book “Into Thin Air” by Jon Krakauer that they may like “Touching the Void” by Joe Simpson, which was the book written in 1988. It had long been forgotten by readers but just with this suggestion people started buying it, and therefore started an increased need for this book. A loop was formed, people buy a book, amazon suggests a book similar, the customer then purchases the book recommended and the loop continues. This ability to bring not so well known materials into the consumers vision was revolutionary.

ASOS is a huge company, not in employee size or amount of stores worldwide, but in items. They have, just in the dresses section of the website 1403 styles available. Could you imagine that many in a physical store? No way. So I click on a dress I like, then ASOS suggests to me another dress similar style that I may like. I usually end up buying a number of items from suggestions/recommendations. This ability to provide an infintate amount of products allows people to be able to buy obscure items which are not in the top 20% of products sold, and also for ASOS to stock these products (the remaining 80%). They don’t pay more to have them hanging in a shop, they can provide a warehouse which has a much larger capacity to hold the products. I LOVE THIS.

The physical world is so constrained. Shops can only hold as much stock as physically possible and reach a local market. With the boost of online stores, worldwide people have more choice, more options and much more power in saying what they want.

An example of recommendations from ASOS:

I click on a dress:

Pops up recommendations to complete the outfit with shoes:

and also these tights:

References:

Anderson, C. (2004). The Long Tail. Wired, 12.10 [URL: http://www.wired.com/wired/archive/12.10/tail.html%5D

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8 responses to “Week 7. ASOS and the Long Tail Theory

  1. It’s a tremendous system for consumers alright. It’s a shame we’re still limited by export/import regulations and whatnot. I’m still not sure if it’s possible to order electronic goods from Amazon, but last time I checked it wasn’t. Bummer.

    What I’d like to know is, with online sales becoming more popular in many forms of business such as books and clothing, what kind of market we’ll have by the end of things when we’ve moved everything we can online. As it currently stands there seems to be less and less benefit to sell directly rather than online, so it’s not unreasonable to assume that as many business as possible would eventually, or at least like to use this kind of system for selling.

    However, there’s some things that would simply be impractical or even impossible to buy/sell online. Would you let somebody order goldfish online and send them through the post? What about cars or even heavier vehicles. It’d technically be possible to transport them to people but it would take a ridiculous amount of effort to get it set up so that a car can be delivered to somebody’s doorstep.

    Assuming stores keep moving online, and I would actually like them to, what will the shopping centres of the future look like? No books, no shoes, no clothing, probably no supermarkets. Would people still hang out there, or would there be nothing left to do except maybe eat or purchase such ridiculous items that they can’t even be shipped?

    Not to mention the cashiers or retail workers. That’s an enormous number of entry-level jobs turning to dust.

    Although, it is in the future so who knows where shopping is headed next? The market will probably find a way to work itself out no matter what happens.

    • Ha, wouldn’t that be hilarious if you could get a goldfish in the post. You’d definitely have to sign for it. I was watching todaytonight the other day (please don’t judge – it was the only thing on!), and this woman had purchased a $2000 car online for her daughters birthday. She transferred the money via Western Union and she never received the car and the seller won’t reply to her. Firstly, I see this as a bit of a stupid thing for her to do, because transferring money via western union means that eBay have no record of her paying the money, so there was nothing that they could do. So I guess there is an element of risk when buying online.

      I’ve never thought about the loss of jobs in the future, maybe the workers can work at the post office to deal with the extra parcels that pass through..just a thought!

      • I have a friend who ordered a scorpion online and then it was shipped to him.. As for a goldfish, I wouldn’t be surprised if there was a company who did this.
        I didn’t really think about the Long Tail theory in relation to clothes, it was an interesting perspective. Suggestions and ‘if you like this, you might also like to look at..’ are important marketing tools. I even appreciate it to an extent, especially on YouTube, the amount of bands you can discover because of these suggestions.
        It can seem like a bit of an invasion of privacy, when Facebook goes through your likes and profile to market ads towards you, but I guess that’s just one of the problems with being a part of the network.

  2. I love your post!!! I too am also a avid online shopper and am a complete sucker when it comes to the recommendations. I go online looking for a dress and end up buying a whole outfit!! In my blog I also linked the notion of the long tail in with clothing, as i think it is a great example when showing talking about the 80/20 rule. The fact that physical stores can only stock that the 20% of popular items while online stores show no limit in their stock quantities. If you were interested, I was just reading online and came across this blog http://www.economie-numerique.com/is-the-long-tail-measurable-in-the-clothing-and-apparel-retailing-industry/ which goes a bit more in depth when linking the long tail to retail clothing 🙂

  3. The 80% of goods you would not generally find in a retail store but find in abundance easily online is in my opinion the greatest benefit of the long tail effect. Perhaps this feedback loop you describe is the reason hipster fashion has become so popular? everything old is new again via amazons suggestions.

    This new market will allow so many niches to flourish as time and space no longer act as the limiting factors they once where.

  4. I love ASOS! I have the app on my iPhone to feed my online shopping addiction. I am a lover of online shopping. There’s something about buying shoes at 4am when your pay goes in that is just so satisfying. Especially when you put the effort in to go in store and their is a lack of stock.

    I personally think that we’ll never completely cross over to only online shopping. Like you said, there’s just some things you can’t post. And not everyone likes the anti-social notion of shopping through our computer, TV and phone screens.

  5. I think you make an interesting point about people losing jobs. The optimist in me thinks that they will need to be retrained and rather than be a cashier, they help operate the online process, efficiency means there will be more businesses so there will be plenty of jobs.
    Of course what is more likely is they move to another company who is still operating in a more traditional model.
    I think this is a concept that we have overlooked a lot in this subject. Through all the good that comes from increased efficiency and movement towards online operations, there will be the ‘little’ people who lose out in some sense.

  6. Great idea!!! I agree with you, i like online shopping, it is always cheaper in comparison to buying something in the physical market place, because of the distribution and relatively small workforce, and we are benefiting from it.

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