Long Tails vs. Superstars: The Effect of Information Technology on Product Variety and Sales Concentration Patterns

Abstract

The Internet and related information technologies are transforming the distribution of product sales across products, and these effects are likely to grow in coming years. Both the Long Tail and the Superstar effect are manifestations of these changes, yet researchers lack consistent metrics or models for integrating and extending their insights and predictions. In this paper, we begin with a taxonomy of the technological and nontechnological drivers of both Long Tails and Superstars and then define and compare the key metrics for analyzing these phenomena. The core of the paper describes a large and promising set of questions forming a research agenda. Important opportunities exist for understanding future changes in sales concentration patterns; the impact on supply chains (including cross-channel competition, competition within the Internet channel, implications for the growth of firms, and the balance of power within the supply chain); implications for pricing, promotion, and product design; and, ultimately, the potential effects on society in general. Our approach provides an introduction to some of the relevant research findings and allows us to identify opportunities for cross-pollination of methods and insights from related research topics.