Product Sourcing News   

Heads or Tails?

How to Find Your Place in the Market

FEATURED COMMENTARY

By Chris Malta
Home EBiz Product Sourcing Expert

Often, the marketplace is referred to as having a “tail.” Popular, in-demand products make up the “head” with slow-moving, less-requested products trailing behind, forming the “tail.” Because retail chains have limited shelf-space, they carry only those faster-selling products so they can turn their inventory over again and again. They don’t have room to waste on products that don’t cater to the mainstream market. For example, Wal-Mart is the nation’s top music retailer, but they carry less than 3% of all music available to be sold.

Opportunity Knocks…
This presents a lucrative opportunity for you, as an internet seller. Those niche products that comprise the market’s “tail” tend to do better online. You have the potential to offer a huge diversity of products, and you don’t even have to stock them yourself. You can use drop shipping to identify which products sell extremely well, and then buy those in bulk for even greater profit margins.

And you don’t have to be a big player to get the entire market for more specialized products. Explains Mike Levin, of HitTail.com, “You actually have a greater opportunity to reach your potential leads than the larger retailers because they aren’t specifically going after those tiny niche markets.” And you have the ability to reach a wider audience than even chain stores because you have the search engines helping people find you and the products you carry.

When Less is More
There are additional benefits to carrying products that fall into the “tail” of the market. With extremely popular search terms, like “iPod” or “Designer Jeans,” paid listings are very costly and natural rankings are difficult to achieve. With relevant, but more obscure keywords, it’s much easier to drive targeted traffic to your site:
• With paid listings, bidding on the somewhat less “principal” terms further down the tail is inexpensive.
• Organic rankings are easier to attain because few people are optimizing their sites for those keywords.

You want to go far enough down the tail that your competition is low, but your ability to drive traffic is high, but not so far that no one is searching for the products you’re selling. Zero in on those sweet spots for optimization. Asserts Levin, “By using the right, albeit off-the-beaten-path keywords and copy, you generate potential customers through the search engines and improve your natural search performance.”