I have recently roughly read through the book——The Long Tail introduced on COMM101. The book mainly introduced the long tail theory ——how companies gain larger market share than its rivals by focusing on the products with lower demand or smaller volumes. 

 

Amazon could be referred as an example by employing the Long Tail to fulfill the misses demand in the market as shown on the graph.According to the research done by Erik Brynjolfsson ,Yu Jeffrey Hu and Michael Smith,about 36.7 percents of total profit for Amazon were contributed by the niche market. （2005）The reason that  tradition bookstores do not explore the niche market is that limited actual space for products. Conversely, for the online retailers,like Amazon,they are capable of storing almost everything. Another example here could be Google uses the niche adwords to expand their advertising business .As a result,70% of Google’s total profit are advertising. 

However, if the ‘large tail’ is smaller than the ‘short head ‘or the company is not large enough,then the margin cost may not outnumber the margin profit. The long tail may not work in that situation.

Reference list :

http://markproffitt.com/2008/01/11/ron-paul-revolution-history-in-the-making-my-new-book/ (graph for long tail)

http://www.amazon.ca/The-Long-Tail-Business-Selling/dp/1401302378（book image）

http://searchenginewatch.com/article/2340777/What-Do-Googles-Earnings-Reports-Tell-Us-About-AdWords-Trends

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1679991