Strategy and the Long Tail
There’s a lot written about strategic fit, about being agile and change-hungry, ready to create or seize market opportunities. But there’s a whole class of strategies about doing the opposite of that, being slow, holding onto what is. The Long Tail refers to the large numbers of products with low sales volumes (compared to the small number of products which secure very large sales volumes) and there’s good business to be had in niches in the Long Tail. Often (but not always), the Long Tail is particularly prevalent when a market or market segment heads towards the end of its life.
Edwin Land was founder of Polaroid and inventor of the world’s first instant camera, and he wrote: “Don’t undertake a project unless it’s manifestly important and nearly impossible.” You may well think that Polaroid was a brand and a company which was dead and gone? Enter Florian Kaps and the Impossible Project.
In the digital explosion of the early 2000s, he had noticed a small core of interest remaining in the seemingly dinosaur technology of instant film and cameras. There is something fundamentally different about an instant camera with instant film – the immediacy, in-your-hand feel of the thing. Interestingly, he had also noticed that those who were most excited were younger, were those who had been brought up in a digital. There was a sense of reconnection to real, concrete, working products, not just a lot of pixels. You can touch analogue products, feel the weight of them in your hand, you can hear and see the product doing its work. So Kaps started buying up cameras and stocks of film and made a business of reselling them.
The watershed came in 2008 when Polaroid announced that they were stopping film production at its last film factory, in the Netherlands: digital photography had brought Polaroid to the brink of bankruptcy. But Kaps knew there was a persistent market there, albeit one too small to sustain Polaroid. After fighting through a lot of hurdles, Kaps bought the factory – and with it the ability to sustain the niche he had built. Or had he? The factory didn’t actually make the film itself, it only made the chemical paste which developed the film, and the film was made in the US film factory which had also closed. So the challenge became to create a new kind of the instant film using all the machines and capability which he had bought as part of the factory deal – doing new science to uphold a very long-standing product.
Initially, the film quality was very unpredictable. But Impossible worked with its customers, both building and exploiting their joint passion for instant photography, and gradually improved. Today it sells 1.5m packs of instant film a year – and this in a market which Polaroid had judged to be dead. Along with the revival of vinyl, an unlikely analogue renaissance is flourishing, with technologies few thought could prosper.
The Long Tail isn’t for everyone. The strategy needs really deep customer intimacy – knowing what your customers need and want, and making sure you deliver to that, and using your R&D spend on things that are core. And in Kaps’ Impossible project, there is something else in play, holding onto heritage products and values, a sense of continuity with the past. His execution of a Long Tail strategy has the effect of creating a strong emotional element to the value proposition, making the customer part of something which feels special and different, and in the case of his younger customers, he is making it possible for each to have a photography experience they would otherwise have missed out on, the experience of taking a photograph and it being delivered directly into their hand.