Strategy in Global Economy

Answer ONE of the following questions: (800 to 1,000 words; 3-4 pages, double spaced; 

Question 1: The Long Tail and the Blockbuster

Chris Anderson and Anita Elberse seem to be identifying opposing trends. On the one hand, Anderson describes a shift from a world of scarcity to a world of abundance. According to his Long Tail thesis, the new world of abundance (brought about by widespread digitization and innovations from Bezos et al) has uncovered a market without end. Niche CDs and DVDs that would have been prohibitively expensive to stock in retail stores can live on a server and be sold and delivered with negligible overhead costs. While almost none of these niche products will sell in large numbers, their sheer volume coupled with how cheaply they can be stored and delivered has meant that, as an aggregate, they are an immensely profitable part of their respective markets—“‘the biggest money is in the smallest sales.”’ (Anderson, 25). On the other hand, Elberse suggests that “in today’s markets where, thanks to the internet, buyers have easy access to millions and millions of titles, the principles of the blockbuster strategy may be more applicable than ever before” (11). A blockbuster entertainment “event” stands out amidst the internet clutter. Both authors support their cases with strong evidence and compelling examples. Assuming that they are at least to an extent both right, how do their accounts fit together?

Using examples from our discussions in class and the readings, explain how Elberse’s Blockbuster Strategy is compatible with Anderson’s Long Tail.