The Long Tail

One of the ideas from the dot-com boom was that of the "long tail". If one ranks their customers by sales, then the best customers -- the ones that order the most -- are clumped to the left, and the customers that order the least are in a long thin grouping to the right. That long, thin grouping is "the long tail".

This idea came about in the mid-2000s. It was considered revolutionary by some (mostly those who pushed the idea) and it was, in retrospect, a different way of doing business. It relied on a reduction of cost to serve customers.

Prior to "the long tail", businesses marked certain customers as unprofitable, and built their pricing to discourage those customers. (Banks, for instance, want a minimum amount when opening a new account. There is a cost to manage the account, and the profits from a low-balance account fall below that cost.)

The "long tail" advocates recognized that computers and the internet allowed for low-cost interactions with customers, and saw profit in small purchases. The efficiencies of self-service, or fully automated service, allowed for customers with smaller or fewer purchases. New businesses were formed, and became successful.

Yet there were some aspects of long-tail businesses that weren't predicted. Those aspects are the absence of customer service and the treatment of customers as disposable entities.

Consider Google. The tech giant has several businesses in the long tail of computer services. They include e-mail, data storage, processing, office tools such as word processors and spreadsheets. Companies can sign up for paid plans (the "fat" part of the tail) and individuals can sign up for free or nominally free plans (the "long" part of the tail).

But notice that the plans for individuals (free e-mail and spreadsheets, for example) have nothing in the way of customer support. There is no help line to call. There is no support by e-mail. (There are web pages with documentation, and there is a web forum staffed by volunteers, which has some answers to some questions.)

Customer support is expensive, and the individual plans (either free or low-cost) generate such few profits for Google (on an individual basis) that a single 10-minute support call would wipe out years of profits.

Long-tail businesses don't offer real-person support because they cannot afford to.

But the headaches for the customers in long-tail products and services don't end there.

Google has, on more than one occasion, cancelled a person's account. The common explanation is that the person did something that violated the terms of service. What, exactly the person did is not specified, and there is no action listed to correct the problem.

I am picking on Google here, but this happens to users of other services, too.

What makes it bad for Google's customers (and Google, indirectly) is Google's wide variety of services. A violation of terms and conditions in one service can cause Google to suspend a person's account, which removes access to all of Google's services, including e-mail, spreadsheets, data storage, and more. Google provides no information to the customer, and the customer is effectively cut off from all services.

Google has discarded the customer. It seems a harsh resolution, but it is a low-cost one. Google does not spend the time discussing options with the customer; the cost of cutting off service is, essentially zero. Google loses the minimal profits from that one customer, but those profits don't cover the cost of investigations and discussions. It is cheaper to dispose of the customer than to retain them. There are lots more customers.

Long-tail businesses don't value customer retention.

These are two results of long-tail business models. I won't say that they are wrong. The economic conditions seem to require their existence.

And the market does offer alternatives. Microsoft, for example, offers support (limited, but more than Google) for its Microsoft 365 services. In doing so, they move the customer from the thin part of the tail to a thicker part.

The old adage "You get what you pay for" seems to apply here.