Scaling Up Is Good. Scaling *Down* Is Even Better

Chris Anderson writes:

... In traditional business, small customers are all too often a barely-tolerated distraction on the road to getting big customers. They can cost as much to serve as their richer counterparts but generate less revenue. But digital businesses can be efficient enough to serve people who generate no revenue at all. Even if only a tiny fraction of them convert into paying customers, a small percentage of a very large number can still be a big number.  ¶  I call this "scaling down", and it's a core Long Tail competency. Traditional businesses target the top end of the market--the biggest hits and the richest customers--for the same reason that Willie Sutton robbed banks: because they think that's where the money is. If you have only so many salespeople and only so many marketing dollars, such a discriminating approach makes sense. But the lesson of the Long Tail is that, as Nobel physicist Richard Feynman predicted, "there's a lot of room at the bottom." ...

Link:  The Long Tail.  Great essay.  --Dennis