Capturing a Fat Part of the Long Tail

By CL * Other CL Posts

Much has been written in the last few years about the Long Tail: the idea that a large and growing part of the economy consists of selling small quantities of many niche items to the few enthusiasts that desperately want them. It has been applied, in various ways, to many sectors of the economy, and I think it's interesting to see how it applies to one in particular.

The sports apparel industry has long been active in the United States (and several ATC contributors have some experience in the field). It has many sectors and styles: replica uniforms consistently sell well, throwbacks had a brief but intense period of popularity, and superstars and hobbyists alike want to maximize their potential with performance-enhancing shoes and training gear.

No startup company is going to knock off Nike, Reebok, adidas, or any of the other huge companies which have firmly established themselves in all corners of the market. But two young companies have made huge strides in the last few years by carefully defining their target consumer, then gaining their trust and faith by making it clear that they weren't interested in anyone else: Under Armour and UNDRCRWN.

Under Armour was founded in 1996 by a former college football player, and rose in popularity as athletes of gradually greater stature experienced and attested to the quality of their training gear. They consciously avoided going for true mainstream appeal, going so far as to "[restrict] sales to sporting goods stores, military-base exchanges and sports- and military-oriented outlets." This focus on the hardcore athlete (real or imagined) paid off; when combined with the intense imagery of their advertisements, it gave Under Armour an authenticity that Nike - too busy collaborating with Cole Haan and selling golf umbrellas - could never enjoy.

Taking precisely the opposite tack is UNDRCRWN, maker of my current favorite t-shirt. Their motto, "There Are More People In The Stands Than In The Game," reflects this idea perfectly - as much as weekend warriors may want to play like their heroes, they spend much more time watching them than they do emulating them. And they need something to wear while doing so. They've collaborated with musicians (including Asher Roth and Mos Def), dabbled in political commentary, and made all this even more clear a few months ago when they debuted the "We'd Rather Look Good Than Play Good" shirt, questionable grammar notwithstanding.

(In discussing this post, Ned pointed out a third company that falls in with these two: lululemon. I don't know much about their overall strategy, but in contrast to the two mentioned above - who operate online and through specialty retailers - they seem to have franchise stores that sell their own line of yoga-related sportswear. They've been growing fast and they seem popular; my one problem with them is that I looked at their sizing chart shortly after getting measured for a suit a few years ago and discovered that by their standards I was small in some measurements, medium in others, and extra-large in others. I'm not sure whether that means that I'm malformed or that they're overly precise.)

I'm sure this isn't news to anyone who pays attention to the sportswear industry, and if there aren't a handful of b-school case studies on each of these companies then there should be. But as a casual observer, and one who believes that ATC's readership is comprised of people who aren't experts in the field but might find it interesting, I thought it worthy of a post. The sportswear industry is dominated by a few huge be-everything-to-everybody companies, but there is plenty of room for small, specialized and focused competitors.