The 80/20 Rule and Long-Tail in the Online Auction Market: A Case Study on YAHOO Auction, Taiwan
Shu-Chiung Lin, Shu-Mei Hsu, Jang-Ruey Tzeng, Andrew Chou
The online auction market has been growing rapidly, but what are
the significant effects on Taiwan? Based upon the 80/20 rule and
the Long Tail, the paper started its observation by taking Yahoo
Auction platform as a case study and found a negative co-variance
existing between performance and the number of online sellers. A
further analysis showed that these 20% sellers promoted more
items of goods online than numerous online sellers with less
efficient performance. The former ones were found to have
attracted more patronage than 80% of the sellers do, and they were
capable of promoting both popular and rare goods, which led to
sustained revenues in E-commerce. The paper concluded that 80%
of economies of scale in the online auction market are
characterized by higher performance sellers that constitute 20% of
the whole participants, a sign that proves supportive of the 80/20
rule. These 20% sellers display more items of goods online and
create more revenues than those of the lower performance sellers
do, a sign that reflects the Long Tail. The co-existence of the 80/20
rule and the Long Tail, may serve as a preliminary study for
further academic research. Full Text
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