The Long Tail theory was formed by Chris Anderson and he thought of the idea of a graph that goes from the top right to the bottom left. At the top of the graph is the popular products which big companies such as Amazon, HMV etc will store plenty of these products due to there popularity. Then at the bottom of the graph is the nich products which companies will store a low amount of this is either because they are not popular or because they are from years ago. This theory effects are econmy because popular sales will sell more and the unpopular wont.
An example which I will link this theory to is films. Within films the big named companies such as Warner Brothers will produce more sales with cinema tickets and DVD sales, this is because they are at the top of Andersons graph. Wereas independent companies such as Big Talk will not have as popular ticket and DVD sales because they are a nich company and are at the bottem of Andersons graph.
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