Product Bundling Strategy

Companies develop various strategies to help them sell consumer products and increase their market share. Product bundling is a specific sales strategy where companies put two or more products together and sell them at a discount price. The discount price is typically less than the total of all individual prices.

Features

Product bundling can include related or unrelated products. For example, a company may bundle a cell phone, case and car charger at a lower price. Unrelated products may include selling a laptop bundled with a smartphone. Each product is distinct from each other and offers consumers more value for their dollar.

Benefits

Bundling strategies help companies drive sales by offering more value to consumers. Additionally, consumers who are "fence sitting" about purchasing a product may decide to buy if they can receive more products in a bundle package. Companies with a unique product or the ability to bundle specialized goods can offer better value to consumers.

Warning

Companies should not use product bundling strategies to unload old or damaged inventory products. This can turn consumers against the company if they perceive the product bundle benefits the company more than the customer.

References

• "Estimation of Willingness-to-Pay: Theory, Measurement, Application"; Christoph Breidert; 2006