Ways Product Bundling can Take Your Business Forward
Youβre at the Mcdonaldβs store and order for a burger. The waiter asks you, βWould you like to make it a combo?β
That is what Product Bundling is about.
With the dynamic state of the market, businesses are constantly searching for new and innovative ways to boost sales. Product Bundling has set its place as one such trending practice in the market right now.
The idea is that several different products and services are grouped together into a single comprehensive package which is then sold at a discounted rate. Through this strategy, profits can rise due to the collective purchase of more than one item. With the sale of more items overall, consumers enjoy decreased prices and businesses see a faster movement of inventory off their shelves.
The Psychology of Product Bundling
Product bundling is based on customer value perception. Value perception is founded on consumer impressions, awareness and acceptance towards a brand and its offerings. If consumers see some value in a product, only then will they be motivated to purchase it.
Customers basically look for 4 types of value in products-
- Functional value
- Monetary value
- Emotional value
- Social value
The primary reason for the success of product bundling is that it increases the value perception in the eyes of the consumer. Product Bundling pricing gives a discounted price range along with the added convenience of a matched product. This makes for a great shopping experience and cost-efficient bargain in the mind of customers.
Product bundling also influences subconscious buying decisions. Itβs a great strategy for e-commerce fashion sellers. Shoppers have to shuffle between multiple tabs to determine which top matches with which pair of trousers. Instead of them going through this elongated process, you can offer an entire outfit at a discounted rate to make their buying decision easier. This also leaves the customer feeling like theyβve struck a great bargain!
Putting Together a Product Bundle
When done right, Product Bundling is a win-win for both customers and sellers. Yet, it requires much fine-tuning before implementing it. The most important part is understanding your customers. This can be done in two ways-
- Develop Product Bundles to test buying behavior
- See what products customers buy together
For the first strategy, you can consider product bundling by product category. A product bundling example would be, say, you assemble a βtravel essential kitβ including sample sachets of shampoo, conditioner, body wash, and sunscreen lotion. Each of these items falls under the beauty category.
The second strategy works the other way round. Assume youβre running a skincare company. You may notice that customers tend to purchase matching bottles of body wash, body lotion, and perfume together. Itβs a sensible move to package these together and sell them as a set at a discounted rate so customers feel like theyβre getting a great deal on their skincare purchase!
Benefits of Product Bundling
Although not a new concept, Product Bundling is beneficial for both retailers and customers.
Business Perspective
Higher Speed and Efficiency in Order Fulfillment
Product bundling increases profits in many indirect ways. When a customer places an order for multiple items separately from an e-commerce platform, the individual vendors must prepare each itemβs packaging, shipping, and after-shipment tracking. When a bundled package is prepared for delivery, it is quicker to fulfill more orders in comparison to individual items. Additionally, bundling increases efficiency because while taking stock of inventory in a warehouse, it is much quicker to count bundled merchandise than to have employees spread their time traveling across the warehouse, auditing for multiple items.
Increase Average Order value
Average Order Value is the total revenue generated per checkout. The main aim of bundling products is to entice customers to buy more products at once. As a result, you can increase your average order value, consequently your overall sales and revenues from your e-commerce store as well.
Easier Inventory Management for Related Products
Bundling relevant products together eases inventory management for those related items. This works in two ways. First, you can club a new product with an already popular one. This way you test the new offering in the market and evaluate customer acceptance towards it. By grouping a new product with an established item, you can promote the former more easily amongst customers.
Second, bundling products that areΒ slow-moving with bestseller items for a reasonable price can clear out the sluggish inventory and help to balance out any imminent losses.
Opportunity to Cross-Sell
Since not all products are compatible with each other to bundle together, the first step is to curate products naturally go together, which you can cross-sell. Important questions to ask would be which are products are more likely to be purchased together, adding which low-priced product could increase the overall value of the package or which additional product could increase the value of the product purchased.
From the customer point-of-view, many times, customers purchasing multiple products have to wait until after buying to check whether their purchase matches with each other or not. If not, their frustration could lead to negative reviews for your brand.
To avoid such dissatisfaction, customers depend on sellers to enlighten them about compatible items. For eg., if a retailer bundles a smartphone with a portable charger or phone case, then the customer will have made an expert-based buying decision, without doing any research of their own.
Taking a clothing example, a customer is looking at a pair of jeans and wondering how to make an ensemble from it. You can specifically curate a bundle that pairs those jeans with other items from your store like a shirt and shoes. The bundle gives your customers the variability to decide whether to purchase the whole item or each item separately.
Customer Perspective
The idea behind product bundling is that when purchasing a combo, customers feel like they are getting a good deal. With this positive association, they are more likely to return to your store in the future.
An additional benefit for customers is convenience. With a single click, customers can buy a set of products without having to browse through your store and manually add each item to the cart. For example, think about a home decor store selling a range of curtains, pillow covers, and bedspreads in the same style. If you wanted to encourage customers to purchase the whole set, you could advertise to customers with pop-ups before they navigate away, or show related products to guide their purchase.
Bundling Products with an Inventory Management System
On a slightly technical note, you could utilize an inventory management system for bundling products. With sophisticated software in place, you can sell your Bundles while keeping track of inventory levels for individual SKUs.
Product Bundling also forces your attention towards the lowest-selling products. It offers you the opportunity to eliminate products that arenβt selling well before they turn into dead stock.
Final Takeaways
If you havenβt explored it yet, product bundling is worth a try. If you get the correct product combination, you could see visible results in unit sales volumes, ticket value for each customer, and greater exposure to new customers.
Bundling products also gives you a competitive edge over rivals since it makes your pricing intelligence elusive. Itβs a mutually beneficial selling tactic for customers and sellers. Buyers can get speedy solutions to their shopping needs along with a good bargain, while businesses can increase efficiency in order fulfillment and revenue generation.

Kriti Agarwal
Avid reader. Daydreamer. Perfect Saturday evening is a cup of coffee with a classic book. Mountains over beaches. Loves animals. Always craving for stories. Writer at Orderhive.
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