A combining several products or service into a single comprehensive package for an all-inclusive reduced price.
Price bundling
The amount of money expected, required, or given, in payment for something.
Price
Offering several products or services for sale as one combined product or service package.
Bundling
Is a technique in which several products are grouped together and sold as a single unit for one price.
Product budling
Also called product bundle pricing.
Price bundling
A business strategy where companies group several products together into a bundle and sell them at a single price, rather than attribute individual prices to each item.
This means that a bundle is now an individual product.
Bundled pricing strategy
(3) Types of bundling:
Joint bundling
Leader bundling
Mixed bundling
Is when a business combines two or more products to create a bundle.
Joint bundling
You combine a popular product with less popular ones. The idea is to use the draw of the popular product to to encourage the buying of the less popular products.
Leader bundling
Is when a business provides both bundles and individual products. Often the mixed bundle is offered at a discount compared to the cost of the individual items combined.
Mixed bundling
The 6 benefits of bundling:
- Increase revenue
- Less pressure to decide
- Lower customer costs
- Fewer problems
- Simplicity
- Enhanced customer experience
7 benefits of product sbundling:
- Enhance the customer experience
- Relieve the pressure of decision making
- Improve customer confidence
- Helps customers understand the products better
- Enhannce customer feedback
- Increase revenue and average sales
- Sped up inventory clearance
Represents the incremental cost incurred when producing additional units of a good service.
Formula:
MC=(change in cost)/(change in quantity)
Marginal cost
(9) Types of brand switching:
Availability
Customer experience
Change
Curiosity
Needs
Perceptions
Reputation
Competition
Pricing
Consumers mental arithmetic varies between different frames, but somehow customers associate the bundle saving on the individual items and additional savings on the purchase bundles.
Buyers mental arithmetic of bundles
(2) Weighted additive rule:
Customer prefer discount
Consumer fail to adjust
Discount new and repeat customers because people prefer buying things on sale, discount serve as a ploy to attract more people to your store.
Consumer prefer discount
When a business fail to meet customer expectations, customer do business elsewhere.
Consumer fail to adjust
(6) Types of bundling:
- Pure bundling
- Mixed bundling
- Cross company bundling
- Premium bundling
- New or unpopular bundling
- Tying
When a group of items are bundled together amd cannot be purchased separately not two products can be sold separately.
Pure bundling
When a group of items are available for purchase as bundle and can be sold separately as well.
Mixed bundling
When items from different companies are bundled together into one group.
Cross company bundling
When a group of items are bundled together, and the price often actually higher than the individual price put together.
Premium bundling
When a popular items are bundled together with unpopular or new items.
New or unpopular bundling
