One of the most common e-commerce strategies includes selling packaged products, from groceries to consumer goods and software is bundle pricing. It allows you to create a better deal for your customer when adjusting pricing based on structural, shipping, and logistics costs. Also, it is a very effective way to sell more specific products without the need to adjust pricing for a single item.

What is bundle pricing about? Simply, based on your defined bundle strategy, you analyse your packages and optimize them by deciding which products to combine and how much to charge for them.

Complex pricing strategies or cost-sharing between products in the same package are highly valued and popular among numerous e-commerce companies and markets. What is worth highlighting is bundle tactics are not used only by online stores that manage their own inventory. Giant players like Amazon use them to increase average transaction size for customers. As you see, bundle pricing is a remarkably effective strategy for selling goods not only for e-stores but for marketplaces too.

In fact, for many retailers, a group price strategy plays a significant role in effective cross-selling similar product lines – though there may be some differences between stricter cross-selling techniques where each combination has been predefined in advance.

Benefits of bundle pricing

If you are still wondering what the advantages bundle pricing can give you, consider what follows:

  • shipping costs and logistics optimization for the whole ordering process
  • more attractive and competitive prices on the market
  • boosting sales of specific products compering to selling them separately

Customers recognize the utility of buying packaging as beneficial both online and in physical stores. They always appreciate financial savings, so even when they do not need multiple products, they are more likely to choose this option perceiving it as a great deal. It can also be attractive for online shoppers to find different options within one place so they can buy products separately or combined, depending on what they need at any given moment. However, some customers can be frustrated by being forced to buy the entire set of products instead of the one they prefer. It is the only downside to consider in the strategy. 

Therefore, it is better to offer various options for individual or combined purchases of your products.

It is also important that you are clear about the savings offered by purchasing a bundle compared with buying each item separately. It is good to highlight the percentage of total savings in your offer.

Setting strategy in 5 steps

In order to successfully develop a bundle pricing strategy, make sure to take all elements into account that let you precisely formulate your pricing tactic – you must know everything necessary before this happens! 

Here is the list of steps to follow that will help you define bundle pricing strategy goals:

  1. Learn about your audience – reviewing what kind of items customers usually buy together is essential to understand and help them find certain products in your catalogs that meet their needs and interests. You want feedback from customers about which products they usually purchase at the same time. Finding out their shopping behaviors will help determine what package deals in e-commerce you should provide or even just one individual product that could lead to purchasing many others.
  2. Competitors’ catalogues – it is helpful to browse and analyse them thoroughly, especially specifics of packages if offered.
  3. Price monitoring – stay informed by knowing what prices competitors have adjusted. Using a competitor price monitoring tool will allow you to determine when and how their prices have changed over time. Price intelligence also will give you valuable insights into how to be more competitive in your pricing strategy.
  4. Stock monitoring – make sure, by accurate measurements, that your inventory level is sufficient to not miss out on selling products as part of bundles, especially if you sell them individually.
  5. Margin and profit – it is best to know upfront what your production and generation costs are, as well as your desired rate of return.

Selling options

Once you have proceeded with all these steps, you need to decide which products will be included in your bundle pricing strategy and how. Based on this, you can choose between three selling options depending on the product type and target audience:  

Mixed bundling: items can be purchased as a package or individually. To not lose those customers who do not want to pay for goods they may not need, you should always select this option, despite the announcement about the benefits of the package. For instance, you can use this option for accessories, replacement parts, or spare parts.

Clean packaging: some products only make sense when sold as a bundle due to their characteristics, market reasons, or because costs incurred for your business may seem too high on their own. For instance, additional mini bottles of perfume will always be attractive to a client who loves extra perks, as well as for your business – you would not make the same profit by selling it individually at the bottom price.

Cross-sell and up-sell discounts: the last option is to offer specific discounts when purchasing multiple items, special discounts on related products, or even enhanced versions of products at a slightly higher price. 

Finally, when everything is ready as it should be, the marketing team must analyse and adopt a bundle pricing strategy itself. Marketing has various possibilities of distribution and even adaptation according to distribution channels. Initiating unique promotions using Amazon Ads, for instance, and additional marketing activities can significantly increase your bundle pricing effectiveness and sales, giving you an expected success in the e-commerce business.

We wish you this as well!