Nowadays, D2C brands attempt to do their best & set out many different ways to upsell their products. They test different strategies from time to time. Product bundling is one of them. It is a marketing strategy that is very popular in eCommerce. It allows brands to increase sales and average order value as well as save money on promotion.
In this article, we will learn how product bundling works, its type & example.
What is Product Bundling?
Product bundling as the name suggests is a process of wrapping up certain products or services altogether and selling them as a single unit at a sole price. Product bundling is generally required when the products are complementing one another and can be sold in a package. For instance, one can bundle up shampoo and conditioner together rather than selling them individually.
What are the benefits of Product Bundling?
There are several benefits of product bundling:
Perform marketable :
When we opt for bundling products together, It is a win-win, for both the consumers as well as the retailers. The consumers get a chance to choose and buy multiple products at once also at a discounted price. Their buying experience also gets easier as they don't get confused between buying products individually.
The retailer will too have the advantage of selling their products and collections in bulk. The customer is more likely to spend a good amount as multiple products will cost more than a single product which will increase the average order value (a significant metric for the success and growth of your company).
Save on marketing & distribution costs :
In some cases, different consumers tend to buy the same products individually at all times. You can bundle those products as a single unit and save time for consumers. It will also reduce the time of marketing each product individually as a key component of any bundling strategy is receiving a higher initial return on the cost of acquiring a customer. Thus helping in improving the inventory turnover ratio.
Besides, it saves the cost of postage too as multiple products will be shipped at once.
Reduce inventory waste :
Some of the products end up in deadstock or are about to be discarded as waste can be saved and sold through product bundling. You can bundle deadstock with popular ones or worst sellers with top ones. The consumer will see it as a great deal as they are getting one more product that is also at a reasonable price. This will help in reducing inventory waste.
Types of Product Bundles
There are several different bundling techniques that are used to group products:
- Pure bundles
- New product bundles
- Mix-and-match bundles
- Cross-sell bundles
- Gifting bundles
- Inventory clearance bundles
- Buy-one-get-one bundles
Example of product bundling -
Here is an example of a custom gift box that lies in the category of gifting bundle -
Consumers buy products in bundles because it helps them save money and try new products at low risks since brands usually combine top-selling products with low-selling items. This technique can increase your company’s average order value, sales, and revenue, save money on promoting and distributing individual products, and enhance customer experience.
Hope you found this helpful.