Bundling is an important strategy in the world of fulfillment and ecommerce. It’s a way to package and sell products that can benefit both businesses and customers. Let’s explore what bundling is, how it works, and why it’s useful.
What is bundling in ecommerce fulfillment?
Bundling in fulfillment means putting two or more products together and selling them as one unit. Instead of selling items separately, a company groups them into a single package. This package is then sold as one product, often with its own special code (called a SKU) for tracking.
For example, imagine a store that sells shampoo and conditioner. Instead of selling these items separately, they might create a bundle that includes both products in one package. This bundle becomes a new product that customers can buy.
How does bundling work?
When a company decides to use bundling, they follow these steps:
- Choose products. the company selects items that work well together or that customers often buy at the same time.
- Create a new package. they put these items together in one package or box.
- Set a price. the bundle usually costs less than buying all the items separately.
- Give it a new code. the bundle gets its own product code for inventory and sales tracking.
- Offer it to customers. the company then sells this new bundle alongside their other products.
What are the different types of bundles?
There are different ways to create bundles.
Pure bundles
In this type, you can only buy the items together. You can’t buy them separately. For example, a meal deal at a fast-food restaurant where you get a burger, fries, and a drink for one price.
Mixed bundles
Here, you can buy the items in the bundle separately if you want. But buying them together in the bundle is usually cheaper. For instance, a skincare set where you can buy the face wash, toner, and moisturizer together or separately.
New product bundles
Sometimes, companies create a completely new product by bundling items. For example, a gift basket with different types of cheese and crackers.
Customizable bundles
These allow customers to choose which items they want in their bundle. Some subscription boxes work this way, letting you pick the products you want each month.
Why do companies use bundling?
Bundling is popular for several reasons:
Sell more products
By grouping items together, companies can often sell more. Customers might buy a bundle even if they only wanted one of the items, because it seems like a good deal.
Clear inventory
Bundling can help sell products that aren’t moving quickly on their own. By pairing a slow-selling item with a popular one, companies can clear out inventory.
Simplify choices
For customers, bundles can make shopping easier. Instead of choosing many individual items, they can pick one bundle that has everything they need.
Increase value
Bundles often provide better value for customers. They get multiple products for a lower price than if they bought each item separately.
Stand out from competitors
Unique bundles can help a company be different from other stores selling similar products.
What are the benefits of bundling?
Bundling has advantages for both businesses and customers:
For businesses
- Higher sales. customers often spend more on bundles.
- Efficient inventory management. bundles can help manage stock better.
- Customer loyalty. good bundles can make customers come back.
- Lower shipping costs. sending one bundle is often cheaper than shipping multiple items separately.
For customers
- Better prices. bundles usually cost less than buying items separately.
- Convenience. getting multiple items in one purchase is easier.
- Try new products. bundles let customers try items they might not buy on their own.
- Gift-giving. bundles make great gifts because they offer multiple items.
What is the difference between bundling and kitting?
People sometimes confuse bundling with kitting, but they’re a bit different:
Bundling is putting finished products together to sell as one unit. Each item in the bundle could be sold separately.
Kitting involves putting together parts or components to create a new product. The individual parts usually can’t be sold on their own.
For example, bundling would be selling a camera with a memory card and case. Kitting would be assembling the camera itself from its parts.
6 examples of bundling in different industries
Bundling strategies are employed across various sectors to enhance customer value and boost sales. Here are some notable examples from different industries.
Technology
Microsoft 365
Microsoft offers a pure bundle of productivity applications including Word, Excel, PowerPoint, Outlook, OneNote, and OneDrive. This comprehensive suite provides integrated tools for businesses and individuals, streamlining work processes and collaboration.
Samsung
Instead of bundling physical products, Samsung offers Samsung Care+ as a bundle with device purchases. This premium support and coverage option protects devices against physical or liquid damage, adding value to the customer’s purchase.
Food and beverage
McDonald’s Happy Meal
One of the most iconic product bundling examples, the Happy Meal combines a main dish, side, drink, and toy. This bundle appeals to children and parents alike, offering convenience and value.
Death Wish Coffee
This coffee company creates holiday bundles, combining their coffee products with branded merchandise. This strategy helps clear inventory and provides customers with themed gift options.
Beauty and cosmetics
Sephora
Sephora’s Play! beauty boxes offer a monthly subscription bundle of six beauty items for $10. This approach increases subscriber numbers and introduces customers to new products.
Lush
Lush creates gift sets that bundle complementary bath and body products. These pre-packaged sets offer convenience for gift-givers and introduce customers to multiple products at once.
Fashion and apparel
Nordstrom
Nordstrom offers carefully curated outfit bundles for different seasons, occasions, and preferences. This strategy inspires customers to purchase complete looks rather than individual items.
New Balance
When browsing for a single product, New Balance recommends bundled looks that include complementary sportswear or accessories, encouraging customers to buy more items.
Electronics
Best Buy
Best Buy offers expert-recommended bundles that allow customers to purchase multiple complementary electronics items at a single price. Customers can add all recommended products to their cart or deselect items as needed.
Travel and hospitality
Travel agencies often create vacation packages that bundle flights, hotel stays, and activities. This comprehensive approach simplifies trip planning for customers and can offer better value than booking components separately.
Summary
Bundling in fulfillment is the practice of grouping multiple products together and selling them as a single package, often at a discounted price, to simplify inventory management and increase sales.