Product Bundles – Ultimate Guide

Product bundles are an effective e-commerce strategy that enhances the customer shopping experience and boosts sales by selling multiple items or services as a combined package.

Customers using product bundles have 2.7x higher lifetime value (LTV) as they are introduced to a broader range of products, increasing the likelihood of repeat purchases. Additionally, product bundles significantly increase Average Order Value (AOV) by 20-30%, as customers spend more per transaction when they perceive a better deal.

This guide will explore what product bundles are, their benefits, types, strategies, and more for creating effective product bundles. 

By the end, you’ll have a comprehensive understanding of how to implement and optimize product bundles to achieve your business objectives.

1. What is Product Bundling?

Product bundles are groups of individual products sold as a combined package, often at a discounted price compared to purchasing each item separately. This approach leverages the power of value perception and convenience to drive higher sales and improve customer satisfaction.

Within product bundling, cross-selling and upselling are essential techniques. 

Cross-selling involves suggesting related products that complement the main item, enhancing the overall utility for the customer. For instance, a customer buying a laptop might be offered a laptop bag or a mouse. Upselling, on the other hand, offers upgraded versions or additional features of the same product, such as a higher-capacity hard drive for a laptop or premium accessories.

2.Benefits of implementing Product Bundles

Increased Sales

Product bundling can significantly boost sales by encouraging customers to purchase multiple items together. This strategy often leads to a higher average order value (AOV), as customers perceive they are getting a better deal when buying bundled products instead of individual items.

Enhanced Customer Experience

Bundles enhance the customer experience by providing convenience and added value. By offering a selection of complementary products together, businesses simplify the decision-making process for customers, making their shopping experience more enjoyable and efficient.

Increase in Average Order Value 

By offering complementary products together at a perceived discount, customers are more likely to purchase multiple items in one transaction, thus increasing the total amount spent. 

Competitive Advantage

Offering unique and attractive bundles can give your brand a competitive edge. By creating innovative and appealing product combinations, businesses can differentiate themselves from competitors, making their offerings more attractive to customers.

Cost Efficiency

Product bundling can lead to cost efficiencies in packaging and shipping. By combining multiple items into a single package, businesses can reduce packaging materials and shipping costs, ultimately increasing their profit margins. 

3. Types of Product Bundles 

There are two primary approaches to bundling: pure bundling and cross-sell bundling. Pure bundling involves selling products exclusively as a bundle, while cross-sell bundling offers the flexibility to purchase items individually or as part of a bundle.

Following, we will offer examples and strategies on how to apply them.

1. Pure bundles: Defined as sole products

Products are only available as a bundle and cannot be purchased separately. This method ensures that customers must buy the entire set to get a specific item, driving up the total purchase value. 

HelloFresh is a leading online service that provides consumers with pre-measured ingredients bundled together in one box according to specific recipes for cooking at home.

This is a classic example of pure bundling, where customers cannot purchase the ingredients individually, making it convenient for them to receive everything they need for their chosen meals in a single delivery.

Best Seller Bundling

Introducing a new product alongside bestseller products to boost its exposure and sales. This strategy can help new products gain traction by leveraging the popularity of existing items. 

Sharma Bodega exemplifies this strategy effectively boosting the exposure and sales of the new product by associating it with a successful product, encouraging customers to try something new within a familiar and trusted context.

Seasonal Bundling

Special bundles created for holidays or seasons, such as special gift sets or summer essentials kits. This strategy leverages seasonal demand and enhances the relevance of your offerings.

Pai’s summer bundle, which includes a variety of top-selling products, is an excellent example of how businesses can attract customers during festive seasons by creating unique product combinations.

Inventory clearance bundles 

Bundles designed to clear out excess or slow-moving inventory by combining these items at a discounted rate. This helps in managing stock levels and freeing up storage space while still generating revenue from unsold products.

Vesta Sheets offers a clearance bundle that includes 20 pieces of linen at a discounted price. This approach not only helps in clearing out excess inventory but also provides customers with significant value, encouraging them to purchase the bundle instead of individual items

Buy-one-get-one bundles

Buy-One-Get-One Bundles Promotional bundles where customers receive an additional product for free or at a reduced price when they purchase a specific item. This strategy encourages higher purchase volumes and enhances perceived value, driving more sales and customer satisfaction.

Pizza Papa John´s

A popular example is the Papa John’s pizza deal, where customers can buy one pizza and get another one for free. This type of promotion not only attracts more customers but also increases the average order size, making it a win-win for both the business and the customer.

2. Cross-sell bundle: For more flexibility 

Mixed Bundling

Customers can purchase products either individually or as part of a bundle. This offers flexibility and appeals to a broader range of customer preferences. It allows customers who want only one product to buy it separately, while those looking for a deal can opt for the bundle. 

Wendy’s

Wendy’s “2 for $6” deal is a prime example of mixed bundling. Customers are given a variety of products, of which they can pick the two products of their preference to build their ideal $6 combo. 

Hand-picked Bundles: AI + Human expertise 

These product bundles consists of product suggestions based on the companies’ knowledge of their audience, plus AI suggestions to make personalised recommendations.

Additionally, brands can create “Complete the Look” type lists for their products, offering customers a cohesive shopping experience.

This ability to combine AI-driven recommendations with human expertise to suggests complementary products that go well with items in a customer’s cart, increasing the average order value and customer satisfaction by recommending a full outfit based on a selected item.

If you want to implement hand-picked product bundles in your marketing strategy, you can opt to start working with Frizbit that offers brands the ability to combine AI-driven recommendations with human expertise for improving the customer experience.

Category based bundles 

Category-based bundles involve suggesting additional products within the same category to enhance the main purchase. This strategy ensures customers find all the items they need in one place, creating a seamless shopping experience

Tech industry: Dell’s website often suggests compatible mice when you purchase a keyboard.

Cosmetic industry: Green People Suggest an after-sun for all sunscreen creams 

Attribute based cross-sell bundles 

Attribute-based cross-sell bundles involve recommending complementary products based on specific attributes of the main product, such as compatibility, color, or style. This method leverages the characteristics of the main product to suggest items that will enhance its use or appearance, providing a tailored shopping experience.

Fashion industry: Urban Outfitters bundle accessories based on the colour of selected clothing items. 

4. Eligibility and considerations for using product bundles

When considering product bundles for your online store, several eligibility requirements and considerations need to be addressed:

Eligibility Requirements

Your store must use the Online Store sales channel or a Custom Shopfront, and you need a product bundles app installed. It must also use Checkout Extensibility.

Incompatibility Considerations

Certain features are incompatible with product bundles, including subscriptions, pre-orders, so always try-before-you-buy.

Inventory Management

The inventory of a bundle is determined by the product with the lowest stock level within the bundle, ensuring real-time updates.

Returns Policy

Bundles cannot be marked as final sale. The return eligibility of a bundle is based on the individual items’ return rules within the bundle. Customers can submit return requests for any eligible products in a bundle.

5. How does Product Bundles work?

Product bundle strategy leverages consumer psychology, making the bundled deal appear more attractive and economical.

By presenting a curated set of complementary items, it saves customers time and effort in selecting individual products. This convenience, coupled with the appeal of a discounted price, often leads to increased sales and higher average order values.

Additionally, product bundling leverages cross-selling opportunities, introducing customers to new products they might not have considered otherwise

Furthermore, customizable bundles further enhance the customer experience by allowing personalization, catering to individual preferences and fostering greater satisfaction and loyalty.

6. What is product bundle pricing? 

Product Bundle is an effective pricing strategy takes revenue, profit, consumer behaviour, and business goals into account. Furthermore, it also considers the human psychology to change the customers’ perception of price during their shopping experience. 

To understand this pricing strategy, let’s look at this example of  a sporting goods store

Products: :

• Soccer ball – $20
• Water bottle – $10
• Sports towel – $8
• Gym bag – $15

The store could create a sports essentials bundle with all these products and offer it at a discounted price of $40. 

This bundle is appealing because it provides athletes with all the necessary items for their training sessions. Customers save $13 compared to buying each item separately, and the convenience of purchasing all essentials at once adds to the bundle’s attractiveness.

Moreover, the retailer can move inventory, such as the sports towels, which might not be selling as well individually. 

While the initial discount might reduce profit margins, the increase in sales volume and higher average order values can lead to greater overall revenue in the long run.

7. Product Bundles Placements in eCommerce  

Effective placement of product bundles on your eCommerce site is crucial for maximizing visibility, encouraging purchases, and enhancing the customer experience. 

Here are some strategies for placing product bundles:

Homepage Placement: Featuring bundles prominently on the homepage attracts attention and drives sales. Use hero banners and dedicated sections to showcase bundles.

For example, an electronics retailer can highlight a back-to-school bundle with a laptop, mouse, and backpack.

Product Pages: Placing bundles on individual product pages encourages cross-selling and increases average order value. Display bundles in the “Related Products” or “Frequently Bought Together” section.

For example, a beauty brand could suggest a skincare routine bundle on the page of a popular moisturizer, including a cleanser and serum.

Cart and Checkout Pages: Use upsell pop-ups to suggest adding bundles before checkout and display bundle recommendations alongside the order summary with compelling discounts. 

For example, an online grocery store could suggest a meal prep bundle in the cart, including various ingredients for a recipe.

Category Pages: Feature bundles at the top or within relevant categories and allow customers to filter and sort products to easily find bundles.

For example, a sports equipment retailer could showcase a beginner’s tennis bundle in the tennis equipment category.

Email Marketing Campaigns: Send personalized emails suggesting bundles based on past purchase behavior and promote seasonal or holiday bundles through dedicated email campaigns. 

For example, an apparel store could send an email campaign promoting a winter clothing bundle, including a coat, scarf, and gloves.

8. Examples of Most common Product Bundles

Product bundling can take various forms, each offering distinct benefits for businesses and customers. 

Let’s explore two examples of product bundles: pre-set bundles, hand-picked bundle, adn thematic bundle.

Pre-set Bundle 

La Roche Posay bundled its popular moisturizer with a new face serum and a sunscreen, promoting the new product through the trusted ones, thus increasing visibility and sales.

More benefits of pre-set bundles

• Pre-set bundles offer targeted marketing by tailoring bundles to specific customer segments, like a fitness bundle with a yoga mat, resistance bands, and a water bottle for fitness enthusiasts. 
• They also enable cross-selling by grouping complementary items, such as a laptop with a mouse and carrying case, introducing customers to new products and increasing transaction value. 
• The time-saving convenience of pre-set bundles is highly valued, as they allow customers to quickly find and purchase all they need in one go, enhancing the shopping experience.

Hand-picked Product Bundle

Sephora implements a hand-picked strategy, allowing the customers to choose three to five items from a selection of skincare, makeup, and hair care products. This ensures they get exactly what they want and provides the company with data on popular combinations.

More benefits of hand-picked bundle

• Hand-picked options enhance personalization by letting customers tailor their shopping experience. 
• This approach increases higher engagement, leading to stronger brand loyalty. 
• Additionally, it offers valuable data collection insights, helping businesses refine product offerings and marketing strategies based on popular customer choices.

Thematic Product Bundles

State Bags offers a “Big Kids Travel Bundle” for a special occasion, which combines a suitcase, travel backpack, and a toiletry kit into a single, themed package. This thematic product bundle is designed to cater to families planning trips, providing convenience and a cohesive look for their travel gear.

More benefits of thematic bundles

• Thematic bundles leverage specific customer interests or seasonal trends to create appealing packages. 
• Travel-themed bundle addresses the needs of customers planning vacations, enhancing their shopping experience by offering relevant items together. 
• These bundles can drive higher sales and customer satisfaction by meeting specific needs in a single, convenient package.

9. Strategies for Effective Product Bundling

To maximize the benefits of product bundling, it’s essential to implement effective strategies that resonate with your customers and align with your business goals. 

Here we will give you some key strategies such us: understanding your market, offering complementary products, and employing dynamic pricing.

Quick variant selection + 

Enable customers to quickly choose different variants within a bundle, such as colors or sizes, enhancing their shopping experience and satisfaction

Find Complementary Products + algorithms AI

Choose products that naturally go together to enhance the perceived value of the bundle. Leveraging AI algorithms can further optimize this process by analysing customer purchase patterns and preferences to identify the most complementary products.

Apply Dynamic Pricing

Offer attractive discounts on bundles compared to individual purchases. Ensure that the savings are significant enough to motivate customers to pick the bundle over single items.

Create Urgency with Limited Time Offers

Create urgency with time-limited bundle deals. This strategy can drive quick sales and take advantage of impulse buying behaviour.

Personalisation with AI Algorithms

By analyzing customer behavior, preferences, and purchase history, AI can tailor product bundles to individual customers, ensuring the bundles are relevant and appealing.

9. Tools and Technologies for Product Bundling

Marketing Automation Platforms for eCommerce

Frizbit specializes in hyper-personalized recommendations and automated marketing strategies to enhance your bundling efforts by collecting user data, enriching product information, and using algorithms to optimize product recommendations. 

Inventory Management Systems

Implement inventory management software to ensure accurate tracking and management of bundled products. These systems help maintain optimal stock levels, preventing overstocking or stockouts, and ensure smooth fulfillment processes. Effective inventory management is crucial for handling the complexities of bundling multiple products.

Analytics and Reporting Tools

Use robust analytics and reporting tools to analyze bundle performance and optimize your strategies. Tools like Google Analytics and other e-commerce analytics platforms provide valuable insights into sales data, customer behavior, and bundle effectiveness. This data-driven approach allows businesses to refine their bundling strategies, improve customer satisfaction, and increase revenue. 

Frizbit’s technology also helps evaluate and optimize results, further enhancing your recommendation strategy.

10. How Product Bundles Work with Frizbit? 

Frizbit enhances product bundling by leveraging advanced data collection and hyper-personalisation technologies. 

First, it gathers data on user behaviours and preferences, such as viewed products, favourites, purchases, and abandoned items, using native plugins or Google Tag Manager. 

This information is enriched with detailed product data, including stock levels, prices, images, and categories, which helps define sales rules, preferences, and exclusions.

Frizbit then applies advanced algorithms to each placement type to enable personalised product recommendations. This includes cross-sell bundles that suggest complementary products to items in a customer’s cart, significantly increasing average order value (AOV) and customer satisfaction. 

Frizbit continuously evaluates and optimises these recommendations based on real-time data, ensuring that the bundling strategy remains effective and aligned with business goals. 

By integrating these personalized and automated strategies, Frizbit helps businesses boost sales, enhance customer experience, and streamline inventory management.

10. Future Trends in Product Bundling

1. Personalization and AI: Explore how AI can create personalized bundles based on customer behaviour. Machine learning algorithms can analyse customer data to recommend bundles that are tailored to individual preferences.
2. Augmented Reality and Virtual Reality: Discuss the potential of AR and VR in enhancing the bundling experience. For example, customers could use AR to visualize how bundled products would look in their home before making a purchase.
3. Sustainable and Eco-friendly Bundles: Highlight the trend towards sustainable product bundling and eco-friendly packaging. Customers are increasingly looking for environmentally friendly options, and offering sustainable bundles can enhance your brand’s reputation.

11. Conclusion

Product bundling is a powerful e-commerce strategy that enhances customer loyalty and boosts sales by combining items to create value and convenience. By leveraging tools like Frizbit for personalized recommendations and automated marketing, businesses can optimise their bundling efforts, driving higher average order values and improving customer satisfaction. Implementing these strategies ensures effective inventory management, competitive differentiation, and alignment with customer needs.

12. Product Bundles FAQ

Which is an example of product bundling?

For example, a clothing retailer could bundle three slow moving items, like sandals and sunglasses, with a popular item like a dress, and offer the bundle at a lower price. This could encourage customers to save money and buy the bundle.

What is a bundle of products?

Product bundling is a technique in which several products are grouped together and sold as a single unit for one price. This strategy is used to encourage customers to buy more products.

How to create a bundle product?

• Put Complimentary Products Together. Bundles best work when you combine products that are often purchased together
• Sell Items Separately
• Use Recommendations
• Pair Products Smartly
• Keep Bundles Nice and Simple.

What is the difference between product bundle and package?

The bundle’s price is the aggregate of the prices of all the bundle components. For example, a computer bundle might be composed of a central processing unit, a monitor, a hard drive, and a CD-ROM drive. Unlike bundles, a package is an atomic collection of catalog entries.

What are bundles of goods?

Bundling is when companies package several of their products or services together as a single combined unit, often for a lower price than they would charge customers to buy each item separately.

How to implement a product bundling strategy? 

To implement a product bundling strategy, businesses should analyze customer purchase data to identify which products are frequently bought together, group similar or complementary products set attractive bundle prices, and market these bundles effectively to target audiences.