Bundling - Pure and Mixed

Published 01 Nov 2004
Reference 5234
Topic Marketing
Summary

Product bundling is a marketing strategy that involves offering two or more products for sale as one combined product. This strategy is common in a number of industries including software and traveling. Bundles are typically sold at a big discount compared to the sum of the prices of individual items.

Teaching objectives

This exercise is designed to understand the reasons how pure and mixed bundling can lead to higher profits, even when cost savings or market power are not relevant factors. This insight is important to understand when bundling is an appropriate strategy.

Keywords
  • AR0405
  • AR2004
  • RD1104
  • BUNDLING
  • PRICING STRATEGY
  • CHRISTEN