Product bundling is the practice of selling several items together as a single package. Instead of purchasing each item separately, the customer buys them as a combined group, often for a single price.

A classic example is a fast-food value meal. You could buy a burger, fries, and a drink individually. But you can also buy them all together as a combo meal, which usually costs less than the sum of its parts. This is bundling in action.

The goal is simple: offer more value to the customer while increasing the average sale size for the business. It simplifies the buying process and can make customers feel like they're getting a great deal.

Bundling creates a win-win situation for both businesses and their customers.

For the business, the most obvious benefit is an increase in the average order value. Customers who might have only purchased one item are encouraged to buy more. It's also a great way to sell less popular products by pairing them with bestsellers. A slow-moving accessory, for instance, might sell better when bundled with a popular electronic device.

For the customer, the primary benefit is perceived value. They get more products for a lower price than if they bought everything separately. Bundling also simplifies decision-making. Instead of weighing multiple options, a customer can choose a single package that meets all their needs, saving time and mental energy.

Not all bundles are created equal. Businesses use a few common strategies depending on their goals and products.

With pure bundling, the items are exclusively sold in a package. Think of software suites like Microsoft Office. For a long time, you couldn't easily buy just Word or just Excel; you had to purchase the entire suite. This strategy forces customers to acquire all the products in the bundle.

Mixed bundling is more flexible. It gives customers the choice to buy items separately or together. The bundle is almost always offered at a discounted price to incentivize the package deal. Our fast-food value meal is a perfect example. You can buy the burger on its own, but the meal deal is more attractive.