Product Bundles on StackShift and ECWID Ecommerce Platform

Manufacturers across various industries commonly employ product bundling. However, they all face a common challenge of determining the optimal method for creating and managing bundles that effectively boost the average order value.

So let's delve deeper into what product bundles are, what are their benefits, and what product bundling strategy can you implement with the help of StackShift and the ECWID e-commerce platform.

Defining Product Bundles

It's a fact that we enjoy purchasing product bundles, particularly if they're thoughtfully curated. However, crafting product bundles is both an art and a science, as customer response to each bundle can vary significantly for various reasons.

In retail, product bundling is a tactic that involves offering a thoughtfully curated selection of complementary products to attract both browsing and motivated shoppers.

This can be achieved through upselling or cross-selling bundled products.

• Upselling is the practice of convincing a customer to upgrade their purchase, such as promoting a higher-end and more costly version of an electronic gadget that the customer is considering purchasing. To upsell can also mean to encourage customers to purchase multiple product bundles at a discount percentage instead of to purchase separately one item at a time.
• Cross-selling refers to the promotion of complementary products that are associated with other products in the same category. An example is advertising headsets alongside smartphones or custom cases alongside laptops. In the realm of physical retail, this is akin to the idea of cross-merchandising.

A product bundle, for example, can be defined according to your customer loyalty program, marketing and distribution costs, average order value (AOV), the goal to increase sales, or specific bundle price anchoring.

There are numerous ways and reasons to create product bundles and discounted price opportunities for your customers, which guarantees how valuable product bundling truly is. But this is also the crux of the problem - since there are numerous options, it can be a bit difficult to come up with just the right mix and match bundle for your business.

The success of your product bundles can be significantly influenced by factors such as their complexity, synergy, and pricing. Fortunately, there are several effective strategies available to ensure the success of your bundle offers. In fact, we will explore five of the best strategies down below.

But before that...

What are the Benefits of Product Bundles?

Why offer product bundles?

In short, creating product bundles entails combining multiple items into a package with a discounted price.

This approach enables customers to view your products in a new perspective, potentially resulting in increased spending or increased average order value (AOV).

Examples of product bundles may consist of basic packages, holiday sets, subscription boxes, product samples, and promotional giveaways. Including any of these or comparable options related to your business can yield significant benefits.

Benefit 1: Increasing Average Order Value

Average Order Value (AOV) is a metric that monitors the average dollar amount spent by customers each time they place an order via a website or mobile application. To determine your company's AOV, divide the total revenue generated by the number of orders placed.

One of the primary advantages of product bundles is the possibility of achieving a higher average order value. This translates to new and existing customers spending more during each purchase of any bundle deal.

This is due to the fact that customers are incentivized to buy and spend more when presented with bundle discounts. The concept is that purchasing products in bundles will result in cost savings for the customer.

Although this may result in a slight reduction in margins, the increased sales should more than compensate for it. Furthermore, you may save money on transaction costs by reducing the number of orders.

Benefit 2: Simplifying Your Marketing Strategy

By consolidating your products into a single SKU, you can simplify inventory management and monitoring. More importantly, it allows you to market multiple items in one go.

Rather than promoting ten distinct makeup products, for instance, you can offer them as a single beauty product bundle. This approach can help you save money on marketing expenses and combine several campaigns into a single product bundle package.

Benefit 3: Reducing Business Inventory

Using strategic product bundling allows you to sell slower-moving items by pairing them with faster-selling items.

This can free up space in your inventory, reduce carrying costs, and promote underperforming items. In other words, you can create valuable bundles while maintaining an optimum inventory balance.

However, be cautious when you bundle products that are considered in different tiers in terms of pricing and value. Combining inexpensive products with premium ones, for example, is a bit risky. This type of package deal may not always be successful. After all, you have to think about maintaining a reasonable profit even when you lower price points while you mix and match your products. We'll explore this in greater depth later on.

Benefit 4: Minimizing Inventory Wastage

Aside from doing productive inventory clearance, product bundles also help businesses minimize inventory waste.

Merchants generally dislike things called "deadstock items" due to their associated inventory costs.

Utilizing product bundling is an effective technique for clearing out deadstock items before they become problematic. For instance, you can bundle slow-selling products with top sellers to reduce inventory waste, free up storage space, and decrease inventory costs.

You can also create bundle pricing systems that combine frequently bought items individually into mixed bundles containing stagnant inventory or slow-sell products, offer a free gift, or custom bundles with a discount percentage on shipping costs. All of these will definitely boost sales and create momentum for your business.

Benefit 5: Improving Customer Experience

Product bundling streamlines the decision-making process for customers by offering products or services grouped according to their needs.

This saves time by eliminating the need to search through a large catalog of product pages. Allowing customers to customize their own product bundles by adding, removing, or editing products.

With the ability to create bundles tailored to their needs, enjoy a reduced price while they mix and match bundles, and find quantity discounts among the same product offers - customers will undoubtedly experience higher shopping satisfaction.

Benefit 6: Lowering Business Marketing and Distribution Costs

By using product bundling, you can increase your sales while reducing marketing and distribution costs.

Rather than promoting each item individually, you can group similar products together and market them as a single package. Or bundle frequently bought items with the infrequently bought ones. Alternatively, you can offer bundling products that are easier to ship together and then offer volume discounts to further attract customers.

By doing so, your marketing strategy becomes more effective. Additionally, bundled products require less packaging, resulting in reduced shipping costs. You can even go ahead and offer a bundle type that leverages a monthly payment plan or have mixed bundling products based on specific marketing channels.

Just from this, you'll have more marketing strategy options available, and the possibilities to upsell or cross-sell are endless.

Product bundling offers advantages for both sellers and buyers and now is a good time to start doing it for your business.

How to Sell Product Bundles with StackShift and Ecwid

The StackShift platform integrated with the Ecwid e-commerce platform, allows you to create product bundles that have the equivalent functionality of product bundles created with much more sophisticated platforms like Bigcommerce and Shopify, to name a couple.

A product bundle is a collection of multiple goods or services that are sold as a single product. The items in the bundle are typically grouped together based on their similarity or compatibility, such as a gift basket of skin-care products that includes a cleanser, toner, and moisturizer.

You can basically create any combo or bundled product that you can imagine, with lots of variants and prices.

You can further promote the bundled packages with discounts and relevant coupons.

The real innovation that StackShift brings to Ecwid e-commerce stores is the automatic integration with ECWID of the bundled products for:

• Inventory updates
• Shipping information to either your warehouse or third-party shipper
• Any other part of your business that needs access to the underlying data of the bundled product

All the functionality described above is done through discrete ECWID API implementations, and not through plug-in exercises that are often unreliable, not well maintained, and can break your e-commerce store.

Offering a discount for a set of combined items can boost the average order value. Depending on your business objectives, you will have all the options below through StackShift:

All the functionality described above is done through discrete ECWID API implementations, and not through plug-in exercises that are often unreliable, not well maintained, and can break your e-commerce store.

Offering a discount for a set of combined items can boost the average order value. Depending on your business objectives, you will have all the options below through StackShift:

• Bundle different or multiple products into a pre-selected kit
• Create variations of each set with pre-selected items
• Offer a product box where customers can choose their own bundles
• Offer bundle discount options, may that be a pure bundles discount or discounted shipping fee
• Offer free items with each order or cross-sell those not-so-frequently bought items
• Adjust the total price of those items sold individually and those bundle products with ease
• Promote bundles across various product pages on your website
• Combine all the features above to maximize revenue - applicable for websites of brick-and-mortar stores and pure online retailers.

Overall, product bundling has the potential to boost profits and sales of individual items in the long run. By combining your products into a bundle, you can encourage customers to purchase more than one item in a single transaction.

With StackShift and ECWID integration, creating and promoting product bundles on your website won't require heavy lifting.

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Product Bundles Marketing Strategy

Now we know what product bundling is and how beneficial it can be to any website or business. You also have StackShift to make the whole process of creating product bundles easy. So, now, how can you go about implementing this marketing strategy to produce the best results?

Start with Identifying the Common Types of Product Bundles

Product bundling is not just limited to the holiday season, as it can be an effective sales tactic year-round.

There are typically three categories of product bundles.

Pure Bundling

Pure bundling is a bundling strategy that involves items that are exclusively sold together as a set. An example is the Dyson Airwrap, which comes with detachable blow-dry heads that are only available with the purchase of the set.

Pure product bundling is when products are only available for purchase as a bundle and not as individual products. Some products are exclusively available only as part of a bundle. This approach restricts the options presented to the customer.

There are three subcategories of pure bundling: joint bundling, leader bundling, and mixed-leader bundling.

1. Joint bundling refers to selling two products together at a bundled price.
2. Leader bundling is offering a discount on a non-leader product when purchased with a leader product or accessory.
3. Mixed-leader bundling is a type of leader bundling that allows customers to purchase the leader product on its own.

Mixed Bundling

This bundling method involves combining products that are sold separately at a discounted price.

A prime example is the Kylie Cosmetics lip kits, which include lipstick and lip liner that can be purchased separately but are bundled together for convenience and as complementary products.

Mixed bundling, also known as custom bundling, allows customers to choose between purchasing a bundle or separate products individually.

For example, cable, internet, and telephone providers offer complete packages with varying levels of service, where the price depends on the selected package.

While each service can be bought separately, choosing a package is often more cost-effective, similar to the concept of combo meals in restaurants.

Price Bundling

Bundle pricing or price bundling can be achieved through discounts or value additions, and in some cases, retailers curate specific items that must be purchased together to qualify for the discount.

BOGO or buy-one-get-one offers are common examples of price bundles. This technique can make customers feel like they're getting a good deal, even if they end up spending more than they intended.

image courtesy of Neuroscience Marketing

Interestingly, even if a curated bundle doesn't offer any cost savings, it can still appear to be a bargain for the consumer.

Well-Known Examples of Product Bundling

Here are some product bundling examples that can provide inspiration for your business.

The bundling method you choose will depend on your objectives and the products you offer. The possibilities for product bundling are endless, limited only by the retailer's imagination.

Gift Bundles

During the holidays, one way to meet customer needs is to offer pre-packaged gift bundles, which make it easy for shoppers to purchase a ready-made gift.

Lush, a clean beauty brand, uses this approach effectively. Its website features a gift section with various product bundles at different price points, and its physical stores display the products together.

Additionally, Lush's knowledgeable staff can provide recommendations to shoppers, allowing them to quickly find what they need.

Subscription Boxes

Product bundling has become an increasingly popular strategy among retailers, and subscription boxes are a prime example of this. Subscription boxes are product bundles in their own right, offering customers a collection of complementary items delivered on a regular basis. And it's not just eCommerce retailers that are getting in on the action. Brick-and-mortar retailers are also jumping on the subscription box bandwagon as a way to offer value and retain loyal customers.

Subscription bundling offers a unique opportunity for retailers to build trust and boost customer loyalty. By delivering value and offering a personalized experience, retailers can keep customers engaged in more than one product and help fight subscription fatigue. For example, Apple bundles multiple products such as music, TV, and magazines into their bundle, providing subscribers with a comprehensive entertainment experience. Similarly, subscription boxes offer a wide variety of items that can be tailored to customers' preferences, leading to higher customer satisfaction and loyalty.

Not only do subscription bundles offer value to customers, but they can also benefit retailers in several ways. For instance, subscription bundles can help boost eCommerce revenue over time, thanks to the promise of consistent revenue and the opportunity to lower operating and shipping costs.

Customers are also more likely to opt for subscription bundles due to the convenience of doorstep delivery, discounts, and the flexibility of choosing their box contents. By offering subscription bundles, retailers can create a win-win situation for both themselves and their customers, leading to increased customer retention, revenue growth, and enhanced customer experiences.

Build-Your-Own Bundles | Custom Bundles | Manual Bundles

Retailers have tried a mix-and-match bundling approach, allowing customers to curate their own set of products. While this may appear to contradict the concept of product bundling as a way to create awareness of specific products, it is still possible to encourage product exploration by limiting the options to the items that retailers want to promote.

A case in point is HVMN, a nutrition and supplement company, which discovered that by providing "mix and match" bundles where customers could choose their desired flavors of MCT oil powder or Keto Collagen+, the average order value increased to $108. The company effectively allowed customers to customize their bundles while at the same time, they increase sales of the targeted products.

The mix-and-match bundling technique empowered shoppers to select the items that they were most interested in, thus leading to a more satisfying shopping experience.

By giving customers the freedom to choose their own bundle of products, retailers can increase customer satisfaction and boost sales. While it may seem that providing too many choices could be overwhelming, limiting options to the products that retailers want to promote can have the opposite effect.

Customers are more likely to explore and try new products when they feel in control of the purchasing process. This approach can lead to a deeper level of engagement with customers, which can be highly beneficial to retailers in the long term.

Inventory Clearance Bundling

Combining slow-moving inventory with popular products can be an effective strategy for pushing stagnant items. When you bundle less popular products with more in-demand ones, you create a new product offering that can help revitalize your overstocked or underperforming inventory.

Consider a clothing retailer, for instance, who has a few slow-moving items like sandals and sunglasses that are not selling as well as anticipated. By bundling these products with a popular item like a dress and offering them at a discounted price, the retailer can incentivize customers to purchase the bundle and help move the slow-moving inventory.

Not only does bundling help move stagnant inventory, but it can also create new opportunities for cross-selling and upselling. By pairing complementary products, retailers can encourage customers to purchase additional items they may not have considered otherwise, increasing the overall value of the sale.

Creating Your Product Bundling Strategy

Although creating a product bundle can vary significantly depending on the bundle itself, there are several essential principles that one should adhere to.

Identifying which products or services to bundle

Product bundling is a flexible strategy that can be adapted to suit a range of goals. The bundle type you choose will determine the products you select to achieve your objectives.

The buy-more-save-more bundle can be applied across your store or to specific product lines to drive sales of stagnant inventory. The items for this bundle are typically selected based on your slowest-moving inventory category.

Quantity discount bundles, on the other hand, are designed to promote multiple purchases of the same product. Here, you can choose to promote replenishable items based on bestsellers to increase the average order value. Additionally, you can experiment with using quantity discounts to move stagnant replenishables.

Leveraging data is an effective way to create pre-packaged kits that are most suitable for complementary or related products. By analyzing purchase patterns, you can identify which items are commonly bought together, such as socks with shoes. This information provides an opportunity to sell a bundle that appeals to your customers.

While bundling is a useful sales strategy, it's important not to overwhelm your customers. It's best to pick one or two approaches that align with your goals and implement them effectively. Overdoing it with bundling may cause customers to become confused or frustrated, resulting in lost sales.

Calculating Bundle Price

Calculating the pricing of a bundle can be simple if no discounts are involved.

First, determine the gross margin of each product in the bundle by subtracting the cost of goods sold (COGS) from the total selling price.

This will give you the gross margin dollars of a product.

After establishing your cost baseline, you can decide on a discount that aligns with your brand.

If you choose to offer a discount, consider the following guidelines: for brands with average margins of 50% or higher, discounts of 10% to 20% off the subtotal are recommended, while businesses with average margins of 50% or less should opt for discounts between 5% to 10%.

It's also advisable to test the discount rate over time to determine the best performance.

Naming Product Bundles

Naming your bundle is essential as it affects how you market your new offering.

An effective naming convention is to give your bundle a name that highlights the benefit it provides to the customer. This makes it easier to capture the attention of potential buyers and communicate the value of the bundle in a concise manner.

Some More Tips on Creating a Product Bundle and Marketing It

When selecting products to bundle, it's important to choose items that complement each other. To do this effectively, consider the following strategic factors:

• Include helpful items that a buyer may need while shopping, such as accessories. For instance, if a clock is sold without a battery, consider bundling it to save the buyer from searching for it separately.
• Ensure that your product bundles offer real value by guaranteeing cost savings for customers.
• Analyze sales trends to identify which products are frequently bought together by customers, and leverage this information to inform your bundling strategy.
• Research your competitors' product offerings to identify potential gaps in the market and inform your own bundling decisions.

Aside from that, leverage data and analyze product performance to sell smarter.

The full power of data can be harnessed by using artificial intelligence (AI) and machine learning (ML) tools, which can boost conversions. With the growth of innovative eCommerce development, the positive impact of AI and ML tools on e-commerce sales will continue to be seen.

Leading players such as Amazon and AliExpress are paving the way in utilizing AI and ML to gather data from every customer interaction. This data is used to create bundles and increase sales on all product pages.

Knowing what your customers are already purchasing is another key to creating effective product bundle offers.

Offering substantial discounts or a unique product bundle can encourage customers to make additional purchases they may not have otherwise considered.

For instance, someone looking for a gift for a Kylie Cosmetics fan may be more inclined to purchase a lip kit bundle that includes both lipstick and lipliner in a single package.

This illustrates the power of product bundling, where customers spend more on complementary items, and merchants increase their revenue.

Conclusion

Product bundling is an effective strategy that businesses can use to drive sales, increase average order value, and move stagnant inventory.

By offering customers a product bundle of complementary products at a discounted price, businesses can tap into the psychology of consumer behavior and incentivize shoppers to make additional purchases.

Furthermore, product bundling provides businesses with an opportunity to differentiate themselves from competitors and increase brand awareness. By leveraging data and analyzing sales trends, businesses can create product bundles that cater to their target audience's preferences and offer a unique value proposition.

In today's highly competitive e-commerce landscape, product bundling has become a crucial aspect of a successful business strategy, and companies that fail to implement it risk losing out on potential sales and revenue.

Get a free access to StackShift now and check out how this CMS and landing page builder can help you manage your website better and supercharge your marketing and product bundling efforts.