Cross Selling & Bundling
Applied to everything from fast food to cable TV, bundling offers businesses a tried-and-true way to cross-sell—that is, to sell more things to the same customer. In exchange for a lower price, buyers purchase all the items in the bundle—the burger, fries, and drink, for example—rather than buying each one separately.
Bundling is a particularly good tool in dynamic markets like technology, media, and telecommunications (TMT), which feature a constant innovation cycle and converging market segments. In such an environment, companies are always looking to leverage their strength in one segment to grow in another—computing into consumer electronics or enterprise software into cloud services, for example. They often use bundling as a strategic weapon to combine a product that has a large market share with one in need of greater penetration. Additionally, companies that are already present in a market but haven’t yet been successful may want to emphasize the complementary nature of their products by creating a “better together” value proposition.
- generate incremental profits
- Bundle meets requirements.
- Ensure that the value of the attach product is high enough compared with the core product.
- Stick with higher-margin attach products
- Focus on attach products with low penetration but high potential
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