It has been observed that the dynamic of bundling prices is more effective for companies. This confronts an individualization of prices where the budget would be higher, to the strategy of offering discounts if prices are grouped.
With this strategy, which is currently being widely used by companies, the aim is to offer customers comfortable price packages for the use of a service or the purchase of a product. Generating a benefit for consumers, and increasing the level of competitiveness of the company due to the price factor.
Many companies already offer these services in packages: travel agencies are a great example of price grouping, offering all-inclusive trips for a lower price by buying each of the necessary things in different blocks. Educational services also offer grouping of prices if the client takes certain hours of class.
But why this strategy?
Consumers set price dynamics
Through the economic theory of consumer surplus, it is established that depending on the usefulness of the product or service for the consumer, he will be willing to pay one price or another to obtain them. This surplus is created in the difference between the price the customer pays and the price he is willing to pay. Using this dynamic in favor is something that is achieved with the grouping of prices.
What has been observed is that by having an individualization of prices, said surplus is lost. At least two types of clients have been observed: suppose that the client is going to take English classes, and is willing to pay 16 euros for the class and 8 euros for the materials, in total he would pay 24 euros. The second client is interested in the materials to study independently and would pay 25 euros for the materials and only 5 euros for classes, having a final price of 30 euros.
In this way, prices would be set that each client will pay without any surplus since they do not share the same interests in relation to a service.
So what is bundle pricing for?
This strategy mainly allows discovering an intermediate point, and of combination to offer a product or service, exceeding sales levels, by having greater competitiveness in the market.
This is achieved by using in favor the factor surplus that the customer is willing to pay. While each of the above examples varied in the price they wanted to pay, in the grouping of pricing, it must be possible to establish a price that is tentative for both types of clients.
For this reason, being able to make an average between 24 and 30 euros that each client would be willing to pay, is to offer a greater number of clients a service at competitive prices. If the classes and materials to attract both groups were offered at a price of 25 euros, he would have a profit of 50 euros for both clients. Generating a surplus of 4 euros, for which price grouping can be further exploited, finally offering both services for the two groups of clients for 24 euros and obtaining from both clients a payment of 48 euros using at least 2 euros of the margin of consumer surplus.
By offering customers the products in a bundle, you avoid addition errors, or allow the impact on customers to be better received by finding everything they are looking for. For this reason, it is important to implement a Bundle pricing strategy in sales businesses, especially focused, in this case, on the world of ecommerce, retail and product sales where there is the possibility of captivating both types of customer.
Flipflow will help you to know if these strategies are implemented in your competitors or sales channels, and with this you will be able to determine if it is time to take advantage of the plan and start offering the products in the same way or even determine different pricing strategies. to compete with them.
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