Definition: A bundled product is a package of two or more stand-alone products sold together for a single cost. In most cases these products are complimentary units sold together to increase consumer interest and sales.
The key concept to understand is that each product in a bundle can be broken away from the set and sold on its own. These units are most commonly called stand-alone products because they are fully functioning products by themselves and can be sold separately to the consumer.
What Does Bundled Product Mean?
Thus, products that are sold with multiple components that are dependent on one another are not considered bundled products. For example, a computer monitor sold with a power cable is not considered bundling because both of these units require the other to work properly. A computer monitor sold with a keyboard, on the other hand, is a good example of bundling because it sells two complementary products together that could be sold as fully functional products on their own.
Example
Retailers and manufacturers put bundles together for a variety of reasons. Retailers use this process to increase sales on slow moving products or get rid of older stock. For example, a computer retailer might be trying to sell its older keyboards to make room for the new ones, so it bundles them with the monitors to make them more attractive to customers.
Manufactures often partner with other manufactures to group complementary products before they are sent to retailers. This is a very common practice in the computer industry. Hardware and software companies often bundle their products to make them more attractive to consumers. Can you remember when you purchased a PC without Windows preinstalled? Never. All PC companies have contracts with Microsoft to include Windows in the purchase of a new PC.
