In plain words
A product bundle sells several units as one purchase, at a price below what they would cost bought one at a time. It can be several of the same product, or different products that go together.
A bundle gives up price and gets back cost. The discount comes off revenue. In return, the order ships once: one label, one base fee, one box. For most small products that saving is larger than the discount, which is why a bundle can be cheaper per unit for the customer and still keep more per order.
Formula
- Bundle price = unit price × units × (1 − bundle discount)
- Bundle margin = bundle price − unit costs × units − one order's fulfilment and fees
Worked example
Three $40.00 bags at 15% off sell for $102.00. The engine puts the order's margin at $48.06, against $15.36 for one bag.
Per visitor, the bundle can convert 68.0% worse than the single bag and still earn as much.
The example order
A $40.00 bag of coffee, shipped free, every cost counted
2 declared kinds cost nothing on this option
| Step | Grain | Amount |
|---|---|---|
| Revenue | – | $40.00 |
| Cost of goods | per unit | −$12.00 |
| Pick and pack | per order | −$1.18 |
| Packaging | per parcel | −$0.50 |
| Shipping label | per parcel | −$7.50 |
| Card fee per order | per order | −$0.30 |
| Refunds | percent | −$2.00 |
| Card processing | percent | −$1.16 |
| Contribution margin | – | $15.36 |
| 2 kinds costing nothing | – | $0.00 |
Computed by the margin engine in Offer Suite's own code, in whole cents, from a $40.00 bag of coffee with a $12.00 unit cost.
A bundle is not a discount with extra steps
A plain discount gives up revenue and saves nothing. A bundle gives up revenue and saves a label and a base fee for every unit after the first. Judge it on margin per order and per visitor. Its discount rate alone says little.
Using it
Set the bundle discount from the fulfilment it saves, then test whether customers take it. Check the parcel: a bundle that outgrows its box or ships in two parcels loses the saving it was built on. And watch who buys it. If the bundle only moves buyers who would have bought twice anyway, it has given a discount for nothing.