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Research Outline
Prepared for Wes J. | Delivered August 27, 2019
Digital Services Bundled Offerings Best Practices
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Goals
To understand bundled price/offer best practices and how it affects consumers purchase intent in order to evaluate strategy recommendation in a client report.
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Early Findings
A study by Kumar and
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on the effect of bundling on the portable video game market revealed that "
bundling did lead to
the cannibalization of over half a million consoles—that is, the introduction of bundles led to a loss in sales of about 500,000 plain consoles. But the overall effect was an increase in hardware sales and revenue."
Also, the study revealed that "
bundling also had the unanticipated
effect of goading some consumers into making a purchase earlier than they otherwise would have."
Although price bundling has been shown to improve sales speed and volume, recent research has also shown that "
the purchase quantity requirement
in traditional bundling deters non-buyers from becoming buyers."
Itemizing the price of the items in the bundle can
help improve sales
, especially when the bundle is large. According to researchers, "
large, but not small, bundles
are evaluated more positive when presented with itemized prices."
The researchers' findings show that "
itemizing prices results
in more realistic price expectations and that this effect is stronger for larger bundles. In turn, more realistic price expectations lead to higher evaluation. "
Researchers have also found that "
social bundling outperforms
traditional bundling in driving intention to purchase in bundles. "
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