50: Get the bundle!
Do you like package deals? Should you buy them? What about selling them?
A McDonalds Happy Meal is the perfect bundle and if you have a hungry little kid, it can save your life. Nuggets, fries, a drink and now with apple slices so it’s healthy. All in a colorful box with a smiley face. Winner winner chicken dinner.
Bundles are a complimentary set of goods from a single company sold together for less than they would cost individually.
Caveat Emptor1 for sure - tease apart the bundle. Do I really need the fries? If you find yourself standing in a McDonalds, it’s too late to question the fries.
Bundles can be the rare win win for everyone. The company sells more stuff, the buyer gets a better value. Usually.
Whether you know it or not you are surrounded by bundles - they are a proven business strategy. Here’s an interesting example from an unexpected place: the venerable New York Times.
The NYT’s, long a traditional media company, is making the transition to digital in fine form and bundling is at the center of their strategy. To execute this strategy, the NYT’s has carefully split off and cultivated a set of products built on some of the most popular online content categories:
NYTs Cooking - live to eat; recipes are content that will never get old.
Wirecutter - where do you turn when you are making a purchase decision? The internet duh! You must become learn-ed by reading many wise and credible reviews.
Now with Sports! This is a new acquisition - The Athletic. NYTs is not shy about sharing how it’s a key component of their digital bundle.
Can’t forget Games. Anchored by the venerable crossword puzzle, now with Wordle and an ever growing set of online games. NYT’s customers now spend more time online gaming than reading (!) :
You can get all this goodness in their digital bundle. Feels better than just paying for a newspaper right?2 Capture and upsell the gamers, the buyers, the sports fans, the foodies.
Tech loves a bundle. Apple is executing a strategy similar to the NYTs for their growing suite of digital subscriptions. If you have an iPhone I bet you’re already paying for iCloud storage. Why not spend a few more bucks a month and get Apple News, TV, Music, Fitness and more.
It’s a great pitch - Apple wants you to use all their stuff but here’s where you might say no, this is not for me. I’m happy with my streaming from Netflix, my music from Spotify, my news from the New York Times. Best of breed isn’t the bundling way and bundles only work if the additional services in aggregate are useful to you.3
Microsoft Office is arguably the most successful software bundle of all time, but bundling can be seen as stifling competition and it can get you into trouble. Bundling the web browser Internet Explorer in Windows led to a morass of antitrust lawsuits that took a big hit on the company.
Microsoft Teams competitor Slack4 filed a anti-trust lawsuit with the EU for bundling Teams into Microsoft Office. Microsoft pulled Teams out of office in response, but the lawsuit is still pending.
When online services mature and become commodity, it’s common to see consolidation and white labeling. If you’re willing to endure some switching costs, consolidating can help your business save some dough and simplify your business workflows.
In my space - building out websites for businesses - buying the bundle is a good play right now. Every business needs a standard set of services:
Domain Name. Traditional registrars - GoDaddy, NameCheap
Website. Traditional site builders/hosters - Wix, Squarespace, Weebly
Email - This has evolved from traditional email (POP/IMAP) to online services from Google (Gmail) and Microsoft (Office 365)
Digital marketing - email services to connect with your customers. Traditionally Mailchimp, Constant Contact
I recently helped a local artist paying for separate services on all four of these consolidate them with a bundle optimized for fine artists. Now it’s all accessible from a single portal and it’s three fewer monthly payments.
I moved hosting for my website wirepine.com5 and many of my customer’s sites from Wix to SiteGround where they bundle all of these services. Email is IMAP, the newsletter platform is basic, but for most of my customers it’s just what they need. It’s worth checking out.
What about on the sell side - should you offer bundles to your customers? Absolutely! One of my customers core products is a weekly bundle of yummy food. It’s an adult happy meal that’s actually healthy. Of course you can get al-a-carte - grab it in the store - but the bundle is their core product and you buy it online.
Is there a bundle that would help your business?
best, Andrew
Latin phrase ‘Let the buyer beware’
Disclaimer: nope I do not get this but rather I piggy back on David’s student subscription for $1/month. We buy NYT Cooking and we sure play the games so yeah that digital bundle is looking good once he graduates.
This is my story with the Apple bundle. I prefer best of breed without any lockin at least for now
Slack filed the lawsuit in 2020, Salesforce bought slack in 2021. The wheels of antitrust turn slowly.
Sneak peak - turned the lights on the new site this week!
Last week’s article was about how to make goals work for you
