Enablers, Outcomes, and Effects of Product Bundling: Towards an Analytical Model

Product bundling consists of “the practice of package selling”. This practice, mostly studied by economists and marketing scholars, has significant implications for monopoly power, level of welfare and marketing strategies. In recent years, product bundling has gained in importance because, especially in the capital product industries, firms are moving towards the provision of integrated solutions that consist of services and products sold in a bundle and delivered as a unique solution. The objective of this paper is to shed further light on the implications for firm strategy of the practice of product bundling; this paper intends to build a theoretical framework that can be used to analyse firm behaviour in offering product bundling. The chief contributions of this paper are: (1) a critical examination of extant economic and marketing literature on product bundling, (2) the integration of insights gained from this literature into a comprehensive framework and single out implications for scholars and practitioners, (3) drawing some indications for further research.