As seasonal trading periods and key sales dates like Black Friday, Cyber Monday, and Prime Day are fast approaching in Q4, it is essential for Amazon sellers to consider how to offer better deals on their products. One of the best ways to create value for both shoppers and retailers is to create product bundles on the marketplace that enable increasing the average revenue generated per sale.

An introduction to Amazon bundling

In addition to providing a more cost-effective solution for buyers, bundles reduce the amount of time spent searching for products to locate the right items.  However, the key to successfully bundling products is to combine items that are frequently purchased together by customers.

Amazon has also recently introduced an invite-only pilot programme in the U.S. that enables sellers to created product bundles virtually. Although the Product Bundles Pilot Programme is still in its testing phase and may be refined further before an official release, it is worthwhile for FBA sellers to consider how the features detailed later in this article can impact your sales and marketing strategies.

Why bundling is important

Bundling is also a great way for sellers to cross-promote product lines, offering more variations to customers without launching entirely new products. Product pricing is a key factor in the decision process of Amazon customers, so including bundles which provide a discount for price-sensitive customers can help capture additional sales that may otherwise be lost.

In-demand seasonal bundles launched around peak shopping periods such as Black Friday, Cyber Monday, and Prime Day can also contribute to an increase in conversion rates and helps sellers to compete by offering unique item variation.

Amazon bundle types

There are currently two methods of bundling products with Amazon. Most merchants are reliant on a process that is similar to launching new products, involving physically packaging related products together, sending the bundles to FBA warehouses, and assigning a unique UPC for each bundle type.

Although it can be a lengthy process to manually set up and manage bundles this way, it does guarantee ownership of the Buy Box in most cases, as other sellers will have to undergo the same process to sell in the same listing. This strategy is particularly effective for retailers and merchants that do not have exclusive distribution rights to a product. It can also be cost-effective, as Amazon only charges a single item fee for bundles which is especially applicable for low-price items.

Virtual Bundles

The new beta programme named the Virtual Product Bundles tool allows brand owners to bundle two to five complementary ASINs in a single product detail page. Amazon will also update bundle quantities based on the availability of the lowest-stocked item within the bundle. This enables sellers to save time by not having to adjust their inventory prior to sending to an Amazon warehouse. The programme is available through an invite-only process for selected sellers that are enrolled in Brand Registry 2.0 and there is no announcement about an official launch date.   

The difference between virtual and traditional bundles

While there are similarities between traditional product bundles and the new Virtual Product Bundles, sellers should be aware of some key differences.

A key aspect to note is that sellers cannot run regular PPC sponsored advertising for virtual bundles and will be limited to using Sponsored Brands. Amazon has also restricted the back-end search terms options, so each bundle created will inherit the search terms from the primary ASIN assigned to the bundle. Instead, sellers will have to add top relevant keywords within the listing’s copy to ensure a higher ranking.

The pricing tool is also slightly restricted, as each bundle must feature the same or lower pricing than if the customer had purchased the products individually. There is also no sales reporting for bundled ASINs, as well as no FBA fees or shipping discounts, meaning the same fees are applied as if the products are shipped separately.

Virtual bundles cannot be a variation of another ASIN within the existing catalogue. This also means that each bundle will require its own customer reviews and ratings separate from its individual components.

Bundling considerations

• Category restrictions

Some categories including books, movies, and video games have restrictions for bundles. One of these items can be included in a bundle but cannot be the primary item in the set. Only one category can be selected, even if the products are listed in multiple categories separately. It is recommended to select the category in which the highest-priced item is sold.

• Product identification

Sellers looking to list product bundles should be aware that Amazon requires each bundle to have its own standard product identifier or manufacturer part number. Individual product identifiers are not accepted as the identifier for the whole bundle and may lead to the immediate removal of the listing. In most instances, sellers are eligible to apply for a GTIN (UPC) Exemption from Amazon.

• Bundles listing content

Amazon also has strict guidelines about the title and product feature bullet points for bundles. However, the essential things to remember are to include the word “bundle” and the number of items included within the package in your listing titles.

Summary

For many sellers, Amazon bundles can be a challenging but rewarding process due to its relatively low-cost investment to launch. The introduction of the Virtual Product Bundles Programme indicates that Amazon will focus on making bundles more prominent and easier to create, so it is worthwhile for most sellers to analyse how their marketplace strategy can be adapted to utilise the new enhancements.

For more information about setting up Amazon bundles, understanding which products to select, and how to meet Amazon requirements, get in touch with us for a free consultation.