5 Ways that Retailers Can Improve Merchandise Planning of Product Bundles and Kits

Product bundling and kit creation are becoming increasingly popular strategies in the retail industry, offering customers convenience, value, and an opportunity to discover new products. Let’s explore some best practices in retail merchandise planning for product bundles and kits, focusing on novel ideas that challenge the conventional wisdom. Additionally, we’ll touch on the role of merchandise planning software in the process and give some examples from the retail industry.

1.Focus on complementary products, not just high-margin items

Traditional retail wisdom suggests that product bundles and kits should include high-margin items to maximize profits. However, this approach may not always lead to the best results. Instead, consider building bundles around complementary products that naturally go together, even if they don’t have the highest profit margins. This strategy can lead to increased customer satisfaction and higher overall sales, as customers perceive more value in a well-curated bundle.

For example, a home improvement store might bundle a power drill with compatible drill bits, safety glasses, and a carrying case, even if these items individually have lower margins. Customers will appreciate the convenience and see value in the complete set, ultimately increasing overall revenue.

2.Create personalized bundles based on customer data

Personalization is becoming a key differentiator in retail, and product bundles are no exception. By analyzing customer data, retailers can create highly targeted bundles that cater to individual preferences and needs. This approach can result in higher conversion rates and improved customer loyalty.

If you’re a beauty retailer, you might analyze purchase history data to offer a personalized skincare bundle that includes cleanser, toner, and moisturizer specifically suited to a customer’s skin type and preferences.

3. Embrace dynamic bundling strategies

Dynamic bundling allows retailers to adjust their product bundles and kits in real-time based on customer behavior, inventory levels, and other factors. This approach can help retailers optimize their offerings and stay ahead of market trends.

Case in point – an online fashion retailer might use real-time customer data to offer a dynamic bundle of a popular dress, paired with complementary accessories that change based on the customer’s browsing history or previous purchases.

4. Consider seasonal and promotional opportunities

Effective merchandise planning for bundles and kits should take into account seasonal trends and promotional opportunities. By aligning bundles with seasonal events, holidays, or sales promotions, retailers can drive customer interest and encourage impulse purchases.

For example, an electronics retailer might create a “Back to School” bundle, including a laptop, printer, and essential software at a discounted price, driving sales during the back-to-school shopping season.

5. Leverage merchandise planning software for data-driven decision-making

Advanced merchandise planning software can help retailers optimize their product bundling strategies by analyzing historical sales data, customer preferences, and market trends. These insights can inform the creation of compelling product bundles and kits that resonate with customers, driving sales and improving inventory management.

Case in point – a retailer might use merchandise planning software to analyze the performance of past product bundles, identifying trends and patterns that inform the development of future offerings.

TLDR

In an increasingly competitive retail landscape, product bundling and kit creation strategies offer an opportunity for retailers to differentiate themselves, provide value to customers, and increase sales. By embracing best practices in merchandise planning, such as focusing on complementary products, personalizing bundles, adopting dynamic strategies, considering seasonal and promotional opportunities, and leveraging merchandise planning software, retailers can create product bundles and kits that stand out from the competition and resonate with customers.