Product Bundling (Case Study)

Topics: Supply and demand, Marketing, Elasticity Pages: 5 (1421 words) Published: December 12, 2012

The group is presenting on the topic of product development and product bundling are significant factors influencing market demand in telecommunication.

Product development involved modification of an existing product or its presentation, or formulation of an entirely new product that satisfies a newly defined customer wants or market niche.There are two parallel paths involved in the product development process, one involves the idea generation, product design and detail engineering; the other involves market research and marketing analysis. Companies typically see new product development as the first stage in generating and commercializing new product within the overall strategic process of product life cycle management used to maintain or grow their market share.

Product bundling is a marketing strategy that involves offering several products for sale as one combined product. This strategy is very common in the software business (for example: bundle a word processor, a spreadsheet, and a database into a single office suite), in the cable television industry (for example, basic cable in the United States generally offers many channels at one price), and in the fast food industry in which multiple items are combined into a complete meal. A bundle of products is sometimes referred to as a package deal or a compilation or an anthology.

Product bundling is most suitable for high volume and high margin (i.e., low marginal cost) products. Research by Yannis Bakos and Erik Brynjolfsson found that bundling was particularly effective for digital "information goods" with close to zero marginal cost, and could enable a bundler with an inferior collection of products to drive even superior quality goods out of the market place. As an example of product bundling is that McDonald’s value meal, phone-internet-cable combos, and all-inclusive vacation packages. In the business-to-business environment, contracts often contain solutions-oriented bundles, example a combination of products and services that are customized to solve specific customer problems. The emergence of new technologies such as cloud computing and fixed mobile convergence continues to transform Malaysia's telecommunication industry. This has increasingly required service providers to differentiate their products and services in order to stay ahead of competition.

The presentation is about product development and product bundling are factors influencing the right shift of the curve demand in telecommunication. It focuses on what is product bundling really are and how Telecommunication Company in Malaysia achieved the product bundling and cater to demand of Malaysian. Several qualities influence the product bundling. According to a 1997 study by Mercer Management Consulting, Lexington, Massachusetts, good bundles have five qualities: 1. The package is worth more than the sum of its parts;

2. The bundle brings order and simplicity to a set of confusing or tedious choices; 3. The bundle solves a problem for the consumer;
4. The bundle is focused and lean in an effort to avoid carrying options the consumer has no use. 5. The bundle generates interest or even controversy
Telecommunication in Malaysia, they focus on system that more products produce more profit. The presentation focuses on smartphones as what companies in Malaysia are doing the product bundling system. Not to say that non-smartphone are not being market as product bundling, but the trend in Malaysia population normally youngsters and adult aged between 19 – 35, they focuses on acquiring the latest smartphones with the latest specifications. This product is targeted to technology savvy individual that follows trends and latest released items that started in the USA or China. For example, the highlighted items that been discussed in the presentation were the Iphone’s and S3 that currently being bundled with all sorts of extra items and charges. The...
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