“Would you like fries with that”? So it goes, when we think of driving additional income for any business, McDonalds approach to point of sale cross sell has become part of everyday business vocabulary. McDonalds is proof that a simple, repeatable prompt from the its frontline workforce, can deliver an enormous impact to the bottom line as reported by TNW.
But McDonalds too has been grappling with change and the world’s transition to digital. It’s not just fries that McDonald’s has perfected in the cross sell. The Covid-19 pandemic has driven acceleration of changes to McDonalds business model, some of which are likely to remain permanent. If there was any doubt in where they see the future heading. McDonald’s purchase of AI company Dynamic Yield in 2019, signified that AI and Machine learning would be their next weapon in pricing, bundling and providing contextual sales triggers.
As McDonalds has proven in perfecting their meal bundles and point of sale triggers, satisfying customer demand (often latent) and preferences with precision, should be a truly scientific exercise no matter how simple it is in the actual delivery of the message. Perfecting these triggers, product combinations and bundles requires continuous testing and feedback and a relentless focus on optimization which can be accelerated now by machine learning.
In the world of eCommerce, product bundling has become a whole lot more interesting due to the myriad of APIs, digital services and subscriptions customers can now be offered. Online retailers and wholesalers have an ever increasing opportunity to generate ancillary/affiliate income streams, around their core offerings. Blending physical products with digital products into hybrid bundles is commonplace today.
These offerings can have a dramatic impact on perceived customer value, repeat purchase intent, as well as margin and profitability of an online business and lifetime value of the customer.
Consider Apple’s very latest announcement with the launch of Apple One. Amidst declining rates of device refresh for their flagship iPhone range, Apple has made a bold statement in their transition towards more subscription based revenue – a bundling of up to six digital services accessible through Apple’s range of devices. Consider Forbes staggering statistic that 70% of Americans with incomes of $150,000 or more, have an Amazon Prime membership. Apple is rarely first to the game, but a they have shown repeatedly they have achieved near mastery in perfecting and improving the experience. Apple One appears almost compelling value for most of Apple’s devoted customers, but better still, may be it’s biggest attack yet on the likes of Netflix, Spotify, Dropbox, Peloton and Strava.
So here’s 8 tips to grow your eCommerce business through intelligent product bundling:
David Lynch is Group CTO for bolttech.