Inferred Transaction Value: a Key to Understanding the Effects of Price Bundling

EXTENDED ABSTRACT - This paper examines a common marketing tactic called price bundling, defined as the practice of marketing multiple products and/or services at a bundle price (Johnson, Herrmann, and Bauer 1999). Examples include the purchase of a car where the basic model and options are bundled into a package or the purchase of a skiing pass good for multiple days. Behavioral research on price bundling has traditionally viewed the psychological impact of price bundling in separation from, and as violation of, its economic logic (Prelec and Loewenstein 1998; Soman and Gourville 2001). This frame overlooks the possibility that some of the psychological impact of price bundling may be driven by its economic logic.

Citation:

Roger Heeler and Nguyen, Adam (2004) ,"Inferred Transaction Value: a Key to Understanding the Effects of Price Bundling", in NA - Advances in Consumer Research Volume 31, eds. Barbara E. Kahn and Mary Frances Luce, Valdosta, GA : Association for Consumer Research, Pages: 584-585.