Preference between Individual Products and Bundles: Effects of Complementary, Price, and Discount Level in Portugal

Abstract

This paper aims to (1) compare consumers’ preferences between individual products and bundles as well as (2) investigate some of the factors involved in bundle characteristics that may affect consumer’s preferences. Those factors are complementarity, price level, and discount level. An online survey developed by means of questionnaires were collected from the Portuguese population. Student’s t-tests were used to test the hypothesis formulated and to analyze the consumers’ preferences. The findings corroborate that in a scenario where the bundle does not offer any discounts, preference of individual products is higher. When a 20% discount is assigned to bundles, the overall preference for individual products is still superior. By offering a discount level of 45%, the overall preference for bundles becomes higher. The positive effect of complementarity bundles valuation is confirmed. This is the first approach to evaluate the preferences between bundles and individual products in the Portuguese market. The findings contribute to clarify the customer map within a Business Model Canvas. Furthermore, this paper analyzes the bundle complementarity and discount level effects simultaneously.