Offering products in kits, combos and sets boosts sales and repeat business.
By Emily Lambert
If you’re looking to raise your dollar sale per customer (and who isn’t?), bundled products are a great way to do it. Whether it’s an aquarium starter kit or a two-product solution to canine tearstains, bundled products are not only multiple sales with one swoop of the UPC code, they also often invoke future purchases of full-size products.
According to Dave Williams, vice president of sales for the World Wide Pet Industry Association Inc. in Monrovia, Calif., “A bundled product is always a good idea. It always increases the average sale for the dealer, if it’s a value for the consumer.”
KollerCraft, a U.S. manufacturer of desktop aquariums, headquartered in Shawnee, Kan., offers more than 30 different kinds of starter kits, with a focus on the beginner and intermediate betta fish customer.
Packaging is key to selling bundled products. Because bundled products offer the advantage of space, there’s a lot of opportunity to explain what [the product] is, noted Lorna Paxton, co-founder and president of Happytails, wholesaler of canine grooming products in Los Angeles.
“There’s more packaging to explain it on,” she said.
This translates not only to verbiage about the product (a feature that can assist salespeople in selling it) but also to pictures that create a sense of what it would be like to own the product.
For instance, with a picture of a fish swimming in a colorful aquarium on a start-up aquarium kit, customers can easily picture the product in their house, making the sale that much easier, reported Donald Fleming,
resident and owner of Quality Pets Inc., wholesaler of pets and pet supplies in Oklahoma City, Okla.
The bundle merchandising is also important.
“Kits are more like an impulse buy item,” said Andrew Kim, owner of Healthy Spot, a Santa Monica, Calif.-based canine store. “We position them around the new dog stuff. We put the kits at eye level and the bigger sizes below.”
Fleming recommended that retailers place starter kits on endcaps across from the animals about to be purchased.
Moreover, don’t forget using point-of-sale signage to draw attention to a special promotion, reminded Andrea Pellegrino, senior marketing manager for Mars Fishcare Inc.
Lastly, keep price point in mind.
“We used to have larger kits with three full-sized products,” Paxton said. “It was too much money. You have to watch out for that. If it’s under $20, most people can afford it, but when it gets over $50, they usually can’t.”
“What the aquarium kit provides is convenience,” said Rand Kollman, vice-president of sales and marketing for KollerCraft. “It’s one-stop shopping, everything [the customer] needs is in one box.”
One of KollerCraft’s most popular units offers LED underglow lighting with interchangeable colors. In the future, KollerCraft will be placing a greater emphasis on models that offer LED lighting, said Kollman, because it is “child-friendly, merits the eco-star and lasts for five years.”
Donald Fleming, president and owner of Quality Pets Inc., wholesaler of pets and pet supplies in Oklahoma City, Okla., noted that aquarium starter kits make the decision to get a fish that much easier due to both convenience and cost.
“These are general entry-point items that offer consumers a better value,” Fleming said.
The company’s kits include booklets to help educate customers and ensure their success.
“From the consumer standpoint, everyone enjoys a cost savings, especially in today’s economic climate,” said Andrea Pellegrino, senior marketing manager for Mars Fishcare Inc., manufacturer and supplier of aquarium and pond products in Chalfont, Pa.
Consumers relate favorably when they are getting something more for the same price or something for nominally more than they would have paid for one item. Mars uses bundled products to encourage consumers to try a new product or an item they may not have considered using before, Pellegrino noted. For example, API’s Tropical Fish Start Up Pack contains two aquarium water conditioners, noted Amy Vesey, the company’s marketing manager. (API is one of the four brands under the Mars Fishcare umbrella.)
Retailer Kelvin Stanke, owner of Critter Jungle, a pet-supply store specializing in natural products in Ottawa, Ontario, Canada, sells starter kits for a variety of animal species. Stanke noted that bundled products offer items that get a customer’s foot in the door.
“These are not items we price to make big profits on, they’re more to bring people into the hobby,” he said. “The emphasis is on the after sale in three to four weeks to replenish their supplies.”
While there are many advantages of bundled products, such as starter kits, there are also challenges to be aware of, said Jason Casto, director of marketing and product development for Super Pet Brand in Elk Grove Village, Ill., a U.S. manufacturer of hard goods for birds and small animals.
“Wholesalers might put products in [starter kits] that the retailer doesn’t carry,” he said. “If a customer starts off on a bag [of food] and the retailer doesn’t carry it, that’s not good. Retailers need to consider if the products in their kits are driving the brands in their stores.”
With Happytails Canine Spa Line’s bundled four-packs of 2-ounce-sized products, retailers are “able to plant four little seeds for customers to sample and come back to the store to buy full-sized products of,” said Lorna Paxton, co-founder and president of Happytails, wholesaler of canine grooming products in Los Angeles.
Happytails also sells a bundled two-pack solution for canine tearstains, its bestselling Eye Pack, and the recently launched Ear Aid to help with canine ear problems.
Andrew Kim, owner of Healthy Spot, a Santa Monica, Calif.-based canine store, reported that a lot of customers buy Happytails’ collections as gifts, which are packaged in small plastic totes with product details on the back panel and a gift hangtag on the front. Collections also come marketed specifically for special occasions.
“For holidays, we have had Santa Paws for dogs, Santa Claws for cats, Hanukkah Hound, Be My Valentine’s collection and Celebrity Dog, which is available all year, but we push it during Oscar month,” Paxton said.
From a retail-profit standpoint, Kim stated the margins are higher for stand-alone products.
“However, you’re moving the average ticket up per customer,” said Kim, who retails Isle of Dogs’ bundled products as well. “Although we give up margin, we make it up on a dollar basis.”
Make Your Own Bundle
Retailers can also create their own bundles. Ruth Hanessian, president of Animal Exchange, a pet store specializing in locally raised pets in Rockville, Md., creates her own parakeet starter kits, which include a $4 discount on food.
Hanessian prefers this option to prepackaged kits containing food because she worries about their freshness. To combat the potential problem of stale food in starter kits, some manufacturers, such as Super Pet Brand, offer freshness guarantees.
“In addition to replacing food that has expired, we always pack in small quantities and encourage retailers to order in minimum quantities,” Casto said.
At Critter Jungle, Stanke creates customized packages based on customers’ needs.
“We bundle packages together one-on-one with our customers,” Stanke said. “If someone’s getting a new puppy, we’ll walk through the store with them. To encourage them to get whatever they need at one time, we offer them a 15-percent discount.”
At Healthy Spot, two is the magic number.
“What we see packaged well together are when we discount one item, and sell it with another regular-priced item, such as you buy a toothbrush and get a discount on the toothpaste,” Kim said.
Many companies, such as Vètoquinol, a French manufacturer of pet-wellness products with U.S. headquarters in Buena, N.J., encourage retailers to create their own bundles by presenting promotions to distributors in a bundled fashion, reported Teresa Hanson, Vétoquinol’s marketing director. This enables retailers to offer value pricing on a group of products, such as pet flea and tick protection in the spring, or emergency-preparedness kits during hurricane season.
Bundles, whether prepackaged or not, have much to offer: higher ticket sales, the opportunity to create repeat customers and a way to promote slower moving items. The bottom line: Bundles are a category you can bank on. <HOME>
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