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Sun Oct 28 2012 16:56:41

eBay's New Bundle of Joy

By: Brian Cohen

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Those of you who watch History Channels' reality show "American Pickers" know that Frank Fritz's "trademark move" is bundling when negotiating with sellers. Frank provides an incentive for sellers to part with their junky treasures (one man's junk is another's treasure) by grouping items together and negotiating one price for a lot rather than pricing each item individually. Negotiation Theory and Practice Blog by Chad Ellis explains how there is a psychological component when Frank presents a bundle as a more attractive alternative to a seller:

"If someone makes an opening offer of $300 it can be emotionally difficult to come down to $200 even if their BATNA (Best Alternative to a Negotiated Agreement) is $180. They may be afraid of being a sucker (e.g. if the buyer's BATNA is really $320) or they may be embarrassed about asking for $300 if they were actually willing to sell for $200. It may be as simple as seeing their final offer of $250 as winning and anything else as losing...even as they think, "I'd really hate to lose this sale."

"By bundling, Frank gives them an out. They're getting their price (I think he always has the bundle come out at or slightly above the price they wanted for the larger item) in exchange for throwing in a little extra. That feels like a shared win, even if from the numbers alone Frank is getting his price."


Frank might be surprised that his "trademark move" was just sent to the United States Patent and Trademark Office as a patent application "Methods and Systems for Merchandising Products in Bundles in an Online Marketplace" by eBay. I found eBay's bundling patent application to be highly customizable and I will present to you notable extracts from the patents below:

"...With conventional online marketplaces, sellers typically have limited options when it comes to promoting their items, and particularly, providing potential buyers with incentives to purchase multiple items...sellers may list two or more related, but different, products for sale to potential buyers. The related products may be listed separately in the online marketplace, such that each product has its own item listing. In some instances, a seller may embed one or more links in a particular listing to one or more listings of related products. Alternatively, a seller may manually bundle one or more products into a single advertisement or listing within the online marketplace, for example, by generating a single listing that describes two or more related products being offered together..."

"...A "bundle," as used herein, is the purchase of two or more items from a selection of products sold by a seller. A bundle may or may not be predicated on an incentive provided by the seller... "


"...(With this invention) the bundling interface used by the seller to define a bundle... provide(s) one or more incentives associated with the bundle."

 "... product bundles ... allow a buyer to select and purchase multiple related products being offered via independent listings by the seller. In defining a product bundle, the seller may provide a discount or some other incentive to the buyer who buys multiple products from the seller. The seller may benefit by having higher sales volume and reduced transaction costs... "


"...the incentives may include discounts on individual primary or secondary products, a discount based on the number of products added to a bundle, a discount based on a total price of a bundle, a discount on shipping (e.g., secondary items ship free with the primary item), (...gift certificates) a warrantee or extended warrantee, a more generous return policy, a "buy one, get one free" offer, a discount applied to additional items, or the like. The seller may further dictate other aspects of the bundle such as start date of a bundle, end date of a bundle, a number of items that a buyer can select to be in a bundle, a ranking of inventory to be included in the bundle (discussed in more detail below), cross-bundling agreements with other sellers..." 

"For example, a primary product may be a camera that is associated with accessories such as tripods, lenses, cases, additional memory, photograph printing supplies, digital imaging software, flashes, etc. The accessories may be referred to as "secondary products"..."

And the most interesting part of this patent application is the cross-bundling agreement:

"...the seller may establish cross-bundling agreements with other sellers. For example, the seller may include a product in a product bundle ... that he does not have in inventory or that is frequently sold out. The other seller may sell the same product but have those items in inventory. In these instances, the seller may include the other seller's items in a bundle sold to a buyer..."

While eBay does already have a very limited type of bundling automation through both Calculated/Combined & Promotional Shipping:

"Offering a shipping discount helps promote your item and encourages buyers to buy additional items from you...Calculated shipping rules let you combine multiple purchases from a buyer into one shipment, which is generally less expensive than shipping items separately... Promotional shipping rule, you can offer buyers special discounts if they buy multiple items or spend a certain amount. You can also charge a maximum shipping amount for a single order."

"Methods and Systems for Merchandising Products in Bundles in an Online Marketplace" brings bundling to a whole new level. Bundling is a win-win-win (eBay-Seller-Buyer) strategy.

Meanwhile, Amazon was just granted Patent 8,290,818 on October 16, 2012 (they applied back on November 19, 2009) for "System for recommending item bundles."

What type of products will you be bundling? And for that matter, can you think of some products that should "never" (unless being mischievous is your type of thing) be bundled? Discuss below!

About the Author
Brian Cohen has been an active member of the eBay community since May 1998. He currently trades under the member name Bidofthis.com. His first AuctionBytes article was published in May 2002. Brian can be contacted through his website at BidofThis.com where he always has a "little Bid of This and little Bid of That."
 




Comments (18) | Permalink

Readers Comments

eBay's New Bundle of Joy   eBay's New Bundle of Joy

This user has validated their user name. by: Al G

Sun Oct 28 18:51:06 2012

First of all "reality TV" isn't!

It is first and foremost - entertainment.

While the "stars" of American Pickers are personalities - I find that driving 2000 miles in their van & loading up with, perhaps 20 items per "show" and profiting - what $1000? $2000? incredulous for a week on the road for 2 people with chow, lodgings, gas (diesel?).

Yeah bundling gives them the edge.

As far as offering the same thing on ebay - why not. But, this is not the buyer offering the seller the bundle - it is the contrapositve.

It's just another gimmick used by the former plaid pants crowd trying to sell you a new barzoom 8 at your local auto emporium.

Hello - I'll toss in the pin striping and undercoating for FREE if you just sign now.

As P T Barnum said (paraphrased of course) "There is a sucker born every minute".

So, for those of you that see this as an opportunity to get on the "bundle" wagon - more power to you.

For the other 5% of the opposite spectrum, the air-sickness bags are in the pouch just below the tray.

For the other 90% of the unwashed masses - it just made your day - eh?

eBay's New Bundle of Joy   eBay's New Bundle of Joy

by: mylifeisgood This user has validated their user name.

Sun Oct 28 19:24:00 2012

The MBA'S at Fleabay are now officially BRAIN DEAD.

eBay's New Bundle of Joy   eBay's New Bundle of Joy

by: JoJo This user has validated their user name.

Sun Oct 28 23:23:13 2012

urk

eBay's New Bundle of Joy   eBay's New Bundle of Joy

by: Bloggo This user has validated their user name.

Mon Oct 29 00:04:48 2012

Yet another ridiculous Patent. There used to be clear standards that had to be met such as "Original and Non-obvious".
Original and Non-obvious : An invention involves an inventive step if, when compared with what is already known, it would not be obvious to someone with a good knowledge and experience of the subject.

eBay's New Bundle of Joy   eBay's New Bundle of Joy

This user has validated their user name. by: bitbybit

Mon Oct 29 00:24:44 2012

I guess we can no longer refer to newborns as a "bundle of joy". It is sickening how everything is becoming commercialized.  

eBay's New Bundle of Joy   eBay's New Bundle of Joy

by: comet This user has validated their user name.

Mon Oct 29 02:27:15 2012

Did ya want fries with that?

eBay's New Bundle of Joy   eBay's New Bundle of Joy

by: Theresa This user has validated their user name.

Mon Oct 29 08:17:47 2012

Dear Lord, as if eBay's programmers could successfully pull off setting this up!

eBay's New Bundle of Joy   eBay's New Bundle of Joy

This user has validated their user name. by: Rexford

Mon Oct 29 08:59:55 2012

For God's sake, would someone send a brain to eBay's "think tank".

eBay's New Bundle of Joy   eBay's New Bundle of Joy

by: HomeGrownPromos This user has validated their user name.
Web Site

Mon Oct 29 13:37:30 2012

Is the patent licensing the act of bundling? Is there anything special about how they bundle? I don't understand the use of this patent.

eBay's New Bundle of Joy   eBay's New Bundle of Joy

This user has validated their user name. by: Tula

Mon Oct 29 13:58:33 2012

@Bloggo: So true. These vague ideas and concepts should not be allowed to be patented. So many patents these days are being granted on processes or business methodologies that have been used for years. It's nothing more than a money grab for lawyers. The patent office really need to hire some people with common sense.

eBay's New Bundle of Joy   eBay's New Bundle of Joy

This user has validated their user name. by: bitbybit

Mon Oct 29 14:29:09 2012

Shampoo, rinse and repeat

eBay's New Bundle of Joy   eBay's New Bundle of Joy

by: bonnibairn This user has validated their user name.

Mon Oct 29 21:03:34 2012

Bundle of joy?  How about Son of Zombieland...tap, tap

eBay's New Bundle of Joy   eBay's New Bundle of Joy

by: Mr. Me This user has validated their user name.

Tue Oct 30 00:46:56 2012

Seems like a bundle of %##^

eBay's New Bundle of Joy   eBay's New Bundle of Joy

by: Steevo This user has validated their user name.

Tue Oct 30 02:31:41 2012

I should send an opposition the USPTO.  

I have been bundling just like that for over 30 years.

Add something to the deal to make it look better for the other side.  

eBay's New Bundle of Joy   eBay's New Bundle of Joy

by: Steevo This user has validated their user name.

Tue Oct 30 02:34:24 2012

Oh, BTW, that BATNA stuff is from ''Getting to Yes'', a book on ''principled negotiation'' by Roger Fisher.

I read that over 30 years ago, and I have to say it changed my life.

Everyone ought to read it!  

eBay's New Bundle of Joy   eBay's New Bundle of Joy

by: tc This user has validated their user name.

Tue Oct 30 14:43:56 2012

Hasn't this already been done?

eBay's New Bundle of Joy   eBay's New Bundle of Joy

This user has validated their user name. by: permacrisis

Wed Oct 31 09:50:41 2012

Never mind the specifics. Focus instead on the overall intent.

That ebay holds the patent on online auctions at all is disturbing. Their summer 2007 buyoff of Yahoo Auctions US speaks volumes. That was ebay's Alaska purchase right there, they got a deal on that one.

A real 'ebay' would blow this cardboard-cutout version out of the water, and they know it.

That's why they are building a patent moat, so that if anyone figures out the 'special sauce' and gets it right, they can just slap a suit right on that vibrant, refreshing marketplace and just sue it out of business.

It makes me sad because you know in all these new, VC funded incubators they have now,smart guys are saying, ''Hey- let's build an ebay!'' and their counsel is saying, ''Hey- let's not.''

eBay's New Bundle of Joy   eBay's New Bundle of Joy

by: Patricia This user has validated their user name.

Wed Oct 31 14:19:35 2012

I love American Pickers...they are not only fun to watch but they also travel through some awesomely beautiful countryside.  That's all I have to say about that....



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