Looking to Increase Revenue? It's Really a Package Deal.

As the outdoor and recreation industries continue to evolve, offering packages has emerged as a highly effective pricing model strategy. By bundling specific offerings, businesses can enhance their profitability, streamline operations, and effectively promote their products and services.

Looking to boost your revenue? Discover how offering packages can increase your revenue in this blog post.

1. Benefits of Packaging
   1. Increased Shopping Cart Value
   2. Simplified Marketing
2. How to Package Effectively
3. Case Study Examples

1. Benefits of Packaging

1. Increased Cart Value

The concept of "Bundle and Save" has become a popular marketing strategy, especially in the product-based market. Market leaders like Amazon and McDonald's have successfully utilized this pricing model, making it a widely accepted and favored option for customers. By offering bundled packages, you can provide your customers with a convenient and cost-effective buying opportunity.

Specifically, this widely accepted model can help you take advantage of two customer types:

1. 1. Savvy Savers: Budget-conscious travelers are always on the lookout for ways to stretch their dollars. These savvy shoppers know that purchasing a bundled package often offers more value than buying each offering separately. They prefer the convenience and savings of a bundled deal over a single, standalone option.
   2. All-Inclusive Shopper: In today's fast-paced world, shoppers are constantly searching for convenient and efficient ways to finalize their travel or vacation plans. With the extensive amount of time, up to 20 hours, spent on researching and planning, more and more individuals are gravitating towards all-inclusive options or packages. This choice not only saves them valuable time and money during the planning phase but also throughout their entire vacation experience.

You may be wondering about the benefit for your business, especially since both of these shoppers are motivated by savings. However, the true value your business gains through bundling is the increased average cart value. When visitors find your website, they are usually brought there through a single offering, typically your most popular item. When you offer a package that includes this popular item, these buyers end up spending more money with you than they originally intended. This is known as upselling, and it ultimately increases the revenue you gain from these individuals while increasing your overall Average Cart Value.

2. Simplified Marketing

By strategically bundling multiple offerings together, you can simplify your marketing efforts by focusing on promoting a single package instead of individual items. This not only reduces the number of items you need to market but also allows you to sell more for the price of what you previously sold as a single popular item, increasing your return on investment (ROI) on marketing spend.

Moreover, promoting these packages helps create awareness around your various offerings, including new or less popular ones, thereby increasing their exposure. 

2. Packaging Effectively

In order to be effective in this pricing model it is helpful to know what NOT to do.

There are two (2) primary mistakes businesses make when beginning to offer packaging:

1. Presenters Paradox
   • This phenomenon, known as the presenter's paradox, occurs when individuals are presented with a high-value item alongside a cheaper add-on. Our brains tend to place more value on the high-value item alone, rather than considering the overall value of the package. Therefore, offering a high-value item in conjunction with a cheap or lesser-perceived item may actually diminish the perceived value of the entire package. In other words, this strategy can do more harm than good. It's important to avoid including a cheap item that may undermine the perceived value of the overall package.
2. Decision Fatigue or Overwhelm
   • Offering too many options can lead to indecision when making a purchase. Some businesses make the mistake of including an overwhelming number of items in their packages, requiring customers to make multiple decisions when the intent was to reduce decision requirements. For instance, if you are an all-inclusive fishing resort, your packages may include everything needed for a multi-day stay. However, not all of these inclusions need to be emphasized or discussed during the purchasing process. The key strategy here is to minimize the number of decisions customers have to make, ensuring a quick and simple payment process. 

Once you understand what to avoid doing when implementing a packaging strategy below are a few tactics to keep in mind when developing your own packaging strategy:

1. Piggy Back On Your Top Selling Items
   1. If you have a "most popular" activity such as rafting, pick a complementary offering to package with it that helps your visitors feel like they are filling their vacation itinerary. By packaging these less popular items with the "easy sell" you help increase the exposure of the added item. Just remember to not "cheapen" the whole with something that doesn't bring its own value to the package.
      
      Read on to see how this strategy was implemented successfully for a live operator!
      
      
2. Gift Bundling
   1. By providing bundles that offer the ideal package for families or loved ones, you can increase sales while tapping into the potential for higher revenue during shoulder or off-seasons. Gift bundles are a popular choice among customers looking for unique experiences, and they present an opportunity for your business to attract more diverse customers and boost profits.
   2. Another smart choice for gift bundling is to create packages tailored for special occasions such as birthdays, holidays, and family reunions. By crafting and promoting these packages specifically for these events, you expand your marketing strategy, reaching a wider audience and potentially tapping into new market segments that you may not have reached otherwise.

3. Case Studies

1. Rapids and Ropes Package

Swift Water Adventures based out of the St. Louis River near Duluth, Minnesota decided to develop a packaging strategy focused on selling a new activity offering, an Aeriel Challenge Course.

Their goal was to grow revenue through retention vs. acquisition and increase the growth of the ropes course by attaching it to bread and butter offering - rafting. 

The outcome was stellar! The Rapids and Ropes package became the #2 BEST SELLER and 25% of rafters are opting for the package instead of just rafting.

The Swift Water team found that "Packaging has been far more effective than social media or digital ads to promoting and creating awareness of the new service." 

1. All-Inclusive Resort Packaging

Teton Valley Lodge, located in Driggs, Idaho, was determined to stand out from the competition. To achieve this, they made the strategic decision to create an innovative all-inclusive packaging strategy. By simplifying the booking process and placing emphasis on the dates as the sole determining factor, they successfully differentiated themselves in the market.

The outcome proved extremely valuable! They sold out two consecutive summers, all through direct bookings.

By bundling everything they offer at Teton Valley Lodge into one seamless booking process guests were able to quickly and confidently make a buying decision that resulted in soldout bookings.

Flybook Reservation Software offers a packaging specific feature allowing you to manage inventory, resources and staff across multipe offerings while still providing packaged solutions - Learn More

Looking to Manage More and Grow? The Flybook Reservation Software Can Help.