Captive Product Pricing and Product-Bundle Pricing

 Captive Product Pricing: There are certain products, which cannot be used without certain other products. 

Examples of such products are safety razor with razor blades and shaving cream, toothpaste with toothbrush, cameras with films, computers with software, fountain pen with ink, etc.

Manufacturers of such complementary products may use captive product pricing strategy where the main products priced low while the supplies can be priced relatively, High Companies which are in the business of only the main product will then find themselves priced out from the market.

This is also the strategy being followed by companies in the business of durable consumer goods (such as cars, television sets, refrigerators, etc.)

where the spares, components and servicing are charged relatively high while the relatively low prices of the main products make them competitive.

Product Bundle Pricing: Under this strategy, sellers can combine a number of their products and offer the bundle at attractive price.

For example, it is a common experience during festive seasons, retailers offer durable goods like refrigerator, washing machine, TV as a bundle at a single price which is much lower than the total price you pay for each of them separately.

Tour operators often offer package tours which include air travel, hotel and food, sight-seeing, insurance, visa fee, airport taxes, local travel etc.

The price of the total package has often been found much lower than the sum total of the prices of each item separately. If the product bundle is priced attractively, it will stimulate the sales of all items in the bundle. 

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