We all know what bundles are, right? There’s the bundle of joy we bring home from the hospital after childbirth. We bundle up the trash and take it outside to be picked up. Even Apple gets in on the bundling game.
Every year about this time Apple bundles something with new Macs or iPads. This year it was Beats headphones. Apple bundles special video shows with Apple Music. Why? Because bundles– packages of products and services– help to drive sales.
The Bundle King
Allow me to climb out a few feet onto the Limb of Prognostication and predict that Apple will have ever more bundles. We know Apple likes bundles because the company doesn’t like sales. Sears runs sales all the time and look what has happened to them. Bundles can be a good incentive to buy a product or service.
For example, once supply meets demand what can Apple do to move Macs, iPhones, or iPads (or, conversely, to sell older products before introducing a new product)?
Some critics look at bundles and consider them bribes. The name doesn’t matter. What you get is two things instead of one. Apple Music bundles the mediocre but exclusive Carpool Karaoke series and Planet of the Apps. Not only that, but Apple Music subscribers get exclusive access to various albums.
The back-to-school bundles are the most obvious bundles but Apple is in a unique position to bundle other products for customers. Buy a fully loaded 2017 iPhone and get one year of iCloud storage for free. Or, one year of Apple Music. That’s attractive, right?
Over the past few years Apple built a number of very large data centers around the country, with more on the way. Why? Obviously, with more than a billion customers Apple needs plenty of storage, but the company could easily afford it’s own built-in virtual private network– a VPN– service which could be bundled free with a Mac, iPhone, or iPad. For a year.
Sure, not everyone who uses the VPN the first year for free would sign up for a second year, but I’m certain millions would and that means ongoing revenue and profits for Apple’s rapidly growing Services division.
Look at the list of bundle opportunities Apple could dangle before our eyes.
- Buy an iPhone 8 with 512GB of storage and get a pair of AirPods included.
- Buy a Mac and get Beats headphones.
- Sign up for Apple Music and get AirPods at half price.
- Buy an iPad Pro and get the 200GB iCloud tier for one year.
See? Those are just a few of the bundle options Apple could bring to the customer base; to keep customers, and to attract new customers.
Compare bundling with what Apple’s competitors are forced to do to move product. Cut prices. Apple cuts prices but not very often. The price of the original iPhone was cut back in 2007. The iPad price dropped to $329 in 2017. Can you name something else? Even the MacBook Air, sure to be discontinued soon, remains at $999, and the MacBook and entry-level MacBook Pro are the same price; $1,299 without a bundle.
Apple’s growing Services group is ready made for bundles and I’m certain we’ll see more as Apple-developed video content shows up for iTunes and Apple Music customers.
Bundles? I like bundles.