Why Companies Make You Choose a Bundle
The way businesses structure their offerings influences how consumers research products.
- By
- September 29, 2026
- CBR - Economics
Suppose you want to purchase new accounting software for your business. You have in mind what features you’d like, but the company’s website offers only a few set menus at different prices, identified in tiers with descriptions such as “basic,” “pro,” and “enterprise.” This kind of product bundling is common for everything from streaming-service packages to phone plans to online education.
These preset packages do more than limit the choice of what customers can buy, according to Chicago Booth’s Agathe Pernoud and Stanford’s Frank Yang. Their research suggests that product bundling can itself influence how consumers shop, by changing what they find worthwhile to learn about before making a purchase.
Economists have long studied how customer preferences drive companies’ decisions about bundling. A key insight from microeconomics research is that bundling is useful for sellers when customers’ priorities vary widely: One buyer might place a high value on Product A and a low one on Product B, while a second buyer might do the opposite. Rather than sell the products separately, companies create bundles that require customers to buy both together. The bundling process averages out differences in willingness to pay, allowing sellers to capture more of the products’ combined value.
Pernoud and Yang, adding a twist to this understanding, ask also how bundling might influence what consumers choose to learn about when shopping. The researchers devised a mathematical model in which buyers, unable to investigate every aspect of a purchase, must decide what information will be most useful. They might focus on comparing individual products—what the researchers call “horizontal learning”—or they might investigate factors that affect the value of several products at once, such as the company’s reputation, a functionality that the items share, or the usefulness of the products for a particular context. The researchers call evaluating information that makes all of the products seem more or less valuable “vertical learning.”
Their model assumes that the seller has significant pricing power—like an enterprise software company, for example, or a streaming service with exclusive content.
“Think, for instance, of OpenAI, which decides how to bundle its products into different membership tiers as well as how to price these tiers,” Pernoud says. “When firms enter the market with new products, it’s reasonable for consumers not to know much about what these products are and to need to learn how much they are willing to pay for them.”
The researchers’ model, representing a state of equilibrium, explores how the way consumers learn affects companies’ decisions—and, in turn, how bundling affects the way consumers learn.
From the CBR Podcast
Are You Shopping Irrationally?
What are the mental connections we’re making between various expenses, and how can understanding them help us make better decisions?
Are You Shopping Irrationally?The study examines which combinations of buyer research and seller pricing can coexist with neither side having an incentive to change its strategy. Consider a buyer who engages in horizontal learning. When products are sold separately, a buyer who learns that Product A is more valuable to her than Product B can simply buy A. But given the possible range of valuations the buyer might reach through their research, the seller could earn more by bundling Products A and B.
The seller doesn’t prevent buyers from researching individual products; rather, its pricing structure changes how useful that information would be. Once the products must be purchased together, the value the buyer might place in individual items becomes less relevant to their decision. Now, what matters more is whether they believe the entire package is worth the price. This outcome means horizontal learning and the seller’s most profitable pricing strategy cannot form a stable combination in the mathematical model.
Pernoud and Yang find that in such a case, buyers will opt for vertical learning, seeking out information that increases or decreases their estimated value of each product in the same direction. In the accounting-software example, shoppers might examine broader signals, such as how well the products would integrate into their own businesses. This could make several of the company’s offerings seem more or less valuable at once.
Given this buyer pattern of vertical learning, sellers in turn benefit from offering “nested” bundles, in which a basic package is supplemented by higher tiers providing more features. The premium add-ons could look like AI analytics in software or one-on-one coaching in an online course. When buyers’ valuations tend to move together, those who place relatively little value overall on the seller’s products can choose a basic tier, while those who value the offerings more highly can be charged more for packages with upgrades. The model predicts that buyers end up learning more about the premium features than about those in lower tiers, because the value of the additional features helps determine whether moving up to a more expensive package is worthwhile.
Vertical learning isn’t always a buyer’s preferred strategy, the researchers find. When products are sold separately, researching their relative values—horizontal learning—can be just as useful because buyers can act on what they learn. By the same logic, competition between multiple sellers could make horizontal learning more valuable. The model considers a single seller, however, and does not demonstrate what might happen in a competitive market.
Pernoud and Yang provide one explanation for why nested bundles can be profitable and stable when buyers must decide what to learn. Companies that have meaningful pricing power may benefit from limiting choice, thereby shaping what information is valuable to buyers.
Agathe Pernoud and Frank Yang, “Bundling Against Learning,” Working paper, October 2025.
More from Chicago Booth Review
More from Chicago Booth
Your Privacy
We want to demonstrate our commitment to your privacy. Please review Chicago Booth's privacy notice, which provides information explaining how and why we collect particular information when you visit our website.