The Problem with Treating Volume as the Only Growth Lever

When founders want to grow, they often push more units of the same product. The reasoning is solid: “The product works. We just need more people to buy it. Run ads. Drive more traffic. Run discounts. Move higher volume.”

That, however, is only one of two valid growth levers. The other, often neglected, is to increase the average order value.

You see, when a customer has already arrived at checkout, the cost of getting them there has already been paid. Furthermore, the cost of getting the product to them is largely covered by the value of the first product in their cart. Any additional products added to the cart only add marginal shipping costs (if any) to the total order.

This is where increasing the average order value through bundles becomes an invaluable tool to unlock more profit. What’s more, bundles outperform percentage discounts on single products by a mile. They are incredibly effective at not only moving more stock, but also making more profit while offering the customer better value.

Bundles can take several shapes. They can be multiples of the same product — for example, buy two wooden spoons and get a third one free. They can also be a combination of multiple products — for example, a bundle containing a wooden spoon, turner, spatula, skimmer, mixing spoon, and salad fork.

Either of these bundle strategies allows you to increase your order value while offering the customer a better price per unit. Your customer pays less per unit, and you make more money overall.

To see why this works at the math level, we need to look at the six profit levers that move on every ecommerce sale:

Five of these six levers stay almost flat whether the cart contains one product or six. Only the Product cost lever scales with units. That asymmetry is what makes bundles win. This article will show you how to set up your bundles for success.

1. Example showing you the numbers

The Bundle Model

Four scenarios side by side. The first two show the apples-to-apples comparison on three spoons — three customers at 10% off versus one customer with a 20% off bundle. The second pair shows the same comparison on six utensils at the same discount structure.

2. How to design a profitable bundle

Bundles are not so much a discount campaign as they are an order-consolidation strategy. The discount is what the customer sees. The eliminated per-order costs are what the founder banks. This is how you should treat them:

Six steps to design a bundle that scales contribution.

1. Pick products customers already buy together. Look at your order history for items that co-occur in the same cart more than 8 to 10 percent of the time. For mixed bundles, this co-occurrence data is gold — it tells you which combinations the customer already wants. For multi-pack bundles, look at customers who reorder the same single unit within 30 days — they are telling you they would have bought the multi-pack if you had offered it.
2. Test bundle size as a variable. Do not pick a bundle size by intuition. Run a 2-pack, a 3-pack, and a larger bundle (5-pack or 6-piece set) in parallel for two to four weeks. In most categories the optimal bundle size is bigger than the brand’s first instinct. Bigger bundles produce bigger per-order contribution; customers are often willing to commit to more units than you think.
3. Model the contribution before you launch. Same six-lever model you would use on any campaign, with payment processor and channel fees combined at the platform’s rate — 3% for Shopify and similar direct ecommerce, 15% for Amazon, Walmart and other marketplaces. If contribution per order at the proposed bundle size and discount beats the separate-orders baseline, ship it. If not, change the bundle, change the discount, or kill the campaign at the model stage.
4. Make sure the bundle’s per-unit price is lower than the single unit’s per-unit price. On Amazon and Walmart it is common to find 3-packs listed at a higher per-unit cost than the single. The customer notices. The conversion suffers. Always check the math from the customer’s perspective.
5. Run a 2-week test before scaling. Watch the order count, the contribution per order, and the return rate. Bundle return rates sometimes run slightly higher than single-unit rates because the customer is less certain about committing to multiples. Make sure your model held up before you commit your inventory.
6. If you are selling on a marketplace like Amazon, make sure you are the brand owner. You do not want to continually be fending off other sellers who try to undercut you on listings you created. The only way to do that is to join the Brand Registry.

3. Frequently asked questions

4. Quick reference: what to avoid and what to apply

The Problem with Borrowing Retail Discount Math

When founders use discounts, they believe they can sell more units at a smaller profit margin and therefore make more money in total. In their minds, selling more units makes more money in total.

This belief is strengthened by watching how much money big-box retailers like Walmart and Costco make each year. If they do it, it must work, right?

The problem is that retail discount math is very different from ecommerce discount math. They are not the same.

In retail, sales often only have two variable cost line items: the product cost and the credit card fee. That is it. If you cut 25% off the price you still walk away with money.

In ecommerce, the same sale can have up to six variable cost line items. We call these the Six Profit Levers:

Since all six of these levers take a slice of the profit you make on each sale, you need to keep them all in mind before you run any promotion that uses a discount.

In this article, you will learn how to model your own discount campaign so you actually make more money.

1. Example showing you the numbers

The Discount Model

Here is the same skincare order modelled at six discount tiers, holding every other lever flat. Read the contribution row at the bottom — that is the only number that matters.

How the costs stack

Read the bottom row. Every 5% of discount costs you $5 of contribution per order. By the time you hit 15% off, contribution is at zero — the order is a wash. Past 15%, every sale loses you money. The 25% Black Friday promotion turns into a $10 loss on every single jar shipped.

Three patterns to spot on the chart:

1. The discount slice grows at every tier.
2. The fixed-per-unit levers underneath (product, ad spend, warehousing and shipping, payment processor) do not move at all — they sit there absorbing nothing.
3. The cost stack crosses the $100 selling-price line at exactly 15% off. That is the threshold. Past it, every order is a loss, and the loss grows by $5 for every additional 5% of discount.

2. How to model your discounts

Discounts are not inherently bad. They are a useful tool, but they need to be used with discipline. This is how you should treat them:

1. Model before you implement. The best way to protect your profits is to model your discounts before you think of implementing them. To do that, you must have access to the other variable cost data.
2. Build the model once. Excel or Google Sheets. Use the Six Profit Levers to build your own cost stack. The output is contribution per order at each discount tier.
3. Run every campaign through the model first. Plug in the proposed discount. Read the contribution line. If it is negative, the campaign is a loss disguised as a sale. Either lift the price, lower the costs, or kill the campaign at the model stage. Not after the books close.

3. Frequently Asked Questions

4. Quick Reference: What to Avoid and What to Apply

The Fix: Anchor Pricing and Bundles

The solution had two parts. First, Sandra needed to raise her single-unit price to anchor value. Second, she needed to introduce bundle tiers that made buying more feel like the obvious choice.

Step 1 — Raise the single unit price

Sandra was selling at $12.99. We helped her reposition at $18.99. This did two things: it established a clear value anchor in the customer's mind, and it set up a meaningful contrast when the bundle was introduced. Without a credible single-unit price, the bundle discount feels hollow. With it, the bundle feels like a genuine deal.

Step 2 — Introduce bundle tiers

With the anchor set, the bundles had something to contrast against. The 3-pack at $45 ($15 per apron) and the 5-pack at $65 ($13 per apron) both offered a lower per-unit price — but Sandra's gross profit per order rose sharply because the fixed fulfillment cost was now spread across more units and more revenue.

Step 3 — Upgrade the listing to match the price

Sandra didn't just raise her price and wait. She invested in better product photography, rewrote her descriptions with a stronger brand voice, and added comparison tables that highlighted the premium features of her aprons. The listing didn't just look more expensive — it looked worth more. She began attracting customers buying for quality, not just price.

The Numbers: What Changed

Here is the before and after in Sandra's unit economics, using her actual bundle tiers:

Gross Profit Per Order: Visualised

The chart below shows gross profit dollars and GP margin across all four pricing scenarios. The story is clear — bundling converts fixed fulfillment cost from a margin killer into a margin amplifier.

The Gross Profit Formula

Before launching any bundle, always model it at the order level — not the unit level. Here is the calculation Sandra's team now runs on every new bundle configuration:

Cost Breakdown: Where Every Dollar Goes

This stacked view shows exactly how each cost layer consumes revenue across Sandra's four pricing scenarios. Watch what happens to the green gross profit bar as the bundle grows — the fixed fulfillment cost becomes an increasingly small share of revenue.

Per-Unit Price vs Gross Profit Per Order

This is the counter-intuitive core of bundling. As the per-unit price the customer pays falls, your gross profit per order rises. The two lines move in opposite directions — and that divergence is the entire profit opportunity Sandra was sitting on without knowing it.

But What About Losing Sales?

Why This Works Beyond the Numbers

Fixed costs shrink per unit

Fulfillment, storage, customer support — when these costs don't grow linearly with units, bundling compresses them across more revenue per order. The same $4.25 fulfillment cost on a $65 order is 6.5% of revenue. On a $12.99 order it was 30.8%. That difference is pure margin.

Higher AOV unlocks better ad performance

With a higher average order value, Sandra could afford to bid more on ads without sacrificing margin. A campaign that was break-even at $12.99 per unit became profitable at $65 per order — with no change to the creative, the targeting, or the spend level. Better ROAS from the same budget.

Bundles shorten the cash conversion cycle

More units sold per order means faster inventory turnover and more cash freed up for the next purchase order. In Sandra's case, the higher gross profit per order meant her inventory didn't need to churn as fast to generate the capital needed to reorder. More margin equals less cash risk — and a shorter window between paying the supplier and getting the money back through sales.

The Anchor Pricing Principle

Common Mistakes to Avoid

What Saved Sandra

It wasn't a viral moment. It wasn't a new product launch. It wasn't a better agency. What saved Sandra was better math — clean unit economics, smarter bundling, and pricing built on true cost data rather than competitive guessing.

If you are only selling single units, you are almost certainly leaving money on the table. The fulfillment cost you are paying on every single-unit order could be funding margin on a bundle. The customers who would buy a 3-pack or a 5-pack are already in your store — they just have no reason to yet.

Bundles do not just help your customers save. They help you earn more, per shipment, with less effort.