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Bundling and Unbundling of Products
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Every product is either being bundled together or torn apart.
The Idea
Jim Barksdale's line: "There are only two ways to make money in business: bundling and unbundling." Craigslist unbundled the newspaper classifieds section; then new products unbundled Craigslist into Airbnb, StubHub, and many more.
Why It Matters
- Incumbents bundle to raise prices and lock customers in.
- Insurgents unbundle by doing one part dramatically better.
- The cycle repeats — today's unbundler becomes tomorrow's bundle.
How to Apply
- If you're starting out, look for a fat bundle and pull out the part that's painful.
- If you're growing, add adjacent features carefully — bundles rot when the edges get weak.
- Watch for your own product getting unbundled by a sharper competitor.
Examples
- Spotify unbundled the album into playlists; is now rebundling with podcasts.
- Microsoft Office bundled; Google Docs unbundled; Notion is rebundling.
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