Bundling

In some situations we can approximate perfect price discrimination, even if we don’t know the consumers marginal values. Some people may wish to read about motoring or sport, and others care more about homes and style. Perhaps both are slightly interested in the news. Rather than sell separate newspapers that specialize on each topic, it’s common for a single newspaper to cover all of them. The economic term for when producers group several products together is a bundle. A good bundle will reduce the diversity of tastes, and result in more revenue than charging separately. Bundled pricing works if the willingness to pay for the bundle is more homogeneous than the willingness to pay for the separate items in the bundle.

Also see this video on the concept of bundling:

A related concept is tying (from Alex Tabarrok):