Customized Bundle Pricing for Information Goods: A Nonlinear Mixed-Integer Programming Approach

Shin-yi Wu
Shin-yi Wu
[email protected]
Nanyang Business School, Nanyang Technological University, Singapore 639798, Singapore
Search for more papers by this author
,
Lorin M. Hitt
Lorin M. Hitt
[email protected]
The Wharton School, University of Pennsylvania, Philadelphia, Pennsylvania 19104
Search for more papers by this author
,
Pei-yu Chen
Pei-yu Chen
[email protected]
Tepper School of Business, Carnegie Mellon University, Pittsburgh, Pennsylvania 15213
Search for more papers by this author
,
G. Anandalingam
G. Anandalingam
[email protected]
Robert H. Smith School of Business, University of Maryland, College Park, Maryland 20742
Search for more papers by this author

Shin-yi Wu

[email protected]

Nanyang Business School, Nanyang Technological University, Singapore 639798, Singapore

Search for more papers by this author

Lorin M. Hitt

[email protected]

The Wharton School, University of Pennsylvania, Philadelphia, Pennsylvania 19104

Search for more papers by this author

Pei-yu Chen

[email protected]

Tepper School of Business, Carnegie Mellon University, Pittsburgh, Pennsylvania 15213

Search for more papers by this author

G. Anandalingam

[email protected]

Robert H. Smith School of Business, University of Maryland, College Park, Maryland 20742

Search for more papers by this author

Published Online:1 Mar 2008https://doi.org/10.1287/mnsc.1070.0812

Supplemental Material

mnsc.1070.0812-sm-ec.pdf (67 KB)

Cited by
- A Heuristic for Bundle Pricing With Interrelated Products
  11 May 2026 | Naval Research Logistics (NRL)
- Bargaining over Data and Analytics: Sellers, Buyers and Consultants
  Jyotishka Ray,
  Syam Menon,
  Vijay Mookerjee
  21 April 2026 | Information Systems Research, Vol. 0, No. 0
- Proxy-Aided Demand Learning with an Application to Various Pricing Problems
  Tao Shen,
  Yifan Cui
  13 November 2025 | Operations Research, Vol. 74, No. 2
- Learning to Sell a Focal‐Ancillary Combination
  10 June 2025 | Naval Research Logistics (NRL), Vol. 72, No. 8
- Will they stay or will they go? application of machine learning classifiers of purchase and churn prediction to a digital journalistic platform
  25 December 2024 | Journal of Media Business Studies, Vol. 22, No. 3
- Partition and Prosper: Design and Pricing of Single Bundle
  Hailong Sun,
  Xiaobo Li,
  Chung-Piaw Teo
  19 February 2025 | Operations Research, Vol. 73, No. 4
- Optimal Bundling Cooperation Strategies for Online Paid Membership Programs
  4 November 2024 | Naval Research Logistics (NRL), Vol. 72, No. 3
- When to Share My First-party Content: the Role of Membership Bundles in Content Platforms
  26 October 2023 | Information Systems Frontiers, Vol. 27, No. 1
- A gradient descent algorithm for computing choice probability in the bundle size pricing problem
  2 December 2024 | SCIENTIA SINICA Mathematica, Vol. 55, No. 2
- Bundling Variety, Usage, or Both? A Multi-Service Analysis of Pay-Per-Use and Subscription Pricing
  8 August 2024 | Production and Operations Management, Vol. 33, No. 10
- Optimizing Size-Based Bundle Promotions: Balancing Customer Appeal and Product Costs
  1 January 2024 | SSRN Electronic Journal, Vol. 28
- Supplier versus platform bundling: Optimal strategies under agency selling
  Transportation Research Part E: Logistics and Transportation Review, Vol. 179
- Interactive bundle pricing strategy for online pharmacies
  Transportation Research Part E: Logistics and Transportation Review, Vol. 177
- Highly debated but still unbundled: The evolution of U.S. airline ancillary products and pricing strategies
  18 May 2022 | Journal of Revenue and Pricing Management, Vol. 22, No. 4
- A numerical optimization approach for pricing components in customer defined bundles in a B2B market
  Computers & Operations Research, Vol. 155
- Validate proof of information service financing scheme model by using the customer self-selection bundling strategy based on quasi-linear utility function
- Bundling Variety, Usage, or Both? A Multi-Service Analysis of Pay-Per-Use and Subscription Pricing
  1 January 2023 | SSRN Electronic Journal, Vol. 90
- Breaking Boundaries: A Novel Heuristic for Bundle Pricing with General Product Inter-relatedness
  1 January 2023 | SSRN Electronic Journal, Vol. 28
- Online Learning and Optimization for Revenue Management Problems with Add-on Discounts
  David Simchi-Levi,
  Rui Sun,
  Huanan Zhang
  12 January 2022 | Management Science, Vol. 68, No. 10
- Competitive Pricing for Multiple Market Segments Considering Consumers’ Willingness to Pay
  1 October 2022 | Mathematics, Vol. 10, No. 19
- A study on promotion with strategic two-stage customized bundling
  Journal of Retailing and Consumer Services, Vol. 68
- Optimal Bundling of Platform Memberships Under Horizontal Cooperation
- Itemized pricing in B2B bundles with diminishing reservation prices and loss averse customers
  24 June 2021 | Journal of Revenue and Pricing Management, Vol. 21, No. 4
- Managing Customer Search via Bundling
  Chenguang (Allen) Wu,
  Chen Jin,
  Ying-Ju Chen
  1 March 2022 | Manufacturing & Service Operations Management, Vol. 24, No. 4
- A review on competitive pricing in supply chain management problems: models, classification, and applications
  26 November 2021 | International Transactions in Operational Research, Vol. 29, No. 4
- A portion cap rule with two products: An experimental evaluation
  29 May 2022 | Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Vol. 70, No. 2
- An Approximation Scheme for Data Monetization
  1 June 2022 | Production and Operations Management, Vol. 31, No. 6
- Price and revenue bounds for bundles of information goods
  9 August 2021 | Naval Research Logistics (NRL), Vol. 69, No. 3
- Optimal adoptions of freemium version and patching strategy: Network and security externalities
  Journal of Management Science and Engineering, Vol. 7, No. 1
- Convex Optimization for Bundle Size Pricing Problem
  Xiaobo Li,
  Hailong Sun,
  Chung Piaw Teo
  5 November 2021 | Management Science, Vol. 68, No. 2
- Component Pricing with Bundle Size Discount
  SSRN Electronic Journal, Vol. 28
- Customer-driven Bundle Promotion Optimization at Scale
  SSRN Electronic Journal, Vol. 69
- How Do Machine-Generated Contents Mitigate the Cold Start Problem in Online Platforms?
  SSRN Electronic Journal, Vol. 24
- Bundling strategies for platforms with an installed base
  JUSTC, Vol. 52, No. 7
- Quasi Linear Utility Function Based-Wireless Internet Incentive-Pricing Models
- How to Sell a Data Set? Pricing Policies for Data Monetization
  Sameer Mehta,
  Milind Dawande,
  Ganesh Janakiraman,
  Vijay Mookerjee
  10 September 2021 | Information Systems Research, Vol. 32, No. 4
- Optimal bundle composition in competition for continuous attributes
  European Journal of Operational Research, Vol. 293, No. 3
- Mapping the Ethicality of Algorithmic Pricing: A Review of Dynamic and Personalized Pricing
  10 December 2019 | Journal of Business Ethics, Vol. 170, No. 4
- Product Bundle Recommendation and Pricing: How to Make It Work?
  SSRN Electronic Journal, Vol. 69
- Bundling and pricing decisions for bricks-and-clicks firms with consideration of network externality
  Journal of Industrial & Management Optimization, Vol. 17, No. 5
- Retailer-driven bundling when valuation discount exists
  22 August 2019 | Journal of the Operational Research Society, Vol. 71, No. 12
- Maximizing E-Tailers’ Sales Volume through the Shipping-Fee Discount and Product Recommendation System
  Discrete Dynamics in Nature and Society, Vol. 2020
- Online Learning and Optimization for Revenue Management Problems with Add-on Discounts
  SSRN Electronic Journal, Vol. 28
- Managing Customer Search via Bundling
  SSRN Electronic Journal, Vol. 90
- Leader-follower game in the airlines when the add-on is unbundled from the flight ticket
- Cardinality Bundling with Spence–Mirrlees Reservation Prices
  Jianqing “Fisher” Wu,
  Mohit Tawarmalani,
  Karthik N. Kannan
  11 June 2018 | Management Science, Vol. 65, No. 4
- Bagging bundle benefits in broadband and media mergers: Lessons from Sky/Vodafone for antitrust analysis
  Telecommunications Policy, Vol. 43, No. 2
- To Have Your Cake and Eat It? A Two-Period Model for Retailers’ Mixed Bundling or Reserved Product Pricing Strategies in Response to Supplier Encroachment
  IEEE Access, Vol. 7
- How to Sell a Dataset? Pricing Policies for Data Monetization
  SSRN Electronic Journal, Vol. 45
- The determinants of network effects: Evidence from online games business ecosystems
  Technological Forecasting and Social Change, Vol. 134
- Pricing strategies for information products with network effects and complementary services in a duopolistic market
  19 January 2018 | International Journal of Production Research, Vol. 56, No. 12
- Bundling strategies for complementary products in a horizontal supply chain
  Kybernetes, Vol. 47, No. 6
- Impacts of service uncertainty in bundling strategies on heterogeneous consumers
  Electronic Commerce Research and Applications, Vol. 28
- LINGO-based optimization problem of cloud computing of bandwidth consumption in the Internet
- Bundle Pricing Decisions for Fresh Products with Quality Deterioration
  Journal of Food Quality, Vol. 2018
- A unique optimization model for deterministic bundle pricing of two products with limited stock
  18 February 2017 | International Journal of System Assurance Engineering and Management, Vol. 8, No. S2
- Intertemporal mixed bundling strategy of information products with network externality
  Computers & Industrial Engineering, Vol. 113
- Improved bundle pricing model on wireless internet pricing scheme in serving multiple qos network based on quasi-linear utility function
- Improving Profits by Bundling Vertically Differentiated Products
  1 August 2017 | Production and Operations Management, Vol. 26, No. 8
- Optimal pricing and composition of multiple bundles: A two-step approach
  European Journal of Operational Research, Vol. 259, No. 2
- Estimating demand for fixed-line telecommunication bundles
  Telecommunications Policy, Vol. 41, No. 4
- RESEARCH ON THE MOTION PICTURE INDUSTRY: STATE OF THE ART AND NEW DIRECTIONS OFF THE BEATEN TRACK AWAY FROM THEATRICAL RELEASE
  1 March 2016 | Journal of Economic Surveys, Vol. 31, No. 2
- Optimal Design on Customized Bundling Strategy of Information Goods for Customers with Two-Dimensional Heterogeneity
  21 April 2017 | Asia-Pacific Journal of Operational Research, Vol. 34, No. 02
- Bundle-Pricing Decision Model for Multiple Products
  Procedia Computer Science, Vol. 112
- Acquisition planning and scheduling of computing resources
  Computers & Operations Research, Vol. 76
- An enhanced logarithmic method for signomial programming with discrete variables
  European Journal of Operational Research, Vol. 255, No. 3
- References
  1 November 2016
- Increasing loyalty in the arts by bundling consumer benefits
  Arts and the Market, Vol. 6, No. 2
- Pricing and composition of bundles with constrained multinomial logit
  4 April 2016 | International Journal of Production Research, Vol. 54, No. 13
- Free Versus For-a-Fee: The Impact of a Paywall on the Pattern and Effectiveness of Word-of-Mouth Via Social Media1
  1 March 2016 | MIS Quarterly, Vol. 40, No. 1
- Pricing Personalized Bundles: A New Approach and An Empirical Study
  Zhengliang Xue,
  Zizhuo Wang,
  Markus Ettl
  13 November 2015 | Manufacturing & Service Operations Management, Vol. 18, No. 1
- Learning Valuation Distributions from Bundle Prices
  SSRN Electronic Journal, Vol. 66
- Automated Design of Revenue-Maximizing Combinatorial Auctions
  Tuomas Sandholm,
  Anton Likhodedov
  28 October 2015 | Operations Research, Vol. 63, No. 5
- Redesigning promotion strategy for e-commerce competitiveness through pricing and recommendation
  International Journal of Production Economics, Vol. 167
- Retailer and Manufacturer Bundling in Distribution Channels
  13 October 2014
- Implications of Heavy-Tailedness
- Strategien für Softwareanbieter
  26 May 2015
- A simulation-based approach to price optimisation of the mixed bundling problem with capacity constraints
  International Journal of Production Economics, Vol. 145, No. 2
- Mixed Bundling of Two Independently Valued Goods
  Hemant K. Bhargava
  15 February 2013 | Management Science, Vol. 59, No. 9
- Numerical investigation on mixed bundling and pricing of information products
  International Journal of Production Economics, Vol. 144, No. 2
- Product bundling: Impacts of product heterogeneity and risk considerations
  International Journal of Production Economics, Vol. 144, No. 1
- Pricing of Wireless Services: Service Pricing vs. Traffic Pricing
  Atanu Lahiri,
  Rajiv M. Dewan,
  Marshall Freimer,
  24 August 2012 | Information Systems Research, Vol. 24, No. 2
- Operations Research (OR) in Service Industries: A Comprehensive Review
  18 April 2013 | Systems Research and Behavioral Science, Vol. 30, No. 3
- Retailer-Driven Product Bundling in a Distribution Channel
  Hemant K. Bhargava,
  9 August 2012 | Marketing Science, Vol. 31, No. 6
- A Framework for Automated Bundling and Pricing Using Purchase Data
- Optimizing E-tailer Profits and Customer Savings: Pricing Multistage Customized Online Bundles
  Yuanchun Jiang,
  Jennifer Shang,
  Chris F. Kemerer,
  Yezheng Liu,
  9 February 2011 | Marketing Science, Vol. 30, No. 4
- Chapter 18 Pricing
- Strategien für Softwareanbieter
  31 January 2011
- Optimal Solutions for Mixed Bundling of Two Independently-Valued Goods
  SSRN Electronic Journal, Vol. 90
- Bundling Strategies When Products Are Vertically Differentiated and Capacities Are Limited
  Mihai Banciu,
  Esther Gal-Or,
  Prakash Mirchandani,
  25 October 2010 | Management Science, Vol. 56, No. 12
- Why give away something for nothing? Investigating virtual goods pricing and permission strategies
  10 December 2010 | ACM Transactions on Management Information Systems, Vol. 1, No. 1
- Optimal Bundling Strategies Under Heavy-Tailed Valuations
  Rustam Ibragimov,
  Johan Walden,
  11 October 2010 | Management Science, Vol. 56, No. 11
- Pricing problem in wireless telecommunication product and service bundling
  European Journal of Operational Research, Vol. 207, No. 1
- Inferring preference correlations from social networks
  Electronic Commerce Research and Applications, Vol. 9, No. 1
- Equilibrium Market Segmentation for Targeted Pricing Based on Customer Characteristics
  SSRN Electronic Journal, Vol. 27
- Preisstrategien von Softwareanbietern
  22 October 2009 | WIRTSCHAFTSINFORMATIK, Vol. 51, No. 6
- Pricing Strategies of Software Vendors
  22 October 2009 | Business & Information Systems Engineering, Vol. 1, No. 6

Volume 54, Issue 3

March 2008

Pages iv-626

Article Information

Supplemental Material

Metrics

Information

Received:April 17, 2007
Published Online:March 01, 2008

Cite as

Shin-yi Wu, Lorin M. Hitt, Pei-yu Chen, G. Anandalingam, (2008) Customized Bundle Pricing for Information Goods: A Nonlinear Mixed-Integer Programming Approach. Management Science 54(3):608-622.

https://doi.org/10.1287/mnsc.1070.0812

Keywords

PDF download

Available Issues

Available Issues

Available Issues

Available Issues

Available Issues

Available Issues

Available Issues

Available Issues

Available Issues

Customized Bundle Pricing for Information Goods: A Nonlinear Mixed-Integer Programming Approach

Supplemental Material

Volume 54, Issue 3

Article Information

Supplemental Material

Metrics

Information

Cite as

Keywords

Sign Up for INFORMS Publications Updates and News