What Is Basket Based Pricing? How to Use This Pricing Strategy

By Thomas Bennett Financial expert at Priceva
Published on March 28, 2023
In this article, we will talk about the basket based pricing strategy. This is a fairly common and very effective method. Basket based pricing allows you to increase customer loyalty, which is an advantage for any business, because loyal customers bring more revenue than one-time customers.

Basket based pricing definition

Basket based pricing is a pricing model based on the personalized preferences of the buyer. If you follow this strategy, your customers will be encouraged to buy more.

Retailers know very well the importance of increasing the basket size now, instead of selling piece by piece over time. Here are the reasons why:
  • It will be more profitable for you if the customer purchases the product from you, and not from other retailers.
  • Instead of postponing the purchase, you can offer the customer what they want right now.
  • You can increase your reputation among customers by listening to their wishes, so you not only increase sales here and now, but also increase the likelihood that they will return to you again.

Why would you deprive your customers of the service they require, which also increases the size of their basket? Or even better, why don't you take it one step further?

Basket based pricing is a perfect strategy to take your sales to the next level, where customers receive personalized discounts based on their purchase history, previously used discounts, browser history, etc.

The advantage of using this strategy is that it encourages customers to buy from you in two ways:

  • They constantly see products that really attract their attention.
  • They get discounts on the products they are interested in.

Basket based pricing strategy examples

Let's look at some examples of how basket based pricing can be used.

Match the place of delivery and the supplier

An excellent example of how this mechanism is deployed is the way Jet.com does it. They analyze the location of the goods' delivery for the customer and select a reliable supplier. The closer the supplier's location is to the place of delivery, the cheaper the cost.

This method allows you to save profit without reducing the price of the product itself or applying discounts, because the savings are in the delivery.

Sell products at a discount to those who need them

Another example of basket based pricing is shown by Amazon. Here’s what they do: they have certain products at a discount, as well as a personalized analysis of each buyer. They have data on the preferences of each customer, and based on their past purchases, Amazon offers them similar products, but they are already at a discount.

In this case, everyone wins: Amazon, because discounted products are sold faster; and customers, because they get what they like at a discount.

Additional products at a discount

For example, a company that sells laptops and phones can offer, in addition to these basic products, cases, chargers, headphones, adapters, and so on. Even if someone initially only wants to buy a phone, they can’t help but pay attention to those additional products.

Offer similar products

This method is used by almost all e-commerce retailers. When a person views information about a certain product, they will also be shown a section with similar products. There may also be products at a discount and with the best reviews.

Do not underestimate this function, because it helps both the customer to find the right product and the retailer to promote their product. Also for the customer, it may be some additional product that they purchased because they saw it at the right time.

MyProtein’s basket based pricing strategy

MyProtein is a health and supplement e-commerce store that sells a range of products. One great strategy they use is to ask whether or not you want to supersize one of your products.

This smooth customer experience is brilliant for keeping people on the checkout page and increasing the likelihood of an additional purchase.

For example, if you spend $35 more, you get a free gift. This encourages people to head back into the category and product pages in order to claim the free gift.

Advantages and disadvantages of the strategy

Let’s consider the advantages and disadvantages of this strategy:


  • Customers will be more loyal to your brand because you take their preferences into account.
  • Customers will increase their basket size.
  • You will see a boost in sales.
  • You will be able to clear out your stock instead of letting it sit in the warehouse.


Collecting and analyzing all the information can take too much time if you don't have a department that deals with it, or special tools to help you.

If you don't want to spend a lot of time on this, you will either have to hire staff or spend money on software that will collect and analyze the information.

How to implement it

Collect data about user history: what products they bought, what offers they paid attention to, etc.

Analyze which discounts prompted the buyer to make a particular purchase.
The basket based pricing mechanism consists of collecting and analyzing information, just like most other strategies. All these processes are best handled by special software.

Benefit from marketing automation platforms/tools. Instead of devoting your limited resources to data collection and analysis, spend your time on C-level decision-making.

Remember, growing your average basket size should be an outcome, not a solitary objective. The objective should be building your relationships with customers, a relationship that they have initiated by visiting your store. When you understand the purpose of their visit, you can relate to their underlying emotions and needs to connect better with them and drive both revenue and customer satisfaction.

Final thoughts

Data collection and price analysis are important for any pricing strategy. Optimal prices are formulated based on numerous factors. This function can be performed by Price Optimization Software.

Basket based pricing is a great strategy for building a personal relationship with your customers and increasing your basket size.

By taking an intelligence-first approach, you can learn more about your customers, but more importantly, about the ways to keep them happy.

You can combine several pricing strategies and several approaches to conduct successful e-commerce. Basket based pricing will complement other strategies perfectly.


What is basket pricing in retail?

Basket pricing, a strategic approach in retail, involves setting the price for a group of items that customers frequently purchase together, focusing on the combined value rather than individual item costs. This strategy leverages the principle of optimizing the overall value of a shopping basket to encourage customers to increase the number and variety of items they buy in a single transaction, aiming to enhance customer satisfaction through bundled value deals and, in turn, increase the retailer's sales volume and profit margins.

What is a basket analysis pricing?

Conducting a basket analysis is pivotal for retailers aiming to craft effective pricing strategies, as it provides insights into purchasing behaviors and patterns, revealing which products are frequently bought together. This analysis helps retailers understand customer preferences and adjust pricing or promotions accordingly, enhancing the appeal of purchasing combinations of products. The resulting strategy might include bundling products at a discounted rate or adjusting individual product prices to incentivize the purchase of the entire set, ultimately driving up the average transaction value.

What is basket fee?

Within retail, especially in online shopping, a basket fee refers to an additional charge applied to an entire order or basket of items, rather than to individual products. This fee is often introduced to cover the complexities and costs associated with processing, packaging, and delivering a collection of items as a single purchase. Factors influencing its imposition include the operational costs associated with handling multiple items together, the logistical challenges of delivery, and strategies to encourage higher order values by offsetting these fees with minimum purchase thresholds.

What is an example of competition based pricing?

Competition-based pricing is a market strategy where a business sets its product prices in response to competitors' pricing structures rather than solely on its own costs or customer demand metrics. For instance, if a company selling high-end coffee makers notices that its main competitor has priced a similar model at $250, it might choose to set its price at $245 to attract price-sensitive customers. This strategy relies on staying closely informed about competitors' pricing tactics and market positions, and it often includes additional value propositions like better warranties or exclusive services to justify the chosen price point and differentiate from the competition.

Empower Your Business with Priceva's Price Tracking Solution
Take charge of your pricing strategy with Priceva's powerful price tracking tools.
More to explore