A simulation-based approach to price optimisation of the mixed bundling problem with capacity constraints

In this paper, we analyse a service provider’s mixed bundling problem for services such as sporting events or holiday packages. Pursuing the objective of maximising total revenue, the service provider has to determine static prices for each single product at the beginning of the selling period. Additionally, an optimal package price has to be chosen for the bundle that comprises one unit of each single product. Because of capacity constraints, the availability of products can change over time such that consumers are forced to switch from their preferred subset of products to an alternative following dynamic substitution.