I love our packing cubes! They help keep small items organized, your items compact, and the different colors help differentiate what-belongs-to-whom. I do a combination of bundling and cube packing: I pack one child's clothes (rolled to reduce space and minimize wrinkles) in two color-coded cubes (the ebags "slim" ones). I put my swimwear, undies, socks etc. in another cube. I use that cube as my "core" item for bundling my clothes, put the bundle in the suitcase, and then arrange the child's clothing cubes around the edges. My husband does the same for his clothes, and the other child's. This way, we're able to fit a week's worth of clothes for two people (one parent and one child) in each of two carry-ons! In fact, we'd probably use cubes for our clothes too, but we don't have enough at this point. (The cubes are relatively pricy.)
Plus, as another poster mentioned, when we go to unpack the items in the cubes, it's as easy as taking the cubes out, unzipping the top, and placing them in a dresser drawer.