White Label VS Private Label
The difference between white label and private label can be really blurry when it comes to using modern technologies.
#1. Modifying the product
The first dissimilarity lies in the possibility to modify the product. In the case of white label services, you are selling the product you have bought without making any changes to it. As for the private label, it is a product manufactured for exclusive sale by a certain re-seller. He has the right to customize the product in some way that makes this product exclusive.
For example, you decide to purchase a computer mouses. Using the white label strategy, you can sell them without any changes.
And if you are buying the same computer mouses using the private label strategy, you can add some specific features to them to make the product stand out from the competitor’s offers.
#2. The type of product
The second important difference lies in the type of offer. Today, the private label is often identified with physical products like oils, shoes, bags or table games. And white-label goods nowadays become more and more associated with digital marketing solutions like software or web services.
But these marketing strategies have some similarities. They both are the perfect solutions in that case when you want to:
- diversify your current market offering,
- penetrate the new market,
- add some new revenue streams!
So what should you choose – private label or white label branding?
You should be aware that white labeling is much more attractive! It doesn’t imply some serious re-branding or integrated distribution network to achieve your goals.
What Is White Label?
White labeling is a type of partnership in which one company produces goods or services, and the other sells them under its own brand.
Such an approach saves companies from the need to invest in creating their own technologies and infrastructure. Providers of white label products or services allow you to focus on product quality and increase your sales without investing in sales development.
Today, such a partnership scheme is most often used by organizations with large customer bases and a reputable brand.
Now, knowing what is white label marketing, we can reveal this question in more detail! You will understand how this strategy works, determine the differences between a white label and a private label, and find out how to start a white label business!
How White Labeling Works?
Marketers often compare white labeling with drop shipping. The company, that offers product or service, proposes you to buy them at a lower price than you will resell for the price you want. Note: you distribute these goods under your brand name, not under the producer’s brand name. In other words, from that moment you are selling your own product!
The same thing with white label branding. You can set a higher price, than the one you pay to the provider.
What is the difference between white label and outsourcing?
We bet you are now thinking that white label is the same thing with outsourcing, right?
Well, do not confuse white label services or products with outsourcing. The reason for that is the quality of a product or service. When you are purchasing a white label product, the quality is controlled by the contract and by your company. You are literally outsourcing client work to a partner you trust.
The perfect example is YouTube: in order to post your video content, you have to use YouTube services. So they are technically white labeling their web service to you. You can post your video on their online platform using their ready-made web infrastructure (by the way, the same thing with website builders).
Who are the most active white-label strategy users?
Traditionally it is believed that white-label projects were created for internet marketers, bloggers, site owners. In a word, they were made for those who know how to effectively draw traffic, which will turn into orders of goods or services.
But the market is growing and evolving! Now, the white label solution trend is becoming more and more popular even for those who do not yet have a website.
What types of organizations are using white label the most?
Today, whitelable is typically used by:
- companies that offer the mass production and sale of electronics, consumer goods, and software packages;
- website, that uses the strategy for allowing successful brands to offer their services without making additional investments in technology and infrastructure;
- companies, engaged in selling goods in private supermarkets and grocery stores under the store’s brand;
- small banks, that buy credit cards from larger ones to reduce their production costs.
Benefits of white labeling
White label companies can offer their own, different conditions to partners. But more often, terms of white label agreement implies the following benefits:
- Quick launch of the cooperation program. A partner can provide a new type of service in a short time. Thereby, he can quickly increase competitiveness in the market. The time needed for developing and testing a new product when using white-label is 2-5 times lesser than developing and testing your own, brand-new solution.
- Reaching new target audiences. The seller of the white label solution may receive additional income from the end customers of his direct client. This gives the possibility to enter new markets. The buyer can extend the functionality of the product. Thus he can attract customers to whom these features are important.
- Integration opportunities. Often, off-the-shelf services can be easily adapted and integrated into the existing partner platforms. For example, they can be integrated into billing or delivery service systems.
- Ready infrastructure. The party acquiring the finished product does not need to invest in the initial stages of release and support. Also/ there’s no need to pay for the work of additional specialists. The cost of developing a solution yourself exceeds the purchase price of a turnkey solution by 2-7 times (depending on the region of the United States).
- Additional support. Very often, partners are offered the support of qualified specialists from the white label company. In case of difficult situations, additional support will help to quickly provide the solution.
- Reduced customer churn. Customer loyalty increases if the white label services provider offers a greater number of them. The customer does not need to look for other suppliers.
- Branding. The partner can design the service acquired in his own corporate style. Also, he can install it with his domain names.
- Flexible pricing. Typically, companies implementing white-label marketing solutions offer flexible pricing and discounts. It depends on sales. The partner creates the final retail price independently for customers. It is always negotiable.
- Postpay option. A partner can provide services and accept client payments. After, he can pay for the services on a monthly basis upon use and depending on the number of sales.
How to start a white label business?
Think if you are ready to pay the white-label branding.
As with any business, you should calculate the costs of your project before you start. You should be aware that white label branding will cost you more than drop shipping or reselling a product. But the long-term returns of this business are often higher!
Decide what product you will be selling.
White label business allows you selling different kinds of products. The question is not actually finding a type of product that you can sell under the white label, but the one that can make you some money.
And the demand and competition are the questions you have to answer in the first place.
Choose the target market.
You have to determine your perfect customer. Ask yourself: what customer segments are most likely to buy the product you are selling?
This helps to decide what white label product types you will be selling and determine the ways you will be marketing them.
Think about the factors that will differentiate your offer.
Analyze your competitors’ offers; find out their focus, their lack. The spot where your competitors are lacking the most is a perfect area for positioning your product.
Want an example? You’re welcome: if «rivals» use a too formal tone, you can opt for a funny, even goofy attitude. It won’t change a lot, but selling white label generic products don’t require you to be unique – just a little different!
Create an experience.
Do you think that the brand is just a product, a logo, and advertising? Your brand is more than that! The crucial element of your brand is the way the customer experiences your brand.
Basing on your differentiators, you have to find out the unique ways your customers experience your brand.
For example, you can use bright social media photos of your product, or detailed consultations, or exclusive packaging.
Find a suitable white-label partner.
How to find a good white label partner? In order to do that, try to find the company that:
- Has vision and goals that are similar to yours;
- Offers solid white label product or service that is suitable for your startup;
- Has a solid market reputation;
- Is an experienced white-label partner;
- Offers excellent customer support;
- Offers reporting and/or analytic system;
- Has clear contract terms;
- It offers a full white label product or service test drive.
White label products ideas: 18 trending offers of 2019
We’ve prepared the list with almost all types of whitelable marketing solutions that are in a high demand today.
The first three product ideas are the most common:
1. B2B white-label products that are provided by a company that sells them to re-sellers. In turn, they resell them to the end customers, that are companies.
2. B2C white-label product is offered for a reselling by a company to the end customer, which is a consumer.
3. Whitelabel SaaS solutions are licensed on a basis of a subscription and are hosted over the Web (no downloads required). Re-seller brands this software solution as his own and sells it to his customers. Unlike the traditional service method, when you are offered an annual subscription, here you can choose a monthly subscription. The returns come evener!
And here are some specific white-label offerings:
4. Content is simply a written copy (case studies, articles, blogs, eBooks, emails, ads, etc)
5. Dashboard: rebrandable dashboard on various kinds of white-label software provided to resellers customers.
6. Digital advertising that helps to build search engine marketing campaigns for re-seller’s customers using his brand.
7. Digital agency: white-label marketing agencies may offer different services, but mostly they provide reputation and listing management, online promotion and social network solutions.
8. Digital marketing: these can be whitelable marketing products/services for re-seller’s customers.
9. Listings management: software can be outsourced but branded as the company’s own. The agency has the right to set its price and sell the software to its customers. The software is provided by the whitelable software provider.
10. The marketing software platform is branded by a re-seller and sold by his price.
11. Marketplace, where re-sellers have the ability to curate a variety of products, applications, solutions and even packages of solutions for their customers as their own.
12. Platform: reseller brands the software, marks up his price and resells to his customers.
13. Products are produced by one firm and resold by another one under its brand. The «most wanted» products of 2019 are:
- essential oils,
- reusable shopping bags, and cups,
- hair loss products,
- party games,
- phone accessories,
- tracking devices,
- e-cigarettes, еtс.
14. Reputation management: online reputation management software can be outsourced but branded as the company’s own. The company marks up the price and sells the software to its customers. The software is provided by whitelable providers.
15. SEO software is outsourced but branded as the company’s own. As usual, it has the right to set its own price for this SEO software product that is offered by whitelable providers.
16. Services: re-sellers have the right to resell any rebrandable service to the end customers.
17. Social media management: re-seller can sell specific SM marketing software to his business customers. This allows him to increase the customer base and engagement and share the content through SM channels.
18. Websites: re-sellable, user-friendly platforms for creating websites can be sold to various web-design and web-development studios.
As we have already mentioned, white-label goods nowadays become more and more associated with digital marketing solutions like software or web services like creating websites.
White Label in Website Building
Do you know that everyone needs websites? Of course, you do. Website design & hosting appear to be a great $90 billion market. Yet less than 70% of studios offer website solutions. So, underestimating this demand is a grand missed business opportunity!
Well, «underestimating» may not be the right word. A lot of studios would be glad to offer amazing white labeling websites… but they still don’t think about white label solutions as an option. And this option allows increasing their customer base without hiring a team of developers/designers!
Why use the white label if you are a web developer/designer?
Have you ever thought about creating your own brand as a web developer?
Attempting to build it from scratch may be hard enough. And this concerns not only the process of developing a unique logo, which will be associated only with your designs. Branding requires constant marketing efforts that can distract you from increasing brand popularity and awareness.
One of the main pitfalls that developers can face is marketing activities that are unfamiliar to them. In order to find time for promoting and selling their brand, developers stop the primary work they have succeeded in.
But that has no sense right?!
If you are a web developer or web designer, the white-label can become the goldmine for you! You do not have to waste your time thinking through promotion strategies, finding sales channels, selling your solutions and providing after-sales service. Everything is already done by the website builder!
The white labeling website builder is the perfect opportunity:
- website builder white label solution is your chance to use the famous builder as your own!
- the white-label website builder is your opportunity to open your own web studio Thus, you can create websites for your customers yourself, or offer them the proven solution!
One of the most advanced today’s solutions is the Weblium website builder. It helps to make websites for any business in any industry. Intuitive, user-friendly editor, a huge collection of modern templates with unique design, really fast websites and a competitive price give your brand-new agency a bunch of significant advantages over the competitors.
Being a young brand, Weblium was awarded in «Product of the Day» and «Product of the Week» nominations by ProductHunt. Weblium offers client-oriented premium services that will suit your vision and brand. Quality and confidentiality are Weblium’s core of the business.
Weblium white-label web development solution enables you to offer more services to your clients without investing in new staff or equipment. White labeling allows you to sell website solutions without any knowledge of CSS, HTML, coding and the like.
As your white labeling partner, Weblium will do all the job while you will get all the credit!
What opportunities you will get using Weblium white-label website builder:
• you can link your personal domain (if you already have a website that you previously promoted, such as a studio website). You link a domain to a Weblium account – and you automatically get a Weblium website builder on your personal website. Buy the way, it works even for a WordPress website! Your customers will be able to create their sites on your platform (they will be on your sub-domain);
• also, using advanced Weblium technologies (templates, blocks, integrations), you can build websites for your clients yourself (as a web studio). You will be able to set up your own branding in the admin panel (logo, etc.), so that the users will see only YOUR branding, but not Webmium’s;
• you can set your own prices for services. Getting the Pro website (transferring the site to the client and connecting his domain), costs only $126 for the subscription. This is the cost of the domain and hosting included. With each subscription, you get a 50% commission!
Why A White Label Solution Is Easier Than Building Your Own
Earning with a white label product is much easier than creating your own brand – that’s a proven fact. Let us explain why:
- Time and money saver. Some still think that customized solutions are always better than ready-made ones. Wrong! Developing your own brand from scratch takes lots of time and effort. While you are designing, building and testing your brand, others get ahead of you and enter the market earlier! You’re losing the money spent on branding and money you haven’t got from new customers.
- Easy-to-create brand. A white label solution is easily integrated into the business and does not require any effort on your part. You simply add your labeling to your creations and continue working.
- Suitable for you and your customers. Since you want the existing customers to stay and get the new ones, you should use the advantages of white-label branding. It allows you to quickly create your brand and easily make it recognizable to your target audience.
- Focus on your work instead of focusing on marketing. Not every web developer can be a good marketer. You can learn brand promotion techniques and try a number of ways, but you may still fail. With the white label services or products, you take care of your business, and your white-label partner takes care of everything else!
With white labeling, you won’t have to:
- reinvent the wheel;
- slow down your time to market;
- spend a huge budget on developing already existing solutions;
- miss out on resources and expertise in the specific space where you need a focused solution.
Today, a lot of companies, from startups to multinational corporations are looking for ways to maximize their customer engagement. Perhaps you are considering using your existing resources and creating your own communication tools. But ask yourself: will it matter to your business?
If your business grows around the communications, then white-label is an excellent solution. However, in this case, creating your own development can be a daunting task.
Do not divert employees from their primary tasks, if there are decent ready-made expert white-label solutions available on the market!