- How does White Labeling work?
- Benefits to White Labeling
- Who and how should use White Labeling
- Best sectors for White Labeling
- Wrapping up
How do you minimize costs when developing a new product? How do you meet customer needs and spread awareness of your brand? If you’re asking yourself these questions, you might want to look into the partnership model known as “White Label” (WL). This article outlines who can benefit from this business model (Spoiler: literally anyone) and how to smoothly integrate it into your business.
How does White Labeling work?
White Label is a highly scalable business partnership model whereby Company A (Provider) produces a product or service and Company B (Reseller) sells it under its name to an end customer.
The name “white label” comes from the music industry. Back in the day, promo records were sent out to radio stations and music stores in an unfinished state. Their labels were completely white. Resellers and distributors had to design the label themselves, depending on how the new music was accepted by the public.
Nowadays, the WL model is widely used across all types of businesses, both online and offline. Here are a few examples:
- items sold by supermarket chains under their own brands;
- payment cards which larger banks issue for smaller ones;
- discount coupons and cashback offers;
- affiliate links across blogs and forums;
- cross-sell digital services.
While Labeling comes with amazing customization options. When buying a WL license from the provider, you get the liberty to brand their products and service with your corporate colors, patterns, etc. As a result, in your customers’ minds, these products will be inevitably associated with your company. Keep in mind that you’re buying a finished product whose characteristics you’re not allowed to change or even slightly adjust. With that said, it’s crucial to find a reliable supplier which would offer products of impeccable quality.
The WL model relies on the CPA (cost per action) monetization scheme. You get paid for each client you brought to the WL provider. It can be a fixed amount per customer, or a percentage of their order.
Benefits to White Labeling
How is the WL partnership better than developing and manufacturing a product yourself? Take a look at 5 key benefits that the WL model has to offer!
1. Saved time and money
It’s no secret that creating a product takes plenty of time, money, and human resources. Moreover, if the product you want to create is a new territory for you, prepare to make heavy investments into research, development, and employee training. In this case, it makes total sense to purchase a turnkey solution and focus your efforts on promoting it among your target audience.
2. Passive income
With a solid provider and savvy marketing strategy, white labeling can generate a steady extra income while requiring little efforts on your side.
3. Customer loyalty
Think about what products and services your customers may find useful and make them an offer they can’t refuse. Don’t make your audience wait too long. Otherwise, you risk seeing them leave to your competitors. By meeting your audience’s needs and solving their problems, you’ll strengthen the loyalty of your customers and maximize your brand value.
4. Higher search position
Marketing a new product requires improving your ranking across search engines. This way, you’re killing two birds with one stone. A clever SEO campaign is a surefire way to attract new customers and add authority to your website.
5. Improved website design
It makes sense to dedicate a separate page on your website to your branded White Label product. A fully-fledged page makes a better impression than flashing banners that tend to get on users’ nerves and distract their attention.
Who and how should use White Labeling
What brands can potentially benefit from white labeling? The good news is that the WL model fits all types of businesses, from mass media agencies, to online stores, to travel agents. To capitalize on WL, your website must meet two main criteria.
1. Your website topic musк align (or at least overlap) with that of your WL provider’s site. Ask yourself what value you can offer to your target audience.
If you have a car-themed website, be sure to post content which car owners can find interesting. If you’re monetizing your travel blog, it might be a good idea to add a service that would allow your visitors to search airline tickets, find travel companions, or book accommodation. At the same time, promoting a beauty parlor on a financial website is hardly a good idea. It will look out of place and drive away potential clients.
The one exception to this rule is mass media sites or forums that attract different audiences. Thore are great platforms for promoting discount coupons, cashback offers, promo codes, and other deals which are great at catching the eye of users.
2. Your product must meet the needs and fit the budget of your potential customers. Be sure to partner with brands that have audiences similar to yours. If you target young people, it would make sense to work with budget-friendly, accessible brands. If, however, you specialize in premium goods, be sure to search a WL provider within the same niche. The more accurately you fit the needs of your target audience the more likely your customers will make a purchase and come back for more.
Once you’ve found an ideal WL provider, you need to make the most out of this business opportunity. Here are two crucial things that you need to do:
1. Prepare your website. Make sure your new product gets the exposure it needs. Take the time to prepare your website and social media pages. Grow your audience, add compelling content, and improve your SEO. If your website has a good traffic flow and ranks high in search results, it won’t be long till your WL product starts to generate income.
2. Develop a promotion strategy. As a reseller, you need to handle marketing all by yourself. Find a subtle, unobtrusive way to introduce your new product to your audience: publish links on your homepage (header, menu, main text, etc.), write new articles for your blog, promote the product on social media, etc.
Best sectors for White Labeling
As we’ve already said, the WL model can be successfully used across a variety of industries. Let’s focus on the five main sectors where the WL partnerships are especially common. Look carefully! You might find your industry among the ones listed below!
The software company ShieldApps offers 10 tailored White Label products, including anti-virus programs for PC and Android, widgets, cleanup utilities for Windows, online security tools, and more.
For their WL software program, ShieldApps uses a catchy slogan, “Our Technology, Your Brand”. The company’s WL solutions are 100% rebrandable, which means you can put your brand name on them, as well as use the branding (colors palettes, icons, creative fonts, etc.) of your choice. It’s a great way to enhance your brand awareness and authority.
The ZenBusiness logo maker enables you to create a professional brand identity online within a matter of minutes. If your customers might be interested in a service like this, you should absolutely add the ZenBusiness tool to your website. Branded with your logo and contact information, the online constructor will appear your own developed solution!
SatchelPay offers a vast array of fintech solutions for resellers and affiliates. By opting for SatchelPay’s WL program, businesses can get access to state-of-the-art payment and IT infrastructure. On top of that, each WL user gets a license for providing financial services across 31 countries within the EU.
Utilities and home services
The Methodia company offers an all-in-one WL license that allows you to sell a wide spectrum of household services, including gas and electricity services, telephony, TV, water, maintenance, and more. The company provides full support to their clients and takes care of all processes, allowing you to focus exclusively on sales and marketing.
Amadeus offers a convenient mobile app for travel agencies. Among other things, users can create and modify travel routes, receive notifications on flight delays, and access information on exchange rates, weather forecasts, etc.
White Label is a beneficial partnership model whose popularity is spreading like wildfire. It’s a great money-making opportunity for businesses who lack resources to develop a product of their own. However, like any business model, it has both strengths and weaknesses. Let’s see the two sides of the WL coin!
By using WL, you can:
- grow your product line;
- cut product development costs;
- boost revenue;
- enhance your competitive advantages;
- increase your brand visibility;
- gain new customers.
One the flip side, the WL model has its fair share of drawbacks:
- You’re not allowed to make any changes to the WL product, including its technologies, design, etc.
- You need to prepare your website for the new product.
- You need to invest time, money and fresh ideas into promoting the new product.