For both marketing and software development organizations, scaling operations is typically the biggest roadblock to revenue growth. White label services are a common technique for agencies to boost profitability by increasing margins while also increasing top-line revenue.
Meeting deadlines while providing consistently high-quality client experiences may be difficult for busy firms. The lack of a certain skill set for a given customer might throw your entire team off and cause the contract to fall through.
White label products and services are sold under the brand name of a company but developed by a third party, the third party removes their brand and logo from the end product and instead uses the branding requested by the purchaser. Customers seldom contact with or learn about third parties. White label and private label are phrases that can be used interchangeably to describe the same technique.
If you go to a grocery shop like Target, for example, you'll see that the Made By Design brand sells a variety of things. Is this to imply that Target manufactures all of those items? Certainly not! They just have a number of suppliers that already supply those items and are prepared to put them in Target's Made By Design packaging rather than their own.
To give a more specific example, if your agency specializes in search engine marketing, you may delegate the development and optimization of websites or landing pages to a third party to assist your customer. This is a simple and practical way to provide a comprehensive service to your clients without revealing your internal lack of development resources inside of your organization. The consumer will think that the agency built everything and that you would provide them with whatever they needed.
White label services are a type of outsourcing, however instead of outsourcing to another country, you select a partner that will not only manage their own team but also supply high-quality products or services to your clients under your brand. The study found 34% of organizations outsources at least some of their operations to 3rd party.
The internet is becoming increasingly diverse, agencies might gain edge by providing a variety of specialized client services.Obviously, obtaining and keeping such a diverse set of talents is costly. This is particularly true for smaller agencies. If you have clients that want a certain set of missing skills or services from your agency and might leave you to find other providers, it is time to consider white labeling some of the missing skills or services.
There are several methods to expand your service offerings. Either recruit new competent employees, use 3rd party agency as white label or utilize SaaS. Hiring new employee is time and cost consuming, and there may not be a need for them when the project is completed. Agencies, on the other hand, may be able to supply you with a skill set that you are now lacking, as well as assist you in keeping your clients. Another common technique to expand your services is to use third-party SaaS to expand the variety of services your firm offers without having to deal with a third-party agency.
Small and medium-sized agencies are finding it more difficult to compete with larger agencies, with the most typical strategy being to specialize in a tiny niche to compete with them. Clients prefer larger agencies because they can handle a wider range of tasks, despite small and medium-sized agencies' outstanding reputation and rates.
Many of the projects entrusted to the agencies are repeatable, and the majority of the pieces are relatively easy. To compete on pricing for small and medium-sized organizations, they must use their resources properly and cut costs in order to compete on pricing. Adopting white labeling or SaaS on basic and repetitive duties frees up your time to focus on high-value clients. As a consequence, costly internal resources, such as software engineers, may be directed towards the most valued ventures.
You may reduce your COGS and overhead expenses by establishing a process that can be implemented by a white label partner. Although there may be some additional administrative costs, white labeling compensates for this with flexibility and lower prices. In a competitive market, this allows agencies to offer reduced pricing and gain a competitive advantage.
Sometime SEM agencies can be blocked on launching a campaign or new project due to small obstacles on the client's end. For example, a website redesign or missing landing page can block the launch of your campaign. If your agency does not provide certain services, white labeling might be an effective way to avoid losing a new contract.
When you employ white labeling, you lose a little control, and it may be more difficult to keep track of deadlines. However, with strong follow-up from both sides, this should be rather simple to resolve. Additionally, prior to picking a white label provider, you should conduct some research on former clients to limit the risk of unreliable delivery.
When delivering a project to a customer via white labeling services, the agencies are always liable for the end results. With that in mind, establishing quality controls is a must in order to avoid tarnishing the company's reputation. One approach is similar to the one mentioned above: frequent follow-ups and research them before hiring.
Onboarding and getting into a working rhythm with a white label partners takes time and effort. Not everyone can afford such a significant time investment up-front. To ensure that there is a two-way trust, agencies should take it slow and start from small project and grow gradually
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