White-label product

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A white label product or service is a product or service produced by one company (the producer) that other companies (the marketers) rebrand to make it appear as if they made it.

Contents

History

The name derives from the image of a white label on the packaging which can be filled in with the marketer's trade dress. Its origins can be traced to vinyl records. Before records were to be released to the public, often before official artwork was designed and printed, promotional copies were sent out to DJs to solicit radio and nightclub play, in an effort to build hype and gauge public interest by the record labels, ultimately to better estimate manufacturing quantities. This created a situation where certain respected or well-connected DJs would have exclusive copies of material, immediately increasing demand on certain big records. Occasionally this term refers to records whose labels had been torn off or covered with a white label by competing DJs to conceal which records they were using.

Common use

White label production is often used for mass-produced generic products including electronics, consumer products and software packages such as DVD players, televisions, cream and web applications. Some companies maintain a sub-brand for their goods, for example the same model of DVD player may be sold by Dixons as a Saisho and by Currys as a Matsui, which are brands exclusively used by those companies.[1]

Some websites use white labels to enable a successful brand to offer a service without having to invest in creating the technology and infrastructure itself. For instance, the DVD Rental services of Tesco are run by LoveFilm. Many IT and modern marketing companies outsource or use white label companies and services to provide specialist services without the need to bring in new staff.[citation needed]

Most supermarket private brand or store brand products are provided by companies that sell to multiple supermarkets, changing only the labels. In addition some manufacturers create low-cost generic brand labels with only the name of the product ("Cola"). Richelieu Foods, for example, is a private label food manufacturing company producing frozen pizza, salad dressing, sauces, marinades, condiments and deli salads for other companies, including Hy-Vee, Aldi, Save-A-Lot, Sam's Club,[2] Hannaford Brothers Co.,[3] BJ's Wholesale Club (Earth's Pride brand) and Shaw's Supermarkets (Culinary Circle brand).[3]

Smaller banks sometimes outsource their credit-card or check processing operations to larger banks. The larger bank issues and processes the credit cards as white label cards, typically for a fee, allowing the smaller bank to brand the cards as their own without having to invest in the necessary infrastructure. A current example of this is Cuscal Limited providing white-labelled card and transactional products to Credit Unions in Australia.

In Southern California, City National Bank (CNB) is the largest check processor in that half of the state, because in addition to checks issued by its own customers, CNB processes checks for the customers of more than 60 smaller Southern California banks.

See also

References

  1. ^ Alka Katwala (2009-09). "Fade to White: Trade-Finance White Labels as Part of a Growth Strategy". jpmorganchase.com. http://www.jpmorganchase.com/cm/ContentServer?cid=1102380202104&pagename=jpmorgan%2Fts%2FTS_Content%2FGeneral&c=TS_Content. 
  2. ^ "Richelieu experiences hiring boom, starts expansion". WCFcourier.com, RC Balaban, August 27, 2006. http://wcfcourier.com/business/local/article_eb9bdbf5-8790-5071-9eab-2e82b2085f28.html. 
  3. ^ a b "There's new appetite for peddlers of cheap eats". Boston Business Journal, Feb 23, 2009, Lisa van der Pool. February 23, 2009. http://boston.bizjournals.com/boston/stories/2009/02/23/story1.html.