When it comes to e-commerce, the industry is booming. In 2022, the market is expected to reach over $5 trillion, and the number will only go up as time goes on. So, now is the perfect opportunity for entrepreneurs to get a piece of the pie.
While dropshipping is one of the most common options, private label branding is another viable solution for many online retailers. That said, because the market is so hot, competition is fierce. E-commerce stores have to compete against each other and big brands like Amazon and Wal-Mart. So, branding is crucial for companies if they want to get ahead.
With that in mind, let’s dive into the world of private label branding and how you can develop a rock-solid brand for your business.
What is Private Labelling?
One of the biggest challenges of running an e-commerce store is providing products to your customers. Even if you focus on a specific niche (i.e., dog toys), you want to have a substantial selection. Otherwise, your clients may decide to go to another site where the selection is bigger and more comprehensive.
Fortunately, online retailers don’t have to do the hard work of creating new products from scratch. Instead, they can work with manufacturers to sell products under their label. The manufacturer provides the finished pieces for the store to sell however it likes.
The best way to understand private labeling is to look at an example – Costco’s Kirkland Signature brand. As a big-box store, Costco doesn’t make its own products. However, Kirkland Signature is Costco’s in-house brand. The way this partnership works is that Costco has agreements with other manufacturers to sell their products under the Kirkland label. As far as customers are concerned, Kirkland is a unique entity, even if the products are identical to other brands.
As an e-commerce store, you can do the same thing with private labeling. However, this process is different than white-label branding. With a white-label brand, other retailers can sell the same product under their unique logo. With private labeling, you establish a contract with the manufacturer directly. In this case, you have exclusive rights to sell the item under your brand name.
How to Build Your Private Label Brand
Since branding is such a crucial component of success, it’s vital to understand the various steps to building awareness of your products and company. Keep in mind that this article will only focus on the branding element of private labeling. By this point, you should already have your business model in place and be ready to sell your products.
So, let’s see what it takes to get a private label brand off the ground.
Find a Reliable Manufacturer
The success of your e-commerce company depends on your products more than anything else. Even if you have the best branding in the world, it won’t mean much if customers don’t like what you have to sell. So, it’s imperative to find a reliable manufacturer that can deliver high-quality merchandise with each order.
If you use a subpar manufacturer, your brand will suffer the consequences. The issues that can stem from problematic companies include:
- Shipping Delays – Customers won’t get their order on time, making it hard to get repeat business.
- Damaged or Missing Components – Unreliable manufacturers will repackage used products and send them out without any quality control.
- Knock-Off Products – Your brand means something, so you need to ensure that your product quality stays consistent. Poor manufacturers may use knock-off materials or designs, leading to shoddy craftsmanship.
So, when it comes to branding your private label store, you need to do your due diligence when sourcing your products. Here are five elements to look for when choosing the right manufacturer:
- Specialization – One of the best ways to stand out in a competitive field is finding a niche and focusing your attention on a specific demographic. So, you need a manufacturer that reflects that kind of specialization. For example, if you’re selling dog toys, you don’t want to work with a company that produces appliances. Even if they can offer dog toy products, they’re likely not very good.
- Customer and Client Reviews – Pay attention to what customers are saying about products from the manufacturer. If you see complaints about missing or damaged merchandise, you should keep looking. Also, look at what other private label brands say about the company. Does the manufacturer provide high-quality products on time, or are there consistent issues?
- Delivery Times – We live in an on-demand age, so customers expect packages to arrive quickly and in pristine condition. Remember, if you can’t deliver orders promptly, there’s no reason why a customer can’t go to Amazon or Wal-Mart instead. Ask your manufacturer about delivery times and how they address potential delays.
- Pricing – As a new private label brand, you won’t be able to negotiate rock-bottom prices the same way that massive companies like Target or Wal-Mart can. However, don’t assume that the price you see is the only one available. Compare different companies and be open about your plans for the future. For example, perhaps you could get discounted rates based on sales numbers or if you enter a long-term contract.
- Few Defects and Errors – All products can experience defects while on the assembly line – it’s part of the manufacturing process. The main question is to find out what the company does to reduce defective items and how they address issues if discovered after the fact. For example, if a product turns out to be a safety hazard, how does the manufacturer handle recalls and replacements?
Decide on a Brand Name
With thousands of e-commerce stores out there, it’s challenging to stand out from the crowd. One of the crucial elements that will help your company differentiate itself is the name. If your brand name is too generic, it can be hard to remember. But, if it’s too long or complicated, you run into a similar problem. So, the key is to create a name that straddles the line in the middle.
Here are a few tips on how to come up with a winning brand name for your private label business:
- Use a Name Generator – There are several business name generators available for free online. While these programs won’t always work, they can inspire you. Even if you don’t wind up using one of the hundreds of names the generator spits out, you might find an idea worth pursuing. Just make sure your keywords are related to what you sell.
- Keep it Simple – Think of the biggest brands in the world right now. Names like Apple, Netflix, Microsoft, and Uber come to mind. While that’s not to say a longer name won’t be successful, it seems that shorter is often better. That said, you’ll also notice that each name is unique. Again, you need to straddle the line between memorable and simple so that customers can recall your brand later on.
- See How It Looks – A name can sound appealing at first, but once you put it in a logo or a font, it might look completely different. As we’ll discuss in the next section, your brand logo can make or break your business. So, once you come up with a few names, see how they feel in various fonts and colors. Doing this will help you pick a name that’s easy to remember and will look good on a website.
- Consider Your Domain – As an e-commerce store, your products will live online. So, whatever name you choose, you’ll need a matching domain URL. Ideally, you can come up with something unique that hasn’t been claimed already. However, if your preferred domain is taken, you’ll need to figure out how to customize your URL.
Create a Logo
Just as your brand name helps set you apart from other businesses, your logo will do the same. Realistically, you should work on both pieces simultaneously so that you can check off both boxes at the same time. Just as with your brand name, your logo needs to straddle the line between simple enough to work on various marketing materials and memorable enough to stand out from the crowd. Again, brands like Amazon, Apple, and Netflix have super streamlined logos that work well in various mediums.
Here are some ways to craft the perfect logo for your private label business:
- Use a Logo Maker – Logo makers are a super quick way to make a logo and they are also super affordable. The ones that use AI are the best – simply add your brand name and include some design preference and the logo maker create an appropriate design.
- Find a Freelance Graphic Designer – Sites like Upwork are great for sourcing graphic design professionals. You can browse tons of profiles and portfolios to find a designer that fits your aesthetic. Just make sure that you have a decent budget for a logo. Never expect a designer to work for free.
- Research the Competition – As we mentioned, an easy way to stand out in e-commerce is to focus on a niche. So, you should look at other digital storefronts that sell similar products. Pick a few logos you like and figure out what makes them work. From there, you can use your inspiration to determine your logo type (i.e., text-based or graphics-based), coloring, and font choice.
Design Your Packaging
If you haven’t sold products before, you may not realize how much of an impact packaging can have on the consumer mindset. In many cases, customers will choose a product based on how it looks and feels, not necessarily what’s inside. The psychology of branding and packaging is the primary reason why Hydrox is considered a knock-off of Oreo. However, the reality is vice versa, which is pretty mind-blowing when you think about it.
Package design can be a lengthy process, particularly if you don’t have the tools to do it yourself. If you can’t produce your own packages, you should find a manufacturer that can add your branding to their existing materials. Here are some tips on compelling package design:
- Use Materials That Reflect Your Brand Identity – If your mission statement is to provide natural, organic ingredients to your customers, you’ll seem disingenuous if you use thick plastic packaging. Choose materials that correspond with your branding so there’s no disconnect when customers receive their order.
- Consider Product Shapes – Realistically, your products won’t all be in square boxes. So, you have to think about how your design will look on a unique shape (e.g., bags, cans, cylinders, etc.). If possible, look at mockup images to ensure that your spacing is correct. You want to avoid designs that get cut off or are hard to read once printed.
- Think About Regulations – Your products may have to follow various rules and regulations, especially if selling across state and country lines. For example, if you’re selling food, you need to provide nutritional information. You may also have to give a point of origin. Consider how these elements will affect your overall design.
- Be Consistent With Marketing Materials – If your ads use earthy colors (blue, green, brown), your packaging should too. Overall, you should have a brand color palette to use across platforms and channels, including your website, social media profiles, and products.
Set-Up Your Online Brand Assets
As an e-commerce business, digital marketing assets will be crucial for building brand awareness. Now that you have a name, logo, and package design, you should focus your attention on building out the rest of your materials, such as:
- Website – The primary page layouts to develop are the home page, about us page, and product listings. Be sure to use proprietary images of your branded products, ideally in-use. When building a website, simplicity and practicality are essential. Customers should know how to purchase an item and check out instantly. If they have to scroll or browse too much, they’ll bounce to a competitor in no time.
- Social Media Profiles – As we mentioned, consistency is critical when branding your business. Come up with brand style guidelines and ensure that all your profiles and posts fit within those parameters. As your company grows, these guidelines ensure that everyone is on the same page, including your marketing and sales teams.
- Inbound Content – One of the best ways to build brand awareness is to create high-quality content that appeals to your core demographic. You can set up a blog on your website and promote articles, infographics, and video content across your marketing channels. Be sure to focus on informative and authoritative material that shows your customers why you’re the best e-commerce retailer within your niche.
Protect Your IP
One of the primary benefits of running a private label business is having an exclusive contract with your manufacturer. However, plenty of companies out there have no issues with knocking off both your brand and your products. So, it’s imperative to establish a trademark to protect your business from intellectual theft.
The trademark process is pretty straightforward. You will need to submit an application to the US Patent and Trademark Office to make your trademark official. Doing this ensures you have legal protection if anyone tries to copy your brand identity.
While filing for a trademark can be time-consuming, it’s worth the investment. Without an official trademark, another company could potentially create a similar brand identity and trademark it. In a worst-case scenario, your business may be considered the knock-off, even if you were first. In that situation, you might have to erase your branding and start over from scratch.
Provide Amazing Brand Support
One challenge of running an e-commerce store is that you can’t interact with customers face-to-face. So, you have to go above and beyond in providing excellent customer service online. Fortunately, technology makes it easy to engage with your clientele using these elements:
- Chatbots – Bots allow you to be responsive and engaging 24 hours a day. You can program bots to answer simple questions, provide more information, and connect a customer with a live support agent.
- Multi-Channel Communication – These days, consumers want more options to get a hold of an online business. So, you should offer a phone number, text number, email address, and instant messaging system. The more channels available, the easier it is to address complaints and questions.
- Tutorials and Forums – If most of your customers have the same questions about your products, you can address these concerns with premade content. Examples can include a FAQ page, video tutorials, and online forums where people can get answers from other users. This way, you can reduce your need for extra labor.
- Customer Relationship Management (CRM) Software – For those times when a live person helps a customer, they should be able to pull up tons of data about the person immediately. For example, what products the customer purchased, who they talked to during their last interaction, and more. CRM software empowers your support staff to engage with clients more effectively, which can help foster better brand loyalty.
Now that you have the tools and the insight to create a high-quality private label brand, success is only a matter of time. Overall, the more time, effort, and resources you invest in branding, the easier it is to build a loyal and long-lasting audience.