What Is White Label Software? How It Works, and Is This the Right Path?
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The last few years have seen a rise in white-label software, especially in the Software as a Service (SaaS) sphere. The business opportunities offered by white-label platforms are considerable. Indeed, there are several excellent reasons for using white label software, which we’ll cover below. Before that, let’s all make sure we all understand what we mean by ‘what is white label software.
What Is White Label Software?
Put very simply, white label in this context refers to software created and developed by one company, that is leased out to another company. The key element here is that the originator of the software removes its own branding in order for the lessee company to put its own branding on there instead. The labeling, in other words, is ‘white’.
Intellectual rights over the software remain with the original developer, while the responsibility for marketing and sales passes to the company whose branding and trademark is now all over the product.
Clients will usually be unaware of the originator’s identity. It’s better this way: sometimes clients will attempt to secure the SaaS product from the developer rather than the retailer in order to secure a better price.
This maneuver is usually unwelcome from all kinds of perspectives, not least from that of the retailer. The originator will often not be geared up to sales so not great for them either.
Varieties of White Label
When you’re asking the question ‘what is white label software’ one should be aware that there are a number of different types. Let’s run through some.
SEO can be a bit of a drain on a company’s resources. This can especially be the case when the company is unfamiliar with the concept or they have an enormous body of clients that they simply don’t have the time to service.
The good news is that such a company can lease SEO software from a service provider that assists by giving website content optimization steers, plus additional services such as providing white label SEO analysis on the website’s performance.
Of course, as we’ve now seen, the company doing the supplying is probably not the company that did the development. Hence, the white label.
There’s been a huge growth in the number of mobile apps in recent years.
The good news for a company wanting to supply apps is it’s very simple to use a developer’s coding and insert one’s own branding into it.
In a very competitive app market, a startup won’t want to have to invest money and time in developing one that might be obsolete by the time it’s ready for use, after all the refinement and play store app testing that it will have to undergo. Much better to be able to use an established company’s expertise and take one of its successful products and make it seem like your own.
Social Media Management
This is a great example for those who ask what is white label software? Let’s say you’re a social media business owner and you want the benefits of great reporting that you can only get from another company. Moreover, you want to be able to send some of the report information out to your customers. In all likelihood, you will just want your branding on the report.
This is where white-label software is so useful.
Social media management solutions can also cover all communications, so you can stay on top of the traffic on your service, and interject messages where necessary, and all in the surrounds of your own branding.
It’s even possible to sub-let the system to another company and put their branding on it instead of either the originators or the suppliers.
In much the same manner as social media management, this software enables a marketing services company to provide all sorts of communication services to a customer, from ways to cope with high levels of traffic to a good sentiment analysis tool.
White labeling is performed in the usual fashion: all branding from the originator is removed and replaced either with the supplier’s or with the customer’s, as appropriate.
Benefits of White Label
There are many benefits of white label products. Let’s take six of them.
1. Development’s Expensive
With white label software, all you pay for is the license fee (usually on a monthly basis) for the finished product. However, if you’re developing a product from scratch, you have to be prepared to invest a great deal of money and time in something that might not actually work as well as you were hoping. And you’ve had to foot a substantial bill.
This graph shows the cost factor if you’re paying a developer. If, on the other hand, you have in-house expertise then you’ll enjoy a degree of cost-saving. However, a great deal of time will be spent on the project, which, by its nature, can often involve an element of working in silos, which is never to be desired.
2. Beat the Competition to Market
Depending on the complexity of the product, building it from scratch can take 8-9 months. Meanwhile, one of your competitors has taken the idea and run with it all the way to a white label software company and hit the market while you’re still awaiting developer progress reports.
By the time you’re ready with your brand new software, the party’s over: the rest of the world’s moved on.
3. Play to Your Strengths
There are currently 4.3 million software developers in the US. That’s pretty impressive. But there’s no rule that says you have to be one of them. Your strengths may lie in marketing, or sales, or just in making people feel good about themselves. All hugely valuable talents.
So, concentrate on those and leave the 4.3 million developers to do what they do best. And then use the fruit of their labors and pass it off as your own.
Should you wish to join that burgeoning bunch of developers, however, there are many tools to help you in this endeavor. The very best of luck to you.
4. Give Your Customers the Service They Need
By freeing yourself of the responsibility to oversee software development, you give yourself the ability to spend time with the customer.
In this way, you can expand and enhance your business’ services to accommodate the growing needs of your current customers. This is how to scale a partner program to give real benefit to your clientele. You’ll get lots of satisfied customers and customer loyalty will result.
You can factor these extra services into your white label software: one of the key characteristics of it is its flexibility and offering of custom features so it can take the shape that the leasing customer needs it to. Changes can be made to it quickly and simply, without the upheaval that would be the case with in-house software.
5. Acquire New Customers
The flexibility that white label software gives your business will enable you to market yourself to new market sectors. Such agility might not be possible with software that you have built from scratch as you may not have factored in such potential expansion.
6. Reduce Risk
If things aren’t working out for whatever reason, simply cancel the contract and walk away. Easy.
What to Look For
In order to give a white label relationship the best chance of succeeding, there are certain factors to observe.
Look for an organization with similar goals to your own. The white-label software developer will be a strategic partner, hopefully for some time to come. Make sure your visions have something in common. Otherwise, you may be in for conflict.
You want to be linking up with a solid performer, with a great reputation in terms of service and security. Yes, you can always decide to move on if things aren’t working out, but it’d be so much better if you can stay working in tandem with a quality partner.
So, check the reviews before you dive in. Ask the question: what is white label software to you? What are its benefits? Then see how they deliver. And look at how experienced they are in the business.
Always important, customer service. You’ll be dealing with software you know little about, so you need to know that when you need the developer’s help, they’re there for you. Often your customers’ support too will be supplied by the developer, so you need to be sure it’s of a high standard. If it’s not, your customers will hold you accountable.
Ensure that the terms of the contract make perfect sense and leave no room for confusion. If in doubt, get a wiser head to look at it with you.
You have to be given the opportunity to test it out. This is the only way to be sure that it’s right for you. So, whether you get a free trial or freemium, this should be an absolute dealbreaker.
What is white label software if not an established means of getting an excellent product or service and making it look like you came up with it? The white-label solution delivers substantial business benefits with relatively little commitment of time and expense. It’s what company directors dream of.
About the Writer
Grace Lau is the Director of Growth Content at Dialpad, an AI-powered cloud communication platform for better and easier team collaboration. She has over 10 years of experience in content writing and strategy. Currently, she is responsible for leading branded and editorial content strategies, and partnering with SEO and Ops teams to build and nurture content. Grace Lau also published articles for domains such as Tapfiliate and Easy Affiliate. Here is her LinkedIn.
Disclaimer: The author is completely responsible for the content of this article. The opinions expressed are their own and do not represent IEEE’s position nor that of the Computer Society nor its Leadership.