Private Label Beauty Products Becoming Big Business

Peter Chalmers comments on why it’s an opportune time to be in the private label product-manufacturing sector.

By Peter Chalmers

Private label products are making major gains across many consumer goods segments, including beauty products. The sluggish economy has played a role in the growth of private label products because consumers are seeking bargains and are using store brands more often.

But that’s only part of the story: Private label products are now used in well over a quarter of U.S. households—up sharply from 18% in 2000—not only because buyers associate them with low prices but because retail chains and manufacturers are using more advanced private label marketing strategies.

Advanced Label Technology

Private label products are generally less expensive than their brand-name counterparts because they are produced and marketed without large advertising campaigns. In the past, beauty product manufacturers producing private label goods would need to arrange costly professional digital printing services to create labels with visual appeal to match that of national brands.

However, technology advances have made it possible for manufacturers to produce in-house labels with incredible quality on a variety of label materials and sizes. Manufacturers can now find affordable printers that allow them to create labels in-house for label runs of any size, enabling them to save thousands on printing costs.

In-house label solutions can also enable beauty product manufacturers who use seasonal ingredients and create small batches to affordably print custom labels. Local products are a major trend and short-run label production capabilities can help beauty product manufacturers meet the growing appetite for local goods.

Will Growth Continue?

Private label products now claim a greater share of the typical consumer’s cabinet space, but will the trend continue? There are at least three reasons to believe it will:

  • Private label brands are increasingly popular in retail chains: Grocery chains and other retailers are using private label brands to compete head-to-head with brand-name goods and grow customer loyalty. Examples include health and beauty products like private label nail polish remover, cotton balls and much more.
  • A long economic downturn has consumers seeking bargains: The current economic downturn is one of the longest in living memory. Bargain-hunting has become a way of life for many consumers, and private label product sales have benefited.
  • Label-making capabilities enable private label products to compete with brand-name goods: Because manufacturers can now affordably create custom, high-quality labels in-house in whatever quantity they require, they can move goods to market faster and grow profits.

For these reasons and more, this is a good time to be in the private label product-manufacturing sector. It’s a bright spot in an otherwise challenging market.

About the Author: Peter Chalmers is product manager at specialty printing equipment manufacturer, Primera Technology, which serves a variety of clients, including leading beauty product manufacturers, worldwide.