Go Your Own Way

Launching a private label line.
The pros and cons of private label skin care.

Retail skincare products offer several benefits to aesthetic patients and practices. They help patients protect the health of their skin and maintain the results of in-office treatments, while providing an additional source of ongoing revenue for the practice. The challenge is that with so many online and brick-and-mortar retailers offering high-end skin care, patients naturally shop for the best deals on their favorite brands. One way to both keep revenue within your business and ensure that patients are using products that offer the greatest benefits for their concerns is to carry a private label line. The process of launching your own skincare line may seem daunting, but it can be done at relatively low cost with a surprising amount of manufacturer support.

Pros and Cons

The No. 1 benefit of private labeling is exclusivity. “Patients can only purchase a private label product from the physician offering that line,” says John Kulesza, founder and president of Young Pharmaceuticals, a skincare company that offers both branded and private label products. Additional benefits include the ability to build your brand through your private label line and offer cost savings on high quality products.

Jessie Cheung, MD, of the Dupage Dermatology & Laser Center in Willowbrook, Illinois, chose to create a private label line for her practice because it allowed her to develop unique formulations that she believes in. “The products contain the exact ingredients I want, and it allows me pass the savings on to my clients,” she says. “In addition, these products can’t be price-shopped on the internet.”

Angelia Inscoe-Rankin, CEO of skincare manufacturer Induction Therapies, notes that because these lines are exclusive, physicians can set their own margins based on what their local markets will support, and the lines double as a marketing tool. “If a friend says my skin looks fantastic, I can give her my doctor’s information right off the bottle,” she says.

Private label products also increase loyalty and serve as an ongoing market piece for existing patients. “Every time the patient opens her medicine cabinet, she is reminded of your brand and your practice,” says Kulesza.

The flip side of exclusivity is consumer uncertainty: It’s natural for people to question something that’s new and potentially unproven. They may gravitate toward recognizable, branded lines rather than take a chance on an exclusive one. “When a product shows up in Allure magazine as a celebrity favorite or is featured on a morning show, patients are going to pay extra attention and come into the office seeking that product,” says Delaram Saidi, founder and principal of DS Group Consulting.
Branded product lines also offer a significant amount of marketing support to the practices that carry them, including product displays, testers, samples and marketing materials, as well as access to educators who will train staff on retail sales and individual product benefits and indications.

Therefore, it is crucial for practices considering private label to ask their suppliers what type of marketing and educational support is available and request ongoing training for staff, so they can educate patients on the active ingredients and help promote the in-office line, says Kulesza.

Many private label formulators have graphic designers on staff to help you develop your logo and offer collateral materials like sales sheets, shelf talkers and samples. “We also encourage practices to host an event and have either myself or one of my reps come in to help promote the new line,” says Inscoe-Rankin. “It’s the doctor’s line, and we are presented as the company that helped formulate it.”

In order to take advantage of the benefits offered by both private label and branded products, she recommends that practices carry one or two established name brand lines in addition to their own private products. “Because the patient trusts the name brand already, she will likely trust your line by association as well,” says Inscoe-Rankin.

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