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View Full Version : Let's Get Serious About Local Advertising


AdWatcher-Boris
03-24-2005, 01:00 AM
Greetings,

Targeting the local market for hosting companies is nothing new. In fact, we have these kind of threads on WHT every week or so. I figured it might be an interesting idea to combine and discuss some new ideas on local marketing alone. If this sounds like it's been covered before - it probably has been. However, I hope that we might be able to get some new thoughts flowing in this thread.

While we don't run a hosting company per se, we do target the same market - small to mid-size businesses (preferably with existing websites) and have been involved in the hosting industry for years.

To start off the thread, I’d like to introduce some of the ideas that we’re implementing ourselves:

1) Radio Advertising – there a nice list of business-related radio stations in US in a Yahoo Directory (http://dir.yahoo.com/news_and_media/radio/programs/business_and_economy/?o=a).

There is a specific one that caught my attention: http://businesstalkradio.net.

After getting in touch with them, I found out that the rates range from $200 to $300 per a 60-second slot during, what I think is the best time, commuter timeframe (6am-12pm; 4pm-8pm). Now, there are two things that are pretty attractive about their station:

a) They do the commercial for free – you just send them the text and they take care of the rest.
b) If they are interested in your industry, you might be able to get a 4-5 minute interview out of them. They do charge you for that (around $500), but a 5 minute interview with you on the air can be VERY effective, in my opinion.

I believe that the most effective thing to do would be to run two commercials per day (preferably during the same show) for about 5 days (Mon-Fri). This will get you exposed to the regular listeners at least a couple of times.

Keep in mind, that one week is simply meant to gauge the approximate response. A week isn’t really enough for a successful radio campaign, but it will show you if there is any potential. Something like this would wind up costing you around $2,000-$3,000 depending on the frequency and timeslots

We’ll be starting our own radio ad campaign in April, so I’ll keep you posted on the results.

2) It seems to me that the best way to reach out to the local business community is through educating them first and selling later. In the summer, we are organizing to hold several live workshops in the New York area on online advertising (the industry we’re in) for small businesses.

The way we plan to do this is by:

We plan to limit the attendance to up to 30-50 people per session and hold around 4 sessions in one week (2 on a weekend day and 2 on two weekdays). The reason why we want to keep the attendance low is so that business owners would feel more involved and would get more out of this.

Where to hold the workshop? You can try the following ideas:

a) Approaching local colleges about renting a classroom or an auditorium. Most of them are usually well-equipped with computer stations and projectors, if you need them.
b) Approaching local hotels about renting a conference hall.
c) If you have an office with a large enough conference room, you might be able to host it right there.

In terms of marketing, you can do it either through:

a) Purchasing leads of businesses in the local area through something like infousa.com and sending them postcards informing them of the event. This would be the a somewhat expensive solution due to the low response rates and high cost of printing and postage.

b) Advertising the event on the radio (if you have a business related station in your area) - also will be somewhat expensive, but will reach a broader audience at a lower cost than postcards.

c) Advertising the event in your local Chamber of Commerce – rules and regulations on that vary, so you’ll need to do your own research on that.

Keep in mind that you can hold more than 4 workshops and you can accept more than 30-50 people per session.

I think that it would be an excellent thing to do on a regular basis as the word would eventually spread and if you’re the first company doing this in your town, you might be able to get free publicity from the local media.

Of course, this won’t work for those offering $2.99/mo plans, but should work out well for companies who want to target the local market and charge $30-60/mo per hosting account), as well as offer additional services (ranging from design to marketing solutions and so on)

3) Quarterly Newsletter – in previous WHT threads, postcards are often brought up as effective means of reaching out to the local clientele.

However, I think that a more effective way of getting your company known and respected in your area can be achieved by sending out a quarterly newsletter (physical snail-mail newsletter, not eMail) to local businesses filled with information, tips, ideas, etc. on getting the most out of their existing (or potential) Internet presence?

One way to go about it would be to:

1) Purchase a list of leads of local businesses (or gather them up yourself)
2) Hire a freelance writer through guru.com or any other source that will either write or assist you with writing the newsletter on a regular basis. Keep in mind, it doesn’t need to be large – a couple of pages should suffice.
3) Get in touch with a local printer to see what kind of options they have in terms of printing and mailing.
4) If you choose to mail yourself, make sure to get a permit from a post office – that will save you a whole bunch of money and will make it easier for you (no stamps)
5) … and send out the newsletter on a regular, consistent schedule.

Now, something that I do want to stress in this is that you shouldn’t sell and push your services on every single page. It really shows and has a damaging affect on your credibility. There is nothing wrong with mentioning your company and what you offer clearly – but don’t overdo it.

By the way, if you do decide to do the newsletter, it can serve as excellent means of promoting your workshops, as you’ll already have an audience that knows and respects you.

I’ll wrap it up for the night. I hope you found this at least somewhat useful and we will get more responses, suggestions, and comments in this thread.

Boris

cnm72
03-24-2005, 02:45 AM
wow Boris... thank you for investing the time to write this

I think your physical newsletter idea is great... hmmmmm

amps
03-24-2005, 11:34 AM
One thing you'd have to be ready to do after running radio spots is answer the relentless phonecalls (you better have a phone number they can reach) and explain to people why you can't meet them in your office (that is if you don't have one, like most smaller hosting startups).

AdWatcher-Boris
03-24-2005, 11:41 AM
amps, that's a valid concern - however, you could offer to visit them instead? I think they'd appreciate the length you'd go to to make the visit too.

However, in general, if you want to go after the local market, an office is somewhat necessary.

Boris

gghosting
03-24-2005, 02:30 PM
Thanks for the ideas Boris. Your newsletter idea is a good idea and I might look into doing that.

cahostnet
03-25-2005, 12:59 PM
Boris, this is all good stuff. It's nice to see someone else on this thread understand business!!! (I know allot do). I also wanted to say I agree with you 100% on educate first and sell later concept. In fact I agree so much that we're redoing our web site so that this concept is carried over to the site. I think one of the mistakes done by most is to assume everyone is the same (listing features on site that doesn't mean anything to anyone). We are also guilty at this a bit. I think if you educate a customer and they don't buy immediately they will still come back to you and buy later. This takes time though. You really need to understand your customers.

Having a project management background as well as business background I can tell you that no user is going to buy services from you or anyone else if they don't even know what they want. Also shoffin order now down their throat is a big turn off. Always provide learn more buttons.

The newsletter is a great idea; every marketing person will tell you to do this. It's the best way to establish yourself as a subject matter expert; once you do this people will be willing to purchase your services. This is how people think and that's why this type of marketing technique works. You don't even have to do this on a monthly basis. Another idea is to find another newsletter and offer to contribute some articles; this way the cost isn't on you or you only.

I've also thought about online seminars but this can be a bit costly. However, if you can even team up with some other businesses in your area you can do this. You can get a web designer, a host and other internet expertise and put together a seminar. You can do this online or locally in an office like you said.

Well all of this is great; now the time!!! Just to note, you don't have to do everything all at once. Pick one and do it and do it well.

IMeanWebHosting
03-25-2005, 04:48 PM
Just out of curiousity... how in the world do you get people to pay $30-$60 for a hosting account? :eek:

Anky
03-25-2005, 05:01 PM
Originally posted by Bohica
Just out of curiousity... how in the world do you get people to pay $30-$60 for a hosting account? :eek:

Prove to them it's worth it. Targeting online, customers know what it costs and want to pay near that, not near what it's worth. You have to factor in your time, quality of service, perceived value, etc.

AdWatcher-Boris
03-25-2005, 05:43 PM
There are a number of ways:

1) First of all, most people aren't as technically advanced as we are and don't really know or want to use the budget hosts.

2) Many people perceive price connected to quality. Higher price, better quality.

3) Businesses prefer to pay more because they prefer to work with local businesses, instead of an unknown entity int he cyberspace.

Boris

Haddy
03-25-2005, 06:30 PM
Remeber if people perceive the value they will expect it to be ture. Dont offer the same account / service @ $50/month that you normally run @ $5 / month.

Rackspace is a prime example. How do they get people to pay $400+ /month for just 100GB of transfer? Quality of service plain and simple. Not many companies give you a set (not just one) of named techs that you can call whenever.

I dont have a physical office outside of my home so I just downplay that telling them I offer onsite service. Just take my laptop and blackberry and its just like being at home anyway. Most people dont understand how much customers appriciate having someone by their side setting up their email account, ftp access, ect.. nor do they realise how much they will pay for this service.

cahostnet
03-25-2005, 06:50 PM
Exactly, SERVICE, SERVICE and SERVICE

eservicesu
03-26-2005, 01:42 AM
The only problem with charging higher prices to local customers is the simple fact that if they visit your web site and see cheaper prices, they might be a little ticked off. We all know online, you cant exactly charge 50$ for a standard hosting account (mid to high end yes) because you want to compete with the other hosts out there.

Locally, theres a good chance you can charge that much, but then if they see your web site with cheaper there going to be mad or think your lying to them to get extra money.

Hope you gets catch my idea here. Not to toss a wrench into your post there Brois, great ideas. Im planning on doing a local news letter my self.

- Eddy

AdWatcher-Boris
03-26-2005, 03:09 AM
Eddy,

Thanks for the input.

I have to disagree on this one - you are not lying to anyone by charging reasonable prices. Who's to say how much is an "honest" figure? Just because 95% of the other hosts charge $7.95/mo, doesn't really mean that if you charge $50/mo for the same features, you're lying. Maybe you put less clients per server... maybe you spend more one-on-one time with each client... it's your business and nobody has the right to say how much you need to charge. It's what the market is willing to pay that matters.

Boris

Kiamori
03-26-2005, 03:22 AM
Originally posted by sirgamesalot
The only problem with charging higher prices to local customers is the simple fact that if they visit your web site and see cheaper prices, they might be a little ticked off. We all know online, you cant exactly charge 50$ for a standard hosting account (mid to high end yes) because you want to compete with the other hosts out there.

Locally, theres a good chance you can charge that much, but then if they see your web site with cheaper there going to be mad or think your lying to them to get extra money.

Hope you gets catch my idea here. Not to toss a wrench into your post there Brois, great ideas. Im planning on doing a local news letter my self.

- Eddy

You should have different plans some including enhanced support, 24/7, and some included development if you have an in house design team. Add-ons also work in the same manner. You have to remember how much time is worth for your clients. Having bad support is not in there best interest when they waist an hour listening to elevator music with (insert cheap hosting company here) they are losing all the money they could have been making with a client. Many professionals make around $150/hour. How much does that make good service worth?

I've found asking the client what type of support they expect after they are sold and creating a custom plan for that client works the best. Have a good range of service options to show the client what you have to offer is a must.

Roy@ENHOST
03-26-2005, 05:12 AM
I've been doing that since 2002 for local customers.
A lot of people on WHT are used to ....well....the WHT crowd

You have no idea how much local businessmen are willing to pay you (10-50 times what the budget hosts are offering ) just because you show up at their office and prove to them that you are a for real.
A good presentation also helps.
I have a Flash presentation stored on my flashy Fujitsu notebook just for that purpose.
And also the conversion ratio is way better offline.
I close more than 50% of the clients I visited.
You will be lucky if you have a 1% conversion rate online.

Also I wanna add that local customers are way more loyal.
They are also more likely to refer you through word of mouth, thats my observation.

Originally posted by Bohica
Just out of curiousity... how in the world do you get people to pay $30-$60 for a hosting account? :eek:

Haddy
03-26-2005, 01:58 PM
Originally posted by Roy@ENHOST
And also the conversion ratio is way better offline.
I close more than 50% of the clients I visited.
You will be lucky if you have a 1% conversion rate online. I take it those are warm visits not just cold calls?

Anky
03-26-2005, 01:59 PM
Roy@ENHOST, how did you approach local customers when you first started?

About a year ago I went around to some shops with VERY little planned and most thought I was a door to door salesman or was soliciting. I couldn't even discuss a website with any, I just had to walk in and then walk out soon after.

I learned a lot from that experience and want to change things now, what would you reccomend I do?

Kiamori
03-26-2005, 03:24 PM
Originally posted by Roy@ENHOST

And also the conversion ratio is way better offline.
I close more than 50% of the clients I visited.
You will be lucky if you have a 1% conversion rate online.


That is very impressive... At my best I was near 20-25% and I thought that was good. My current sales team has about 15% conversion rate.

Are you looking for a job? :)

cahostnet
03-26-2005, 04:21 PM
You shouldn't run your business based on someone else's price. You run your business based on your service and the cost of you doing business. I don't care if someone sells hosting for $2 a month; let them. What I need to do is to proof to my customers why they should pay $15 a month for mine. Once you do the comparison and sho them what they get it will be clear to them.

Roy@ENHOST
03-26-2005, 07:44 PM
Thanks for the offer but I am happy with my current "job". :D

Take note that Web hosting is not the main item.
I offer web design + programming. Web hosting is a tag-along item.
And for some reason I only have requests from serious people locally.
When they call, they are pretty much half sold.

And following up is SUPER important.
If they said that they will think about it and get back to me, I will get back to them in 1 month, 3 months and so on....
This make sure that I will be on top of their list if they should need a web design / programming work done.
It also helps that the designers in my community suck to the core ,charging way more for a site that looks like it was slapped together by high school kid on frontpage.

Originally posted by Kiamori
That is very impressive... At my best I was near 20-25% and I thought that was good. My current sales team has about 15% conversion rate.

Are you looking for a job? :)

gghosting
03-26-2005, 08:29 PM
In the local market it's much easier to charge $50 for a web hosting plan a month. First of all most of the people that you will do websites for don't know a lot about web hosting and so they don't know to look up for budget web hosts charging $5 a month for a web hosting price.

Picture it this way: Suppose you bring your car in to the LOCAL auto repair center and the person tells you that it will be $100 to fix your car. Sure you might be able to save $10 or $20 elsewhere but you know the people and you know that they are local to you and if you have any problems you can just go there.

With hosting it's the same. The customer might just want to pay the extra $45 because they know that you offer service and you can help them whenever they need it. They can contact you and know where you are. $50 a month may still seem like a cheap price to get on the internet. I know talking with local clients where I live in Pennsylvania they told me that they planned on a domain name alone costing around $100.

Just offer the personal touch to your clients and give them support and service and they won't mind paying $50 for web hosting.

IMeanWebHosting
03-27-2005, 10:23 AM
Hehehehe. A domain name costing $100. :)

Anyways, I am debating opening a second site for "local users" with these fancy $50 a month prices, that way I can still have my $4 a month hosting work online. Anybody tried that?

Anky
03-27-2005, 10:55 AM
Originally posted by Bohica
Hehehehe. A domain name costing $100. :)

Anyways, I am debating opening a second site for "local users" with these fancy $50 a month prices, that way I can still have my $4 a month hosting work online. Anybody tried that?

I will be, but don't look at it as outrageous prices for what still costs you a little amount. With local hosting you need to work much more closely with your customer, maintain relations over time, etc. Online hosting is very impersonal, which is probably one reason we can't charge the same rates as easily.

gghosting
03-27-2005, 11:57 AM
Originally posted by AgaBoogaBoo
I will be, but don't look at it as outrageous prices for what still costs you a little amount. With local hosting you need to work much more closely with your customer, maintain relations over time, etc. Online hosting is very impersonal, which is probably one reason we can't charge the same rates as easily.

Do you really think that it is harder working local then with online? Online I think usually takes up more support and you always get those 500 trouble tickets when the server goes down for 3 minutes.

I think local is much easier to maintain and run. Which is why we are thinking if we should just go local and not run online ads anymore.

Haddy
03-27-2005, 02:05 PM
Originally posted by gghosting
Do you really think that it is harder working local then with online? Online I think usually takes up more support and you always get those 500 trouble tickets when the server goes down for 3 minutes.

I think local is much easier to maintain and run. Which is why we are thinking if we should just go local and not run online ads anymore. Any time when you can have 1/3 if not 1/4 the customer base it will be easier to maintain. On the other hand if someone is paying $50/month for an account and it's for their business / crucial to their business any unscheduled downtime is pretty much unacceptable to them, and should be to you as well.

Support tends to be alot more personal like said. I can almost always tell which of my customers is on the phone from the sound of their voice. I added a section in ACT where I can put personal info that I can make small talk with. I try to make small talk if I can while Im solving the issue / request.

I even have some clients who have needed onsite support where they call and schedule an appointment and Ill come to their home / office and fix an issue right infront of them, if they cant get it through the phone / online tutorials (note: this is only avalible on my top teir plans, but can be purchased for $50/hr).

Customers get a short survey + thank you card + maybe a small gift after their first month and every 6 months after that asking how we are doing, what we can do to make their experience better, ect..

I may go to extremes but my customers are always telling me about companies offering in the cheaper hosting, but then they ask about onsite support and uptime guaranteed with money (50% after 15 mins of downtime, 100% after 30mins) and how most hosts just go "well we dont offer that.......but our plans are cheaper!!"

Bill-zilonhost
03-27-2005, 02:20 PM
I found a cost effective way of doing print advertising is in church newsletters and school newspapers.

gghosting
03-27-2005, 02:26 PM
We advertised in a school newspaper. It's was real cheap for the ad but we got no customers. No phone calls or no e-mails even.

Bill-zilonhost
03-27-2005, 02:39 PM
Originally posted by gghosting
We advertised in a school newspaper. It's was real cheap for the ad but we got no customers. No phone calls or no e-mails even.
We got a great response.

gghosting
03-27-2005, 02:43 PM
Really? From students or from who?

Bill-zilonhost
03-27-2005, 02:53 PM
Students mostly but a teacher or 2 as well...

gghosting
03-27-2005, 02:59 PM
This was for web hosting or web design?

Bill-zilonhost
03-27-2005, 03:05 PM
It was for website hosting.

Kiamori
03-27-2005, 04:54 PM
Originally posted by Roy@ENHOST
Thanks for the offer but I am happy with my current "job". :D

Take note that Web hosting is not the main item.
I offer web design + programming. Web hosting is a tag-along item.
And for some reason I only have requests from serious people locally.
When they call, they are pretty much half sold.

And following up is SUPER important.
If they said that they will think about it and get back to me, I will get back to them in 1 month, 3 months and so on....
This make sure that I will be on top of their list if they should need a web design / programming work done.
It also helps that the designers in my community suck to the core ,charging way more for a site that looks like it was slapped together by high school kid on frontpage.

Ah, I was talking about cold sales not leads, that is more realistic.. 50% on cold leads would be amazing results. We also market design/development services along side our hosting.

I see lots of those, "I built this in ms word isn't it great?" while you think of the best way to tell them that it's hurting there business not helping it.

AdWatcher-Boris
03-30-2005, 12:58 AM
Any other ideas/suggestions on local promotion?

Boris

nuthin
03-30-2005, 04:40 AM
I know we hate them, but telemarketers seem to work well for some local businesses in my area that are in the hosting/development/marketing field.

Telemarketer gets the leads, sets a time to meet the potential client and a sales person visits them.

Depends if you really want to get into telemarketing or are able to. If your no good at sales, I would consider employing someone who is and offer some sort of commission setup.

iCeW1nD
04-06-2005, 05:01 PM
Great job on the article, learned me a lot!