Hi everyone,

I have a question that I need answered by people who have been in the business. In my local area there are plenty of small businesses and apartments and such who are paying $100 a year for very insignificant hosting portions. I am meaning 100mb of space for $100 a year. Would it be unethical for me to approach these businesses and ask them if they would be willing to switch to a cheaper host? Essentially poaching customers from this other place. On one hand I will be saving these businesses money, but on the other hand I am just stealing customers. What do I do?

mYrDoG

There's no such thing as "stealing" customers if they are willing to switch to your service. Just go for it. The hard part will be in convincing them to switch.

:peace:

--Adrian

That might be the case. Hopefully it won't be too difficult though. Right now I am still stuck on creating ToS and all of that magical funness. I also gotta figure out if I have to incorperate, if I have to charge sales tax, etc.

Hi everyone,

I have a question that I need answered by people who have been in the business. In my local area there are plenty of small businesses and apartments and such who are paying $100 a year for very insignificant hosting portions. I am meaning 100mb of space for $100 a year. Would it be unethical for me to approach these businesses and ask them if they would be willing to switch to a cheaper host? Essentially poaching customers from this other place. On one hand I will be saving these businesses money, but on the other hand I am just stealing customers. What do I do?

mYrDoG

Not at all. That's called SALES.

Yep, this isn't an ethics issue. At most it is a manners issue. Be polite, but embrace that you do have the right to advertise your business.

Here's a thought though... why cut your own throat (reduce your profits) by focussing on "cheaper?" Why not shoot for an equal price by simply offering more benefits for their money? Shoot for the upsell by piking a a unique product/service your competition does not offer? Often the unique product/service is "nothing special" to we geeks but it is a real charmer for laypeople... keep your target audience's view of things in mind and find that extra-value service/product that really tickles their fancy.

A business which competes on price is destined to fail, or to suffer a life of mediocrity at best. Businesses which compete on value are the ones that succeed and flourish. Embrace a winning strategy, instead of a model that focusses on making less money.

:D Bailey

Very well said bithost!

This is not at all unethical, as long as you are not slanderous about the other company. You are merely approaching trying to sell your product, legal, ethical and necessary.

Yep, this isn't an ethics issue. At most it is a manners issue. Be polite, but embrace that you do have the right to advertise your business.

Here's a thought though... why cut your own throat (reduce your profits) by focussing on "cheaper?" Why not shoot for an equal price by simply offering more benefits for their money? Shoot for the upsell by piking a a unique product/service your competition does not offer? Often the unique product/service is "nothing special" to we geeks but it is a real charmer for laypeople... keep your target audience's view of things in mind and find that extra-value service/product that really tickles their fancy.

A business which competes on price is destined to fail, or to suffer a life of mediocrity at best. Businesses which compete on value are the ones that succeed and flourish. Embrace a winning strategy, instead of a model that focusses on making less money.

:D Bailey

Very sound advice. Could you share some examples value added products/services for a couple of different target audiences (i.e. SMB, end users, etc.) The perception of value is just as important as actual value in the customers view, and that perception is likely to be quite different depending on the audience.

David

Yes, it does not seems unethical from any angle, however it all depends upon your relationship and convincing skills to convert them to switch to your service.

Yep, this isn't an ethics issue. At most it is a manners issue. Be polite, but embrace that you do have the right to advertise your business.

Here's a thought though... why cut your own throat (reduce your profits) by focussing on "cheaper?" Why not shoot for an equal price by simply offering more benefits for their money? Shoot for the upsell by piking a a unique product/service your competition does not offer? Often the unique product/service is "nothing special" to we geeks but it is a real charmer for laypeople... keep your target audience's view of things in mind and find that extra-value service/product that really tickles their fancy.

A business which competes on price is destined to fail, or to suffer a life of mediocrity at best. Businesses which compete on value are the ones that succeed and flourish. Embrace a winning strategy, instead of a model that focusses on making less money.

:D Bailey

Very nice reply! But the issue is that alot of these places are somewhat static sites. They might see 1 or 2 updates in the run of the year. I don't see how a feature other than a lower price is going to make this campground change their host. Do they really care about a mySQL database? uhhhh probably not, but I think it could work for some. It is the static people that will cause the problem.

Most people love to overestimate their needs. If the host they are currently with is offering 10 POP3 email inboxes - why not offer them 20-50 and market it as "we have same price as your current host but with more features so you have room to grow as well" :)

That might be the case. Hopefully it won't be too difficult though. Right now I am still stuck on creating ToS and all of that magical funness. I also gotta figure out if I have to incorperate, if I have to charge sales tax, etc.

Check www.hostlegal.com for pre-built ToS and other legal documents.

Save the customers money. Also make sure it seems that theres no work required. Tell them that you will transfer their sites for free (which you should) and there should be no problems.

hmmmm Does anyone know of anything other than hostlegal.com? I wasn't looking to pay for the documents if I didn't have to.

hmmmm Does anyone know of anything other than hostlegal.com? I wasn't looking to pay for the documents if I didn't have to.

HostLegal's documents are already checked by a lawyer, if I remember correctly. Unless you want to pay double for a lawyer to draw up your own ToS. Remember, you'll have to have a ToS you've created checked by a lawyer first anyway, it'd be cheaper to go with HostLegal.

Very nice reply! But the issue is that alot of these places are somewhat static sites. They might see 1 or 2 updates in the run of the year. I don't see how a feature other than a lower price is going to make this campground change their host. Do they really care about a mySQL database? uhhhh probably not, but I think it could work for some. It is the static people that will cause the problem.


Heh, you are confusing "features" with "benefits."

Features have no meaning to a layperson. Benefits are what make the sale. I'm saying to sell BENEFITS to clients, not features. Features won't do squat for sales, especially with non-techy customers.

Let's talk examples.

A bouquet of flowers for your girl. "A dozen roses" is a feature -- 12 flowers, species rose. Yawn. "The large lipstick red fragrant blooms fill a full-sized vase, creating a showpiece which will leave no doubt how you feel about her." Benefits, men, think benefits.

Servers. "We run Dual Xeon servers with 4 GB of RAM." These are features, which mean absolutely zero to your lay customers. Instead explain "Your website will run FAST and RELIABLY on our industry-leading servers." The benefits are in caps. Sure, it is fine to list your specs, many people do know enough to compare ;) but especially if your target audience is ordinary laypeople like campground owners, all they really worry about is that their site is online. They might not even be aware a site could conceivably run "poorly" (slowly, kick up errors, etc.) so educating them about how your servers would run their site quickly, and how their viewers like fast sites the best, shows them the value in your service.

I'm not going to give more examples because we're well into my target market ;) and I'm not in the business of giving away my own farm! :laugh: But think about it. Put yourself in the shoes of your customer, look at the world from their chair. What are their questions, what do they understand and what don't they understand? What are their biggest worries? There's a lot of things that you can "talk up" with people and make them into selling points.

Remember your expertise is also a selling point. Business people recognize an expert and naturally want to put their assets where they are best-served. That includes hosting their site with an expert who knows what they're doing. The business owner will feel safer, feeling that their site is in "good hands" and with the right person.

Note that credibility has NOTHING to do with price. Bricks-and-mortar business is entirely different from the World of WebHostingTalk :laugh: B&M business owners happily pay extra for a premium service, and they know it is a good buy. The more benefits you offer, the more money you can reasonably charge and that business owners will willingly pay. Benefits. Not features. Features are not benefits. ;)

Try to get your head out of the cheaper-is-better rut, because cheaper isn't better.

(Or, by all means, stay with the "cheaper is better" strategy, it makes it easier for me to sell my pricier services to your clients! :emlaugh:)

:D Bailey

What about different price standard? I'm offering a lot expensive web hosting to my local area (small business etc) than what I'm offering on internet(public). But for them, I have give some extra support such as configuring their email accounts, helping upload their web files etc. Even I have setup their email client for them for some extra charges. Also I have several business patners which offer my services and them will charge more to their clients. For example, let say I charge $10/month on public and to them(my business partner) but they are charging $20 to their client. What I'm affraid their client's know about this.

lol, good luck, but you wont know if you dont try, but word of advice be sure to make the deal as sweet as possible. A Great Man Once said "You catch more flys with honey then you do vinigar" lol, sorry looked like the best place to put that in.

Anyway good luck

I have a similar predicament. I know several people who have their own successful business, but their website looks like it has been done on microsoft word [or OOo for those of you who use it].

I somehow cant just outright ask them "Hey, do you need a new website host." I'm sure these guys are paying large amounts for a relatively un-fulfilled website. (No store information, little business information, cheap looking designs)

I also wonder if I should charge for designing their website as well? If so, whats a good cost too. I've seen [REALLY GOOD] people charge $200-$500 an hour, so I figure my work is worth about 20 an hour? How do I go about approaching them on this subject?

Note that credibility has NOTHING to do with price. Bricks-and-mortar business is entirely different from the World of WebHostingTalk B&M business owners happily pay extra for a premium service, and they know it is a good buy. The more benefits you offer, the more money you can reasonably charge and that business owners will willingly pay. Benefits. Not features. Features are not benefits.