I'm just a customer but I have always been wondering:

Is the 30 day money back guarantee hurting a web hosting business? If a customer cancels within 30 days you basically lose money on it: the bandwidth he has used and the credit card transaction costs associated, etc. Is that a problem in general for the hosting business?

Most new sign-ups rarely use alot of resources. The only accounts i can think of that actually use their allocated resources during the first month are established websites that get transfered.

However you bite the transaction cost. But its a chance you have to take.

Speaking from experiance, a 30 day money back guarantee is vital to showing the customer that you can be trusted (granted that are some companies that offer it and dont give it).

The only time the 30 day stings a bit is when someone signs up for a big account and they use a lot of bandwidth for 28 days or so and then decide to move (In my case I disovered a user distributing warez from my server and shut him down immediately.) But since my warratny is an iron clad 30 day, unconditional warranty, I went ahead and refunded his money.

I know, I know I'm a softy but I've never had a charge back. <knocks on wood>

I don't think the guarantee hurts the company, rather I think it helps there business grow. As more and more people try the web hosting company's services, the more customers that company gets and the more they stay. Although some people do abuse it, but it occurs in rare instances. Again, I think the positives outweigh the negatives of having the 30 day money back guarantee.

I'll agree, eating the cost for the credit card transaction and your time spent to set up and then turn around and remove the clients account its just the cost of doing business and keeping the customer happy...

However, we've had a rash of 'host hoppers', you know... the stay-28-days-now-I-want-my-money-back-kind like was mentioned here... We've actually pulled our money-back guarantee but continue to offer a refund if our service is unsatisfactory, has problems, downtime, if the clients cant get timely support responses, or other such issues. Its reduced the host-hopper turn-over and let us focus on keeping our existing customers happy :D

Haven't had any complaints on it yet -- Just a few questions why, but not any complaints. :D

I know the feeling Ronnie.
We have had two cases of customers going overbandwidth in a few days, being investigaetd and found to be warez sites then after we terminate them they ask for their refund under the guarantee.
Then they get annoyed when we don't give them the money back.

The biggest problem with it is that customers need most support in days 1 to 7 so you are doing most of the work with them still able to pull out on the deal.
This is not normal practice in any other business.

Fortunately we don't get too many people cancelling within 30 days.

Gordon