I'd like the industry's opinion on what has made HostGator such a popular and successful company.

In my opinion, their affiliate program had a lot to do with it.

1. Very cheap pricing with LOTS and LOTS of resources promised.
2. Their affiliate program is one of the more generous out there.
3. ThePlanet is a pretty good facility to source their servers from.
4. They have a pretty good rep, considering their size.
5. A well designed site.

Don't forget SEO.

Don't forget SEO.

which relates directly back to the affiliate program (their rankings are large in part due to the tens of thousands+ backlinks from affiliates)

Yeah, affiliate programs do have that double benefit, with all those inbound links that Google loves. Although I'd hate to be the one sifting through all the affiliate fraud they must be on the receiving end of. :eek2:

I doubt affiliate fraud is such a problem.

Besides, all affiliates must wait 30 days before getting paid out, which is enough time to sort out and audit everything.

Brent did mention on WHT how much affiliate fraud they have to deal with, or to that effect. I don't have time to sift through his posts, and the WHT search function is still basically useless, but they do deal with a lot of affiliate fraud, if memory serves me correct. Offerring big commissions and you're bound to attract a certian element of undesirables, thinking they can make a fast buck. :eek3:

Brent did mention on WHT how much affiliate fraud they have to deal with, or to that effect. I don't have time to sift through his posts, and the WHT search function is still basically useless, but they do deal with a lot of affiliate fraud, if memory serves me correct. Offerring big commissions and you're bound to attract a certian element of undesirables, thinking they can make a fast buck. :eek3:

Yes indeed. but it is mostly the webmaster is affected by leading a customer to them and finally they cheat him by stating either fraud sign up or the customer went away after a month of signup.

rarely do hosts get affected.

I'd like the industry's opinion on what has made HostGator such a popular and successful company.

In my opinion, their affiliate program had a lot to do with it.

To me Brent seems to be honest and commited towords his work - he knows the market very well and ready to tap oppurtunities.

Hostgator has setup a good example for other hosts in industry.

A very well worked out affiliate program with one of the biggest payouts is one of their major success points in my opinion, along with a committed owner.

They do offer a lot with the affiliate program. That is a BIG plus for them.

As a company HG is appreciated by the customers and they tend to stay with the company and buy more accounts (for example I know people that started with 1 reseller account there and moved to dedicated servers with them or to multiple reseller accounts).

They do business based on a business plan and that is something A LOT of hosts don't do. They afford the great affiliate plan because they retain the clients for a long period of time.

They also oversell the servers in shared hosting and attract the customer by selling 100,000 MB space and 100 GB / month for $9.95 a month when the average customer uses no more then 1-2 GB space.

Brent is, in my opinion a very good business person that knows how to market his business, knows how to keep most clients happy and deliver what they need in order to retain their business.

Affiliate program and good rep.

Word of mouth has my vote. They have done allot of hard work to get where they are today, you provide great service to one client and they will tell the world.

which relates directly back to the affiliate program (their rankings are large in part due to the tens of thousands+ backlinks from affiliates)

Definitely.

Also, for those who haven't seen it:

http://www.google.com/search?hl=en&q=reseller+hosting&btnG=Google+Search
http://www.google.com/search?hl=en&q=cpanel+hosting&btnG=Search

Top 5 for dedicated server as well

Well i think they have a very good word of mouth thing going around, and also a well planned affiliate program

I am impressed with their affiliate strategy. Where is the best place to find or outsource good marketing gurus?

Thanks

Where is the best place to find or outsource good marketing gurus?It depends on what is your budget.

I true marketing "guru" is definately not going to be cheap. And whatever strategy / proposal they deliver will also not likely be cheap.

As with any business, it often takes money to make money. Otherwise, you must "make up" for any lack of money by paying the price with extra time, extra effort, and extra luck.

Personally, I think what makes hostgator "successful" (I have never seen their books) is their affiliate program. We've had lots of people transfer away from them, and when I ask why they originally selected hostgator, they always say it's because someone "recommended" them. I have no doubt that "someone" was paid an affiliate payout for that "recommendation".

Hostgator's owners are, in my opinion, probably the smartest of the bunch here on WHT.

Look at the market - people want a lot for nothing, and as web hosts, most of you realize that most people don't use even 10% of what they buy. Based on averages like that, it should be easy to provide for these customers. Provision for 15%, promise 500%, and both sides are happy.

Instead of targeting the higher end customers that are willing to pay extra, which are a commodity in this market, they simply went for the masses, and please them through marketing. In the end, they might be using the same resources as our own customers, but they promise more than that because it's what people want.

Due to their large client base, they've worked out all the numbers, have metrics in place for everything. Because of these metrics, they can offer a high referral fee for affiliates. If they can make a profit on an account even after they spend $125 getting the account, it's worth it to them.

Edit: In short, I envy what they've done, and if I could do it all over again, I'd go their route, that's where the money is, and as business owners, that's what it should be. I'm not saying to walk away from providing a high quality hosting service, but you have to do it in the masses. Rackspace is a good example of that, and so they've made it work, but that's not very common. The money is with the masses.

They entered the market at the perfect time, Brent was dedicated enough to take advantage of the optimal market conditions, they brought in enough revenue initially to find a generous affiliate program, and it all went from there..With volume comes the ability to offer extreme hosting packages at the best costs in the industry...with that brings new clients. But it all started with the initial hard work, from there..it's easy.

The risk with affiliate-based hosting providers is you have to sustain business, and eventually you aim to get word-of-mouth recommendations from clients brought in by affiliates.

Ankit,


I enjoyed reading your comment. I am going to share your post with my team as I have been thinking about the same things you mentioned: "it is about the masses" mixed with trying to give the highest quality possible. I did read about Hostgator's history a few months ago and I was quite impressed. After years of being in business we all understand the fact that we still have a lot to learn. At any rate I enjoyed reading your humble comment termendously and wish your company the best.

Regards,

One thing that I don't think was mentioned in this thread is that HostGator has kept their business model simple: hosting and hosting only. Of course, SEO (through SubmitNet) and, I believe, Web design were/are offered, but the primary business still remains Web hosting. This is more helpful than a lot of folks might give credit for. A consistent focus goes a long way in building a brand image, and a clear path for the future of the business.

They're really successful, however, Ive been hearing some negative reviews about them lately. However, I have to admit they dominate the reseller industry...or most of it at least :D

they brought in enough revenue initially to find a generous affiliate program, and it all went from there..Actually, even now, according to Brent, affiliates account for only 30% of their sales (something they plan to change, but not by reducing their in house advertising spending). As fate would have it, I've been an affiliate from back when they paid $9 for a $9 sale. Back then, the bulk of their sales was due to direct advertisements placed anywhere where he determined they led to long term profit. That's just how it should be. Run a test advertising campaign, calculate ROI. If positive enough, keep advertising and tracking results. You have to know your the customer's lifetime value very very well though, which I fear not many hosts pay attention to, or heavily underestimate. It's easy to see this when you look at the affiliate commissions some hosts pay, despite selling high end hosting, with a relatively high markup.

The focus on the affiliate program came (I believe) once the other advertising venues started to run short. Fact is there's only so much money that can be spent profitably on advertising, at a given point. I would not be very surprised to see HG launch a second brand some day.

One thing that I don't think was mentioned in this thread is that HostGator has kept their business model simple: hosting and hosting only.They kept more things simple than that. All the servers have the same configuration. That's not an accident. :)

HostGator was also one of the first big hosts to advertise unlimited domains on their shared plans which was huge when that first came out since they were the only ones doing it.

Once they hit the right direction, nobody was able to stop them.

Top 5 for dedicateds? That's new to me.

I really admire HostGator and look at them as role models. We source from the Planet and SoftLayer, however I have to admit, lately we have had a slew of new resellers come over from HostGator not very happy. I haven't looked at the reasons why, but I did notice they migrated everything from HostGator.

I will post when I find out more why they moved over.

I haven't looked at the reasons why, but I did notice they migrated everything from HostGator.

I will post when I find out more why they moved over.

I tried to edit my post above but found that I couldn't.

Update to my statement above: Again, I really admire Hostgator and the people there. It looks like the clients who migrated from there were being cut off for non-payment, thus were "leaving" anyway. As of yet, we have not had any problem with our new resellers so no complaints - yet.

Hostgator, recommended highly. :agree: