Hi there,
Ive decided to get away from the really cheap hosting, because basically if i dont i wont have a business much longer.
I did make a profit last year so i have decided with the email i am sending to my customers telling them about the new site and new services, that they will not be affected by the new prices this year, they will still pay the old price that they have already paid and the new customers will pay new the new price.

Part of my justification for raising the price is that i have introduced new services and that we are using far more reliable servers than when we started out, which will definitely appeal to those who have been on the problem servers.

Do you think this sounds ok?

Sure... as long as you keep the current customers' prices where they are as you said. Inflation, new services, more support, etc all justify a price increase :)

I think that as long your current customers are not affected in any way, there is no reason why you shouldn't raise your prices if it will allow you to provide better service for your old and new clients.

Boris

We raised prices on our cheapest plan by $2 last year, and applied it to all existing customers. We had about one in 300 customers cancel because of it. Financially speaking, it was well worth it.

One thing that helped was that we increased some of the stats on that account (# of mailboxes etc).

I remember when I had my account with a very big hosting company, they used to have unlimited bandwidth on their servers which they still left for me. (changed for new customers).

Also they raised their prices but again left me in the old price bracket even though the amount of features they added was more.

But then again I was paying them 24.95 which isn't really dirt cheap hosting.

I recently raised my prices by $2 per package.. and I applied the change to every existing customer.

I had about 2% leave because of the increase... which is nothing considering I instantly increased my gross revenue by quite a lot!

I think it's all in how you write your announcement email. If you explain that the reason you're increasing prices is to benefit them, to increase reliability, security, faster service/support or whatever.. then they will realize it is in their best interest to pay. Besides, if they're happy with you already.. then a whopping $2 per month is NOTHING.

(This is assuming that your existing clients didn't pick you simply because you were offering one of those unlimited packages for $1 per hear... :rolleyes: .. in which case.. expect everyone to leave as soon as you increase prices.)

Good luck. Let us know how things progress.