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  1. #1

    How do web hosting make money?

    How do Web Hosting Company make money if they give $100 commission to affiliates for selling $5, $7 or $10 web hosting?

    Hostgator give $100
    web.com give $120

    How do these company make money?

  2. #2
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    The idea is to get them in the door and keep them as long term clients. People who are happy with their hosting rarely move, though people who buy really cheap plans are more likely to move to an even cheaper host overall.
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  3. #3
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    I think webhosting company can't make much money from private customers choosing stadart plans. When I pay for my host 5$ - it's too little to cover up support, technicians. See topic on that in "web hosting" subforum. My point is, web hosting company can make money only at dedicated hosting and customers who overuse standart plans and are buying "add ons" (additional bandwith etc).
    Private customers may be treated like a kind of advertising. If customer is happy, it is like he would say it to someone he knows ("tell you what, host X is a good one, hosted with them for years - and still no problem"). Worse when customer is unhappy - then screaming would appear ("don't ever trust this lame worthless host A whioch scams everyone!"). Example: a friend of mine told me about my current host. I went with then and now I host with them. I am not affected by advertising - it was by word of mouth only. Thus, they did not spent a cent to get me as a new customer.
    Talking on these large sums...I don't think it's wise.

  4. #4
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    Quote Originally Posted by YouYap View Post
    How do Web Hosting Company make money if they give $100 commission to affiliates for selling $5, $7 or $10 web hosting?

    Hostgator give $100
    web.com give $120

    How do these company make money?
    Remember also that not all accounts will result in a pay out like that, not every sale will come via an affiliate.

    As long as they can keep people for a long time, then it works out OK
    Alasdair
    Long time ex-host, ex-billing software owner/developer/support staff. Recent lurker.

  5. #5
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    You need to think i terms of 'loss leaders', marketing & cash flow before you can get your head round this type of 'system'

    1. To get the 'word of mouth' reputation' you need customers in the first place, but 'free accounts' are normaly of no value.
    2. What better way to market you brand than to have others do it for you, and don't forget those 'banner links' will only help with your Search Engine Ranking'
    3. Most hosts don't 'pay out' untill an affiliate has 'earnt' $250 for 30 days or so, this helps with there cashflow, or if there scammers they run and hide before 'paying out'.

    I think the reality is that there are good & bad affiliate schemes within the hosting industry, I guess any choices could start off with 'avoiding those that 'oversell & offer unlimited rewards'
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  6. #6
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    Read the fine print... there's always fine print
    Rob Moore
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  7. #7
    I do this all the time. I send customer to hostgator and I get $100 even if they sign up monthly. I have made thousands of dollars over the year sending customer to hosting company. The only company that don't pay good is godaddy. They pay like $2 referral fee so I stop sending people to them. I just dont know how others pay $100+. I want to start my own hosting company.

  8. #8
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    For sure, some affiliate programs work. An old saying relates - take care of your employees and they'll take care of you - applies to affiliate partners as well.
    ProlimeHost - Dedicated Server Hosting & KVM SSD VPS
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  9. #9
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    Quote Originally Posted by YouYap View Post
    I do this all the time. I send customer to hostgator and I get $100 even if they sign up monthly. I have made thousands of dollars over the year sending customer to hosting company. The only company that don't pay good is godaddy. They pay like $2 referral fee so I stop sending people to them. I just dont know how others pay $100+. I want to start my own hosting company.
    Wow congrats... sounds to me like simply referring people to HostGator might be your answer, instead of creating your own hosting company. You're doing quite well as an affiliate
    Rob Moore
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  10. #10
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    Not a bad idea to take your knowledge and start your own hosting company.

    HostGator etc have the cashflow to pay for these potentially long term clients.

    Not to mention they operate a huge stable (depending who you ask) network.

  11. #11
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    Quote Originally Posted by bear View Post
    The idea is to get them in the door and keep them as long term clients. People who are happy with their hosting rarely move, though people who buy really cheap plans are more likely to move to an even cheaper host overall.
    Very well put.

    -mike
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  12. #12
    i run a web hosting site and ill tell u its not easy
    first the money u make is far from worth the trouble u have to deal with everyday

    but also as u can get your hosting to pay for its self then thats
    all that really matters i guess
    thats why i do it i sell hosting so my hosting is free
    and it works

  13. #13
    Hi,

    Make you customer stay with the best of services, Keep the customers happy and they will keep you in business.

    Binoy

    <<Signature to be setup in your profile,>>
    Last edited by anon-e-mouse; 07-14-2009 at 01:41 AM.

  14. #14
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    Just how imortant is that little word 'IF' used in the OP ?

    Seems like some of the recent post didn't notice it ! or even the OPs comments on Affiliates.

    Still IF the titles says one thing,
    why bother to read the thread, it's not as IF anybody else will !
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  15. #15
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    Just how imortant is that little word 'IF' used in the OP ?

    Seems like some of the recent post didn't notice it ! or even the OPs comments on Affiliates.

    Still IF the titles says one thing,
    why bother to read the thread, it's not as IF anybody else will !
    .... Not feeling you here, What is wrong...
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  16. #16
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    Quote Originally Posted by YouYap View Post
    How do Web Hosting Company make money if they give $100 commission to affiliates for selling $5, $7 or $10 web hosting?

    Hostgator give $100
    web.com give $120

    How do these company make money?
    This is the OP, YouYap[luvly name] is asking a question based on:
    IF they give $100 commission to affiliates for selling $5, $7 or $10 web hosting

    Seems to me that some of the more recent replies have chosen to reply to the title
    "How do web hosting make money?"
    rather than bother to read the OP,
    but heh, this thread is more than 10 posts long, I suppose I'm being optimistic
    to expect people to read the whole thread BEFORE posting themselves.

    Maybe I'm just having a bad hair day
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  17. #17
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    Hi!
    I don't think you realize that a host either gets such a customer into a yearly contract to payout that much..or at least hopes the customer will stay for a few years.

    The key is reading the fine print!

    Hostgator:

    When and how often will I be paid?
    Your commissions are paid on the last week of each month following the first 60 days after the sale. The registered account must also be currently active and paid up to date at the time of payout, and there is no minimum balance limit to reach before you are paid.
    For example, if you made one sale in January, you will be paid your $50 commission the last week of March. If you continue to make regular sales each month afterward, then expect to be paid on the last week of every month (after your first commission payment).

    So..Hostgator has to have a customer for at least three months..for you to get paid. Most will stay longer than that..so it all comes out in the wash. Programs like this work because a host has very little upfront costs..and normally money is made in the long term of the relationship.

    Web.com:

    First and foremost..this is a host that sells a ton of other stuff other than hosting. You quoted the hosting + sitebuilder payout..I've not got time to check that..but it was easy to see the $150 payout is for a account that costs at least $60/month. This host "gives" a domain away as part of the deal..which almost always insures the client is going to be around for awhile..because most likely that domain will not be transferrable. So...there you go. They are going to make money...plain and simple.

    >>>Also..consider the rules:
    AFFILIATE PROGRAM TERMS AND CONDITIONS (Updated June 30, 2009)

    In order to participate in the Web.com Affiliate Program, you must meet the following minimum qualifications:

    Your website must be fully-functional.
    You must be the verifiable owner of the domain used when applying.
    Your website must receive a minimum of 2,500 unique visitors per month.
    Your website must be written in English.
    Your website cannot contain any illegal, offensive, or objectionable content.
    You must fully complete an electronic version of an IRS W8 or W9 form, as applicable.
    You must agree these Web.com Affiliate Program Terms and Conditions.

    >>>>

    Nobody sets up a website and gets 2500 uniques overnight.

    >>>On second thought..a celeb might be able to.


    Bryon
    Last edited by bryonhost1; 07-14-2009 at 09:09 AM.
    Bryon L Harvey
    Soil Relocation Engineer

  18. #18
    Thank You for noticing. I have same problem when I post it in affiliate forums. People easily go off topic and this why I post here and yet people go off topic.

  19. #19
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    Hosting business is a rough business now. You have to provide exceptional services to stay in business.

  20. #20
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    Quote Originally Posted by YouYap View Post
    How do Web Hosting Company make money if they give $100 commission to affiliates for selling $5, $7 or $10 web hosting?

    Hostgator give $100
    web.com give $120

    How do these company make money?
    Howdy YouYap, let me quote HG's website:

    Code:
    11-20 a month		$100	per sign up

    That's only if you give them 11-20 signups. They hope that when you refer them to HG they stay with HG and then refer others

  21. #21
    They pay $100 per person. No rules no monthly limit or quota..It straight forward. Join cj.com and you can get $100 each person

  22. #22
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    Quote Originally Posted by midnight View Post
    Hosting business is a rough business now. You have to provide exceptional services to stay in business.
    - dah -
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  23. #23
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    Quote Originally Posted by Brian-de-vie View Post
    - dah -
    Every business is rough now, let alone hosting. Maybe some of us are not aware of the present economy in not only US but the whole world.

    Thank you for your quote anyway. It's great!

  24. #24
    I see you do hosting midnight..How many clients do you have and how long did it takes you to get there? How many calls or queries do you get from customer per month. Does it worth it...are you profitable at this time?

  25. #25
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    I am in partnership with two others who have been in the business for over 8 years now. We have pretty good clients base. We do get few calls a month but most of our clients use our ticket system.

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