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  1. #1

    * What would you do with a $3,000 per month advertising budget?

    Hello,

    Looking for some help with ideas here. Our hosting website is almost done and I finally got to peak at it today from my designer, and I thought it looked pretty darn awesome.

    I already signed up with TouchSupport to handle our helpdesk 24x7 and I am looking into eTechSupport or RootSupport to handle our 24x7 live chat also. This way we should have true 24x7 live chat and ticket support (with a 30 minute response sla) which will be one of our selling points.

    Anyways, we setup some pretty generous packages, and are assuming that most people will sign up for the $10 per month plan.




    My question to you is...


    If you had a $3,000 per month budget to advertise a brand new hosting site, where would you advertise and how?

    Our 1st goal with this budget is to achieve 200 clients on a $10 per month or higher plan. This will cover all business expenses from all our businesses combined. With a $3k/month budget how long would you expect to achieve 200 clients, assuming that we had good prices and a nice looking website?

    Would you recommend PPC, banner advertising (through Tribal Fusion for $6CPM), or what method of advertising would suit a $3K budget best?




    Any other ideas about what to do with a $3K Advertising budget? (Equals about $100 per day)

  2. #2
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    WoW!

    With that so much budget, my first advice is

    1. STOP!
    -ok now, u have stop... think back your strategy. Dont spend just because you can spend. Hosting is a saturated field. Good luck!


    ----
    a litttle tid bits of unusual advertising idea...

    1. try sponsoring high value customers- webdesigner, programmer, etc.. don't forget sports site, merchants (they need to expand to reliable hosts, plus, they have the money! they just need your guarantee that their site will be up!)

    2. subsidize your prospects (with that so much money!)

    3. PPC click is okay, but make sure you know how to do it.

    4. Banner? I will left it to others to comment, not my fav though..



    ----


    final advice, don't spend because you can.


    good luck!
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  3. #3
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    i would put my site in my sig then worry about i was gonna do with the 3k/mo
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  4. #4
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    Ya spend some time deciding who you are targetting, I hope you arn't going after just generous customers unless you thought about how expensive that will be.

    Find a niche as ads in it will be cheaper. Example, if you want to focus on advertising to web designers find some low key forums or sites and get some text links or forum stickies going, both have good ctr and usually run cheaper.

    Who are you trying to focus selling hosting too?

    I would estimate that worst case and if you are going after general clients in a general advertising market you will get at worst 15 new clients a month with 3,000 each month. This is a worst case estimate. So to get 200 clients would take 13 months. With a niche you can get those much faster...
    Last edited by bwb; 07-07-2005 at 03:31 AM.
    Like passive recurring revenue you can retire on?
    You focus on building your brand, we handle all support, billing, and more.
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  5. #5
    Originally posted by shotgun7
    i would put my site in my sig then worry about i was gonna do with the 3k/mo
    Hello,

    Website design is not yet completed...still under construction.


    To startup our hosting business we planned to invest 20% of our monthly profits into the business, which is about $3K per month.


    Our website is almost done, we've already setup our support contracts, in the process of setting up the live chat contracts. All other scripts and billing software are ready to go. Just waiting for the designer to completely finish before I publish a link.

  6. #6
    Originally posted by bwb
    Who are you trying to focus selling hosting too?

    To be perfectly honest, we were planning on going towards the general audience looking for $10 per month hosting (of course we have higher end plans).

    To me $3K to advertise is nothing, especially if we do CPC. That's only about 750 clicks at $4.50 CPC.

  7. #7

    Thumbs up

    I would take monthly trips to exotic islands in an attempt to obtain new business, via direct marketing and word of mouth. By speaking with any and every attractive bikini wearing potential customer.


  8. #8
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    Originally posted by RazzBlade
    I would take monthly trips to exotic islands in an attempt to obtain new business, via direct marketing and word of mouth. By speaking with any and every attractive bikini wearing potential customer.
    Hah, I second this suggestion, I can vouch that this will result in a very happy business, maybe your niche is tall attractive blond bloggers?
    Like passive recurring revenue you can retire on?
    You focus on building your brand, we handle all support, billing, and more.
    Pressed.net - Start your own Managed WordPress Hosting Company

  9. #9
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    Originally posted by 2HostUNow
    To be perfectly honest, we were planning on going towards the general audience looking for $10 per month hosting (of course we have higher end plans).

    To me $3K to advertise is nothing, especially if we do CPC. That's only about 750 clicks at $4.50 CPC.
    True but why waste the money? Why not think about who needs that type of hosting and go from there and hopefully get a higher CTR and people who actually sign up, I'm not sure CPM ads on any big networks are the way to go. Maybe say ok lets target bloggers, SEO people, and web designers, so target those forums, blogging software / script sites, and web designer forums? Going to be much cheaper I bet and have better turn over.

    Also if you would like you can pay me 3,000 a month and I will sign up for 200 plans at $10 bucks a month each month , I would have to cancel at the end of each month though. this can continue as long as you would like .
    Like passive recurring revenue you can retire on?
    You focus on building your brand, we handle all support, billing, and more.
    Pressed.net - Start your own Managed WordPress Hosting Company

  10. #10
    I'm actually considering hiring someone here on WHT to help me find a good market to target and some good places to advertise, but I will need to make a post on the proper forum for this..

  11. #11
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    I'd go for offline advertising, get some flyers, stickers tshirts whatever. it usually works.
    Marketing For Hosting Companies:

  12. #12
    More you Invest on Advertising more your business grows. Money attracts money and thats how most of the companies having their banner getting displayed 1000 to 10000 times a day on WHT are growing.

    Banner advertising on WHT is just for branding while google adwords will get you real customers. You wont get affiliate signups in the beginning as your company is new but 24x7 support & google adwords will get you at least 5 signups a day if you can pay $4 per click with budget of $3k per month.

    Overall conclusion would be that you wont be making any profit in first & second month but after that you will get good returns as well as affiliate signups will start.

  13. #13
    Originally posted by etechsupport2
    Overall conclusion would be that you wont be making any profit in first & second month but after that you will get good returns as well as affiliate signups will start.
    Agreed... Well hopefully with the first $6K invested we can have at a bare minimum of 200 clients.

  14. #14
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    Originally posted by 2HostUNow
    . . . To me $3K to advertise is nothing, especially if we do CPC. That's only about 750 clicks at $4.50 CPC.
    And you might convert 3% of those, so be prepared for some poor conversion rates, and high customer acquistion cost.
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  15. #15
    right now I recommend adwords only!, 2mhost getting around %6 conversation rate for low $3 per click.

    put your 24/7 phone number or live chat and you can convert all visitors (who willing to buy) to customers.

    wit adwords and other type of advertising, never think that you will spend XX amount to get XX sales, this not work this days. if you get 50 customer by this $3k then you will be lucky.

  16. #16
    The more focused/targeted the keyphrase(s), there can be higher CTR. I am averaging between 3 and 4% CTR for ads with thousands of impressions.

    SE traffic is considered to have the highest conversion rate.

  17. #17
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    Originally posted by 2HostUNow
    Agreed... Well hopefully with the first $6K invested we can have at a bare minimum of 200 clients.
    That's pretty damned aggressive, I doubt 6k will bring in that many clients.

  18. #18
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    I would spend that money buying up hosting customers from smaller hosts here at WHT. As long as you do it correctly, the ROI is so much better than advertising.

    PS: You *must* do it correctly though - don't just buy up any customer that is for sale or you'll be sorry.

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  19. #19
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    If your budget is limited to $3K/month, I'd look at tagetting certain websites which have a large # webmasters, like design and development forums. CPM advertising can have much better ROI than CPC advertising in the long run..
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  20. #20
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    Buying client contracts is still a better way to spend that money.

    Why throw ad dollars at "maybe" customer orders, when you can buy "already" customer??

    --Tina
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  21. #21
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    Well, from my perspective ad campaigns pay off much better for your company in the long term than buying out small companies.

    When you advertise via banner ads and promotions, you create more brand awareness and you reach a very large number of potential buyers on the internet. That may not result in immediate sales but over a year, the results are very good. And this brand awarness continues to generate sales even when you aren't advertising

    If you plan to do CPC advertising, yes, buying out small companies may be the best idea.

    We recently were considering to buy a company priced at about $100K, with $80K as annual revenue. If the company is generating 80K annually, its making about $6500/month gross. Now probably only 60% of that would be profit i.e. about $3900/month. ROI would be in just under 2 years...

    Instead, if you put $100K in advertising, assuming $50 is your average customer aquisition cost, and each customer is paying $10/month, you'd end up with 2000 customers or $20,000/month as revenue upon exhausting those funds (ideally in a year)..

    $50/customer is the average aquisition cost, and with a well crafted ad campaign you can easily achieve that if not less..

    I have never considered advertising risky when well planned. You will always get results from it. However you can never predict how the customer base of an aquired company would react
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  22. #22
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    3K a month. That's wayy more than you need.


    Get a 1-800 phone line, and a sales person if you don't already have one. Spend maybe half of that and save the rest for other things.

    Advertising only does so much, I find word of mouth really helps grow hosting company's. But the entire market is saturated.

  23. #23
    google is a good way to get targeted viewers

  24. #24
    I would like to suggest that before meeting the advertisement costs $ 3K/month, such a big amount one should make a media strategy as it can be helpful to check the flow from the review of the marketing and advertising situation.

    As the primary role of advertising is to influence the brands which consumers usually select. To get them to buy your brand, you need to reach the target segments with your defined media objectives, hence advertisement is must in the present competitive environment.

    The following outline suggests the most relevant pieces of background information for media planning.

    STEP 1. Reviewing the marketing and advertising situation

    A. Marketing Factors

    1. Who is the competition and what market share do they hold?

    2. What is our marketing strategy? Our marketing objectives?

    3. What buyer problems does our product solve?

    4. What marketing decisions have been made about the internal marketing elements (product, price, promotion)?

    5. What external environmental factors are influencing the marketing of our product?

    B. Advertising Factors

    1. What role is advertising expected to play in the stimulation of brand demand?

    2. What are the advertising objectives?

    3. What is the size of the advertising investment?

    4. What is our creative strategy? What are our creative tactics?


    STEP 2 Selecting the target market.

    As the basic function of media planning is to select media that reach the target audience, you must know the target audience with as much precision as possible. Usually the target market is selected in the earliest stages of marketing planning; this is your responsibility to define the target market.

    Target audiences can be specified in a number of different ways, such as by using demographically, life style and product usage. One of the reasons you should emphasize the importance of early identification of the target market, and their sub market.

    This is the fact in advertisement that there is strong evidence we have been riding the wrong horse, as errors in media selection are very costly, media costs are very high.
    Last edited by etechsupport2; 07-08-2005 at 02:53 AM.

  25. #25
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    3k would buy alot of cotton candy.....

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