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  1. #1

    Question Spend more $ for marketing or for improving servers ?

    Hi,

    I am new in starting a webhosting business, but much experienced in this field, server administration and programming(not a kids host running for 1 month)...I started with local business clients, hosting their websites in another companies and now decided to have own company.

    Would you consider spending thousands of $$s for getting into top 10 in many review sites ? (Some ask for $6k to be ranked #1). Personally, i think this is just getting customers by fake reviews and rating. (google "hosting reviews exposed).

    I will never again look into the top 10 list, once i signed up in top 1 host (about 2 years ago), the service was like my homeserver(on DSL) was faster than their server to be accessed from another countries. And they send me out in first month for resource usage (500mb in unlimited plan) and took 4 weeks for money back)


    What about ppc and others like adwords, adbrite etc; ? From threads here, it seems like ppc takes much money and gives less clients; and word of mouth is the best.

    I know there are many similar threads here related to advertising, but just wanted to know opinions on advertising in review sites.

    Thanks
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  2. #2
    Join Date
    Apr 2009
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    You definitely need to allocate enough funds to manage your infrastructure whether it be managing/monitoring your servers, providing technical support for your customers, software(s) required to run your business etc. Without this you wouldn't have a business!

    I also think it is important to have a Marketing budget. If you simply have a website done for your Business, the rest of the world won't know about your Business unless you advertise and get your name out there. Now if you're starting off locally and work your way in from there that is a completely different story but definitely have a set amount of funds for marketing even if it is a small one.

    Good luck!

  3. #3
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    I would focus on making your product differentiable first, then put some money into marketing. In my opinion, if your product is exactly the same as the competition, even good marketing may not help you stand out enough.

    -mike
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  4. #4
    I would spend the money on marketing as your priority.

    Without customers, your business will fail, even if you have the best website, amazing service, awesome servers, etc...
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  5. #5
    Join Date
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    I also say marketing. Without customers, you don't need servers.

    Marketing is more than advertising, BTW. It's identifying, targeting, and reaching out to a specific niche (or niches) who need your product/service.

  6. #6
    Join Date
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    Quote Originally Posted by The Hosting Team View Post
    I also say marketing. Without customers, you don't need servers.

    Marketing is more than advertising, BTW. It's identifying, targeting, and reaching out to a specific niche (or niches) who need your product/service.
    Likewise, without decent servers, your churn will be high (and chargebacks as well). Line up a few decent servers and spend on marketing.
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  7. #7
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    Again marketing, unless of course your servers are in need of repair/upgrade. ;-)
    Michael Copeland
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  8. #8
    I say split in half, if you have out dated servers, no one will be with you, but if you don't have clients, it doesn't matter
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  9. #9
    Join Date
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    Without customers, your business will fail, even if you have the best website, amazing service, awesome servers, etc...
    That is the sad, soul crushing truth. A mediocre service that's well marketed will win over a high quality service that no one knows about. Then again, having your own small following, and earning a good living is enough for a lot of people. Beats working for others anyway.

    (Some ask for $6k to be ranked #1).
    They'll probably want regular or higher than regular affiliate commissions as well. But, if they bring in the sales, the ROI may be positive. Some of these sites do have significant, well targeted traffic. Not sure it would be the way I would want to go about it either though, but if you end up operating in the typical budget hosting market, you do want to get featured on these sites, even if you will never make it as #1, which means having a generous affiliate program.

    Buying well established hosting brands that are compatible with your business model could be a way to get that "word of mouth" advertising you mentioned. Gathering up the critical mass is the hard part, then things get a lot easier.

  10. #10
    As others have said, marketing is a HUGE part of web hosting. I see it everyday, the hosting providers who know how to market them self are the large and successful ones. The hosting business I'd say is a good split being half hosting and half marketing. Of course, if your servers are crappy and always down, no one will purchase hosting from you in the first place. Then again, you can have some great quad core servers sitting around, with little or no clients on them, and then finally you end up going belly up.

  11. #11
    I would agree. You need marketing certainly to be sustainable, but start with people around you.

  12. #12
    If you have a profitable income from your existing clients and you want to consider marketing and bringing in a large number of new clients, then you should consider how you're going to grow to large influx of new customers (hopefully).

    So, look at your marketing options, crunch some numbers, think about how much you're likely to grow based on various expenditures in marketing in the next 1, 3, 6 months - both conservatively and generously - and plan your infrastructure accordingly.

    No need to spend thousands on infrastructure if the clients aren't coming in, but you're going to run into problems with a smaller hosting service if you spend thousands on marketing and you've nowhere to put the new clients.

    Thus the real-world version of Sim City

  13. #13
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    i would rather spend on marketing , after u get customer u can always spend or work something out on infrastructure, NO CUSTOMER, NO INFRASTRUCTURE.

  14. #14
    Join Date
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    Obviously spending money to improve service is the most important, rather than wasting money on marketing and advertising all over the place.

    If your service is better, clients are happy, they refer or recommend more clients to you, won't it be a win-win situation, rather than wasting on marketing, and service doesn't improve at all.

  15. #15
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    Quote Originally Posted by SurmountHosting View Post
    I started with local business clients, hosting their websites in another companies and now decided to have own company.
    Starting with local business is a great way to go for starting a small business. Word-of-mouth in particular can go a long way. You should put the word out to as many people as you can that you are open for business, regardless of whether or not they are related to the industry. Some of your leads will sometimes come from very unexpected places.

    Quote Originally Posted by SurmountHosting View Post
    Would you consider spending thousands of $$s for getting into top 10 in many review sites ? (Some ask for $6k to be ranked #1). Personally, i think this is just getting customers by fake reviews and rating. (google "hosting reviews exposed).
    Any site that ranks you based on the amount of money you pay them is completely worthless, and does not deserve a cent of your money.

    Quote Originally Posted by SurmountHosting View Post
    What about ppc and others like adwords, adbrite etc; ? From threads here, it seems like ppc takes much money and gives less clients; and word of mouth is the best.

    I know there are many similar threads here related to advertising, but just wanted to know opinions on advertising in review sites.

    Thanks
    Don't forget SEO. In the long-term, it will be a better use of money as it will keep bringing you traffic without having to continually spend money on advertising.
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  16. #16
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    I would focus on free marketing enough of it around these days and invest into your infrastructure, after all that’s what your business is all about right?
    Jon Black

  17. #17
    Improving the servers will cause better customer experience and more referred customers
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