Thread: Concerned about pricing
11-14-2002, 12:40 AM #1Newbie
- Join Date
- Oct 2002
- Chicago, IL
Concerned about pricing
I have been trying to decide the best way to price my web hosting packages. I have done the research and prices are ranging from $3.95/month and up (some of these plans are completely unreasonable concerning bandwidth/disk space). I currently get 1gb disk and 15gb bandwidth and it is becoming incredibly difficult to "divide" the space. I am looking to this forum for some guidance on the best way to stay profitable.
11-14-2002, 03:37 AM #2Web Host :)
- Join Date
- Jan 2002
The best idea is to write out a small business plan of how much you need to charge to still be in business 2 years down the road. Don't even bother trying to be the cheapest or try to compete with some of the companys around here as alot of the $2.00 per month for 500MB 25GB bandwidth hosts will not be here down the road. Keep your prices mid range priced and keep them there and treat the customers you get like gold and it will pay off in the long run and the main thing is realize it takes time and that no your not going to be able to quit your day job in three months but you will be on your way and in the much better position than if you offer the cheapo account and get 100 of customers and still cant afford another tech person and end up jumping ship and leaving all your customers screwed.. Its a really tough market as everyone seems to want to be a webhost nowadays(sp?) but if you give it time and stay determined you will make it.. good luck
11-14-2002, 04:15 PM #3Junior Guru Wannabe
- Join Date
- Sep 2002
I'd echo everything OKIHost just said, then emphasize how *absolutely* important it is to price your services for a reasonable return from the start. Sinking your time, efforts and personal investments into something that loses money from the start and has no chance of recouping those losses is a guarantee for a business that won't be around for very long.
So what's a "reasonable" return? That will be up to you, and you'll need to examine a lot of factors before setting your prices: How much are you spending on your reseller account? How much is your time and effort worth? Are you looking at simply earning a little extra cash right now, or seeking a way to support yourself full-time so you can quit your day job right away (not something I'd recommend, by the way)?
Once you've decided on a fair price -- something that will appeal to a reasonably sized customer base and provide you with a decent return -- then it's critical to do everything you can to hold on to your customers and build from there. It's much cheaper (and far less painful) to keep serving existing, happy customers than to have to go out regularly to find new ones to replace all the ones who've left because of service complaints, etc. Besides, good word of mouth can provide you with some of the best advertising and marketing muscle you can find.
Best of luck!Shirley Siluk Gregory
The ebi Group http://www.ebigroup.com
Business Plans, Marketing Plans, Resource Guides and Research for Hosts and Resellers
11-14-2002, 04:37 PM #4Newbie
- Join Date
- Apr 2001
I too agree with both ebigroup and OKIhost, although I would like to add something more, based on what I have seen of our resellers.
I believe the most successful resellers are the ones that not only act as the middleman for the webhosting company, but also provide their own unique service in conjunction with the hosting. A regular customer will not know the difference between a company that offers 1Gb of space with infinite domains and bandwidth, from the one that offers reasonable features.
With this in mind, it may be more profitable and wise to model your prices around good hosting features and a service that will give your clients something that all the other hosts do not provide, and that will consequently make you stand out and justify your higher price.
You also want to stay away from those "$2 plans" in case the hosting company decides to restructure itself, and all of a sudden you are faced with a 200% increase in cost of service.
Hope that helps!
Last edited by cosmotek; 11-14-2002 at 04:44 PM.Oliver
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