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  1. #1

    I think I've found a nice niche...

    Which will bring me in quite a few customers with some work but my problem is that I don't know how to price my packages? Like well I've got a basic idea on how I can price the hosting packages I would want to offer but my problem is that there might be other companies that will come and offer the exact same price or even cheaper and say that they are giving unlimited bandwidth. So I was thinking whether or not to stay with normal packages and prices or since I'm quite damn sure that most of the customers won't even use 5GB of the provided bandwidth is it a good idea to oversell and give them unlimited? or in other words unmetered? Personally I really hate overselling companies that offer unlimited plans so if I was actually going to offer unlimited bandwidth I would put it to unmetered not unlimited. The main reason for this is that what if I don't get any customers because they will see other's offering unlimited?

  2. #2
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    To start with you should price your packages so that you are covering your costs and making a profit.
    As for the unlimited, unmetered stuff..it's simply a personal preference. I would suggest that you steer clear of that route because there is no such thing as unlimited. Everything costs you something however small and you need to be compensated for that.
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  3. #3
    The biggest issue we have faced with the metered/unmetered bandwidth thing is that people in general don't want to be limited. While I don't have the exact numbers at my fingertips I feel very comfortable stating that 95% of our shared clients hardly use a gig or two of bandwidth. The other 5% we deal with.

    Just like emails/db's/addon domains/ etc people only use on avg less then 10 of the said "unlimited" features, however if you tell them they can only have 10 they will go somewhere else. On that one, I remember the debate I had with my business partner, had to pull the "whats the difference between 10 1MB databases or 1 10MB database?" There is no difference.
    Same with the bandwidth, sure your going to get clients that want to pull 500 GB's, you deal with them, you have your TOS/AUP ready, and you work with them, you upsell them.

    Same can be said with pricing, I had a client move away from us as he found another provider that was twenty five cents cheaper per month.

    Stick to your business model either way, you at the end of the day have to be happy with the model you picked.

    Just my 2 cents and ramblings.

  4. #4
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    I think unlimited relates to perception. When a prospect sees offers of unlimited space and bandwidth, do you think they subconsciously perceive lots of infrastructure backing up their site?
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  5. #5
    Unlimited ... niche ... how can you put those 2 words in the same sentence?
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  6. #6
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    Quote Originally Posted by Mat2009 View Post
    .So I was thinking whether or not to stay with normal packages and prices or since I'm quite damn sure that most of the customers won't even use 5GB of the provided bandwidth is it a good idea to oversell and give them unlimited? or in other words unmetered? Personally I really hate overselling companies that offer unlimited plans so if I was actually going to offer unlimited bandwidth I would put it to unmetered not unlimited.
    You are a little confused on the meaning of the terms you are using. Become familiar with the terms from a server management point of view before making these decisions. But you are not alone. Many of the hosts here are also as unfamiliar as you are -- that is because they have no clue what is happening outside of a control panel.

    Let's take the term "unmetered." Unmetered means "not measured." Don't go down that road with bandwidth unless you have managment control over the ports and switches. With diskspace, you are going to measure that (at least for internal purposes) whether or not you offer unlimited space; in this case "unmetered" would be a lie.

    Now, "unlimited." Unlimited merely means "no quota." It means "you get what you need without the limits imposed by an artificial/arbitrary quota." By "you" I mean: a web site suitable for a shared hosting environment. Since you won't have a quota you will need to monitor a user's usage to ensure they stay within the parameters of such a site.

    This requires tools not available in control panels or known to hosts that cannot manage a server without a control panel (lots of those here -- you can hear them scream: "there is no such thing as unlimited" every day like a religious mantra) You will need these tools to prevent customers from abusing your plan.

    In short, if you lack the knowledge and experience to offer hosting without a control panel (even though you will be using one), you probably should not be offering unlimited or unmetered hosting

  7. #7
    Thanks everyone for your advice, especially Collabora for clearing things up a little bit and well I know that unmetered means not measured but a normal customer in my opinion will be happy to see either unlimited or unmetered because to customers it's the same thing as long as they don't see any clear limits. I was only thinking about bandwidth thought not the space.

    @Logicidea

    My niche has nothing to do with unlimited hosting offers, please read the thread properly before replying. Thanks.

  8. #8
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    Quote Originally Posted by RubyRingTech View Post
    I remember the debate I had with my business partner, had to pull the "whats the difference between 10 1MB databases or 1 10MB database?" There is no difference.
    There can be a difference. 10 databases, so 10 different users, they do pay you 10$, 1 database, one single user, it pays you 1$. Difference is 9$ per month for the same cost.
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  9. #9
    @Quel, yes there can be at that rate, but the example was on the line of telling a customer that they can only have 1 DB vs the Unlimited DB's.

  10. #10
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    Even then, you have an opportunity cost. You loose the opportunity to leverage that customer.
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  11. #11
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    Quote Originally Posted by RubyRingTech View Post
    On that one, I remember the debate I had with my business partner, had to pull the "whats the difference between 10 1MB databases or 1 10MB database?" There is no difference.
    .
    That's like asking what's the difference between 10 1-bedroom apartments and 1 10-bedroom house. One serves 1 big family. The other 10 smaller families.

    With hosting, each "family" is an application. So there is very big difference

  12. #12
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    I'd much rather have 10 clients paying $10 each than 1 client paying $100.

    Your risk is much less having ten clients.

  13. #13
    To be honest, it really depends on your niche.

    For example, if you are targetting a "bridge club" niche market.. then you're most likely going to have customers who don't know what is the difference between a megabyte and a gigabyte. In that case, it would be silly to advertise your "disk space" plans to them.. since it isn't what they are looking for when signing up for a provider. Those type of people want to know if their website will always be working, and who they can call if they have a question.

    However, if your niche market is computer geeks.. then ya, it would make a lot of sense to have all the technicaly breakdown of your plans right there on the front page.

    So... in order to help you price your packages... I think it depends on the niche you have selected.

    In summary, if it's a non-technical market niche, then you can just make all your packages the same unlimited everything for disk/bw, and choose something else that is specific to the niche to differentiate. ie: If it's a car club niche, then maybe choose email addresses as the difference between accounts.

    I hope that makes sense?
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  14. #14
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    Quote Originally Posted by Mat2009 View Post

    @Logicidea

    My niche has nothing to do with unlimited hosting offers, please read the thread properly before replying. Thanks.
    Not to be rude but isnt offering unlimited and unmetered almost the same thing or unquoted?
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  15. #15
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    Since you say you have a niche..

    I say that you create packages based upon your needed profit to sustain and prosper the business.. and then go after those niche customers hardcore. Niche customers and niche industries tend to be willing to pay more to get their desired service/attention.

  16. #16
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    That depends..

    Quote Originally Posted by HostDiva View Post
    I'd much rather have 10 clients paying $10 each than 1 client paying $100.

    Your risk is much less having ten clients.
    If by risk you mean what happens if the one client leaves you.. then yes.. but you also gotta remember with your preferred model, you have to support 10 customers for the same cost as supporting possibly just 1 client. So it's all about what you like..

  17. #17
    Quote Originally Posted by mrzippy View Post
    To be honest, it really depends on your niche.

    For example, if you are targetting a "bridge club" niche market.. then you're most likely going to have customers who don't know what is the difference between a megabyte and a gigabyte. In that case, it would be silly to advertise your "disk space" plans to them.. since it isn't what they are looking for when signing up for a provider. Those type of people want to know if their website will always be working, and who they can call if they have a question.

    However, if your niche market is computer geeks.. then ya, it would make a lot of sense to have all the technicaly breakdown of your plans right there on the front page.

    So... in order to help you price your packages... I think it depends on the niche you have selected.

    In summary, if it's a non-technical market niche, then you can just make all your packages the same unlimited everything for disk/bw, and choose something else that is specific to the niche to differentiate. ie: If it's a car club niche, then maybe choose email addresses as the difference between accounts.

    I hope that makes sense?
    That's some very good advice, it makes a lot of sense and my actual target audience aka niche market is a non-technical one therefore mostly everything from what you've said would actually apply to me.

    Quote Originally Posted by JakeTheSnake View Post
    I say that you create packages based upon your needed profit to sustain and prosper the business.. and then go after those niche customers hardcore. Niche customers and niche industries tend to be willing to pay more to get their desired service/attention.
    That's something I took in mind myself too, so yes this will be helpful.

    Quote Originally Posted by darkeden View Post
    Not to be rude but isnt offering unlimited and unmetered almost the same thing or unquoted?
    Well yeah it is, I kinda got it the wrong way round well maybe not the wrong way round but the thing is if you offer your customers unlimited it sounds better to put unmetered which basically means there is no limit as to how much they can use from what is available in the actual host supplier where as unlimited gives the idea that you can have as much as you can use. Well I got it all confused so never mind, I just still seem to think that if anything would go wrong unmetered would be a better option rather then stating unlimited. I may be wrong, talking gibberish and unexperienced though so any advice is welcome.

    Overall I think I'm going to take a bit of mrzippy's advice and a bit of JakeTheSnake's advice where I will create a package which will give both the space and bandwidth that I can give in order to sustain the business and a package where there will be no limits in bandwidth therefore it will be a little more expensive, it will also have more features available in order to make it more attractive and sensible. I will be working with various niche markets where most of the people will not have any technical knowledge in the area of IT and furthermore Webmaster & Server skills.

  18. #18
    Quote Originally Posted by JakeTheSnake View Post
    If by risk you mean what happens if the one client leaves you.. then yes.. but you also gotta remember with your preferred model, you have to support 10 customers for the same cost as supporting possibly just 1 client. So it's all about what you like..
    This is a good view point too. And serving loads of customers with support can sometimes be no fun at all.

  19. #19
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    I would prefer 1 customer paying 100$ / month.

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