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-   -   Do you reward existing customers? (http://www.hostingdiscussion.com/customer-service-support-issues/38105-do-you-reward-existing-customers.html)


MarkPoppen 10-20-2014 04:18 PM

Do you reward existing customers?
 
I read this on another hosting forum and thought I'd ask it here as well.

It seems like a lot of hosts (if not all) spend a lot of time recruiting new customers by throwing discounts at them for signing up, but what if you're a loyal customer for several years, always pay your bills, and never bother customer service with silly questions? Do you get a discount on renewals?

I've been looking into this myself, because I always think it's nice to see a discount as a token of appreciation for being with a company for a long time.

You could give discounts to everyone who's been a client for longer than X months, but then there are a few loopholes.
For example, what if it's a customer that's very demanding, not an advocate or is always late with payments? Do you give them discounts too?

easyhostmedia 10-21-2014 02:19 AM

It is strange one as if you 'give discounts to everyone who's been a client for longer than X months' then you set a precedence that all clients for that time are entitled to the discount even if they are always late payers or demanding.

It is better to just be more lenient with long term clients

MarkPoppen 10-21-2014 04:14 PM

Quote:

Originally Posted by easyhostmedia (Post 181342)
It is strange one as if you 'give discounts to everyone who's been a client for longer than X months' then you set a precedence that all clients for that time are entitled to the discount even if they are always late payers or demanding.

It is better to just be more lenient with long term clients

Right, but if a customer has been with you for years, being an advocate for your services, how do you reward them? They always miss out on the "50% discount (or whatever)" you're giving to new customers, but your existing customers are the ones you need to nourish, no?

easyhostmedia 10-21-2014 04:21 PM

Quote:

Originally Posted by MarkPoppen (Post 181352)
Right, but if a customer has been with you for years, being an advocate for your services, how do you reward them? They always miss out on the "50% discount (or whatever)" you're giving to new customers, but your existing customers are the ones you need to nourish, no?

I think the Hosting Industry is not on its own on this issue. When my van come up for insurance renewal i did an online check to see if i could get a cheaper deal and guess what if i took out a brand new policy as a new customer with my current insurance company i would get exactly the same insurance cover 40% cheaper than my renewal quote

6LAYER 10-22-2014 11:25 AM

Instead of just new customers, we focus on both current and new customers to enjoy the offer and promotions

Rado_Ch 10-22-2014 03:06 PM

It is a really tricky subject and different hosts treat it differently. Generally you are absolutely correct - the loyal customers is what keeps the hosts afloat and they should be treated with the utmost respect and gratitude. So naturally, hosts should think of ways to express that. Renewal discounts, feature discounts that they will only see in their Client Area, giveaways and contests - there are quite a lot of options.

There is one thing I believe you are in the wrong tho - EasyHostMedia experienced it with his van insurance and the same type of thinking applies to many clients in the hosting business - discounts for new and existing customers. As you may well know, the bonuses for the loyal clients are somehow lower than the ones for new ones. Seems unfair, right? Well...to an extent. I actually believe this is quite justified. Here is why.

Lets say that you are a web host and (in your mind) provide a quality service at a good price (like most believe). Now - would you be able to sell accounts more easily to a person completely unfamiliar with your service, who just have to believe your words, or to one that is well aware how good your hosting and support is? That is the point of the introductory bonuses - giving a person who doesn't know you, a taste of your quality, an opportunity to test you for a longer time and not lose much. You should well know that often the prices for acquiring a new customer are ridiculously cheap, often cheaper than the real value of the package. And that is the cornerstone - knowing the real value of your packages and knowing how to back up that claim. Because if you give such low promos for both new and existing customers simply means that you will be disappearing after some time, unable to keep up with your bills. If your loyal customers really like you as a host they should well understand that, its basic Commerce 101.

That being said, again, I am all up for keeping loyal customers happy too. Its just that this does not necessarily be expressed with huge discounts. Keeping a great customer service, expanding, improving, innovating are just a few things that many people out there look for and will make them satisfied. :rolleyes2

easyhostmedia 10-22-2014 03:16 PM

I often give loyal clients extra space/bandwidth without charging them extra.
but you have to understand that you are running a business and the point is to pay your bills and make a profit, as Rado_ch says if you give low promos all the time then you will soon be out of business

MarkPoppen 10-22-2014 04:52 PM

@Rdio_Ch That depends. If it makes the difference between keep a client and losing him because he can get a better deal elsewhere, you're better off giving a discount than to lose the client completely.

I'm just looking at it from a customer's standpoint, because I've been one for years before I got in the hosting business. Something Godaddy did/does really well, is retain customers by giving them discounts in pretty much every renewal email they send. "Oh, 20% off? Might as well stay" instead of "I wonder if I can get a better deal elsewhere"..

I'm really on the fence on this topic. Obviously, nobody is in business to lose money, but are you losing less by diving a (small) discount on renewals?

edigest 10-23-2014 08:32 AM

In general, my clients are not price sensitive since I've never been a "cheap" hoster so I tend to not worry about them looking for a "better deal."

But on my 10-year anniversary I gave everyone who had been with me for a decade a free year of hosting. That was pretty well-received. :D

easyhostmedia 10-23-2014 08:55 AM

on our 10th Anniversary i gave all clients 6 months free hosting and those that had been with me for the decade also got a bottle of bubbly.

Still not decided what to do in December for our 15th Anniversary

MarkPoppen 10-23-2014 10:58 AM

Quote:

Originally Posted by easyhostmedia (Post 181412)
on our 10th Anniversary i gave all clients 6 months free hosting and those that had been with me for the decade also got a bottle of bubbly.

Still not decided what to do in December for our 15th Anniversary

Organize a Christmas party and invite all your clients.. BYOB ;)

easyhostmedia 10-23-2014 11:15 AM

Quote:

Originally Posted by MarkPoppen (Post 181419)
Organize a Christmas party and invite all your clients.. BYOB ;)

would not work as clients all over the world

Artashes 10-23-2014 12:17 PM

I am surprised no one talked about it yet, but how about instead of giving a monetary discount which wouldn't mean much to me personally (I talk only as a client), you put those marketing dollars into upgrading the equipment I am hosted on. HandsOnHosting was the first company that I was with that used to do that - always improving the server specs, without me asking. With time, technology improves and becomes cheaper, so why not do something like that. A client will not only appreciate the actual value provided, at no additional cost, but he will see proactive attention that is given in provided service, which to a client like me is the most important factor in securing me for a very long time. That kind of attention will eliminate ANY need for me to look elsewhere even in times of trouble.

easyhostmedia 10-23-2014 12:32 PM

I always look at ways to improve servers and will improve them without asking extra from clients.

Rado_Ch 10-23-2014 02:56 PM

Quote:

Originally Posted by MarkPoppen (Post 181397)
@Rdio_Ch That depends. If it makes the difference between keep a client and losing him because he can get a better deal elsewhere, you're better off giving a discount than to lose the client completely.

I'm just looking at it from a customer's standpoint, because I've been one for years before I got in the hosting business. Something Godaddy did/does really well, is retain customers by giving them discounts in pretty much every renewal email they send. "Oh, 20% off? Might as well stay" instead of "I wonder if I can get a better deal elsewhere"..

I'm really on the fence on this topic. Obviously, nobody is in business to lose money, but are you losing less by diving a (small) discount on renewals?

Oh, don't get me wrong, I never stood against bonuses for loyal customers, of course its better to give a discount and keep the love. I am talking about a specific bunch of clients who are well prepared to constantly jump hosts looking for the best deal - the type of "How come I see a 50% discount on your website but I only get 30% off my renewal. Why shouldn't I just cancel my account and create a new one?". Putting myself in the clients shoes is something I do on a daily basis (don't we all) but sometimes the opposite has to be done so the client can understand that getting great service and support does have its costs and they are still way lower than signing for a $1 host and losing clients constantly because of downtimes.

The same I implied earlier and later Artashes built on - innovations and upgraded services. Those also come at a cost and even so this cost very rarely reflects as a higher price for the end customer. So its really a two-way process - its perfectly natural to have some demands, but you should also give appreciation where appreciation is due :rolleyes2


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