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  Post #1 (permalink)   03-10-2009, 08:19 AM
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Are you seriously interested in joining the web hosting market? Donít have a ton of money? Is your plan to start small and grow?

Thereís always room in this industry for new web hosts

Consider this. Every week I bought a targeted list of 150-200 new businesses in my area. At least 80% of them did not have websites or hosting. Multiply how many times in how many places worldwide that this happens week in and week out. Youíll never run out of prospects.

It does take some investment in time and money, but it can be done and is being done by new entrepreneurs every day. The ones who survive are normally those who have enough financial resources to withstand their first year in business.

My Advice

Donít attempt to wing it! Write a comprehensive business plan which includes disaster recovery and business continuity scenarios. Search the Internet, on Google and on forums for reseller plans with hosts that can be upgraded to a VPS or dedicated server. Define your market niche and develop your business plan to close those prospects.

Domain Name Registration

I read a lot of threads comparing domain name services where the OPs focus is on price rather than stability. Realistically, unless youíre planning on registering hundreds or thousands of domain names, price should be a secondary consideration. Choose a domain registrar with a reputation for great service, then price.

Should you register your domain name with your reseller host? The general consensus is NO. Why not? Too many small hosting companies encounter problems with their original host, then decide to transition to a different host only to find their domain name locked in dispute. If you have your domain name with a different provider than your reseller host, then you can simply point your nameservers to the new host and youíre good to go.

Iíd also suggest that you provision your domain name to auto-renew. Forums are full of horror stories of expired domain names held hostage or sold at auction.

Marketing Your Business

The first consideration should be the design of your website. Be sure it represents your niche. So many new web hosting providers use a cookie cutter approach that never gets noticed, and they post threads months later wondering why? I understand itís difficult at times to see beyond your own work. Solicit opinions from others in the industry. There are literally hundreds or thousands of forums filled with entrepreneurs just like yourself who are willing to provide honest opinions of your design, and give thoughtful insight and recommendations. Why try to reinvent the wheel when so many are willing and able to freely help?

Another consideration is Search Engine Optimization

Volumes of information have been written about Search Engine Optimization (SEO) and opinions on how to best approach this vary widely. Some will recommend starting by reading published books, but the general consensus is to follow the major search engines (current) advice because SEO evolves dynamically. What worked yesterday may not work today. What always worked and still works is relevant content and well designed code. Use cascading style sheets, check for browser compatibility, track the keywords that surfers enter to find your site, then tweak your site as needed. Too many small web hosts pour hours of original effort into their sites, but never update anything but price (running sales). The primary enemy of sales is complacency. Google analytics and awstats are great starting places to analyze traffic to your site.

Are you marketing to a local audience?

One marketing strategy is to obtain a targeted list of newly formed businesses, normally at 10 cents per business - then direct mail them an offer and follow up with a phone call within three days (provided there is a phone number). Always leave a voicemail if you cannot reach them. Schedule follow up calls (up to 3 over the period of a couple of weeks), then if youíre still unable to reach them, consider a quarterly direct mail post card campaign. If you havenít budgeted for an aggressive advertising campaign, growing your new business will be that much harder.

Personalize your initial direct mail offer with your picture, and sign it in blue ink. With each new client, immediately ask for referrals and testimonials. And be sure to send them personalized thank you cards.

If youíve considered on-site sales, consider leaving personalized scratch pads, with your picture at the top left and contact info at the bottom. Scratch pads are relatively inexpensive and can be found on every desk worldwide with some companyís info displayed - why not have it be yours?

Another great on-site promotion was recommended to me by a very successful sales rep - she has prospects pick a card from a deck, then posts a winner for the matching card weekly on her websiteís blog. Theyíll absolutely remember you and likely visit your site, increasing your odds of making that sale.

Donít just leave your business card or literature. Most likely, itíll find its way to a circular recycling bin. Be unique in your approach. Set yourself aside from your competition. And smile.

Networking

So many entrepreneurs in this business opt to go it alone, or with the aid of one or two techs. Networking is a very necessary ingredient to jumpstart and sustain your business.

I recently attended a conference sponsored by Yellow Tie where the guest speaker mingled with the attendees minutes prior, then started by asking everyone he had talked to, to stand up - weíre talking twenty to thirty people he had never seen or met previously. He then proceeded to ask them to sit down if he remembered their name and association - and one-by-one he called out all but two. How many times do you meet a prospect, exchange cards, chat briefly, then five minutes later cannot remember their name? Networking is a learned skill perfected via practice.

Team up a web designer, or two or ten. Possibly a business consultant? I personally recall a sales rep that networked with an IT consulting firm that directed thousands of dollars her direction when their existing clientelesís ISP went under. Lay the groundwork for your success by maximizing your connections in the industry.

Merchant Account

A recent Google search for Merchant Account Providers produced 744,000 results. Accepting credit cards is absolutely necessary, but through which merchant provider? My advice is to check with your bank or financial institution first to ask their recommendation. PayPal is a great starting point. Different gateways allow you to receive your funds on varying schedules.

Billing Software

Of course youíll need some type of billing software, and here again, there are lots of options. Some are open source while most are commercially available. If youíre starting with a reseller plan from a web host, that plan probably includes pre-installed billing software. Be aware that open source software may have limited features as compared to a program such as WHMCS. Do you need all of the bells and whistles? As you grow, how easily could you transition from open source to WHMCS? If there are demos available, try them. Get a feel for what best works for you.

Should you offer Live Chat Support

If you have the time and resources to interact with your prospects online, live chat services can certainly help convert prospects to clients. A great place to compare todayís live chat services is http://live-chat-support-software-re...tenreviews.com.

Control Panels

While cPanel is a very popular control panel offered by many web hosts as part of their package, DirectAdmin is a feature rich, fast and stable alternative.

What makes DirectAdmin different?

Ease of use. DirectAdmin is the easiest to use control panel, period.

Speed. DirectAdmin is programmed to be the fastest running control panel available.

Stability. DirectAdmin avoids downtime by automatically recovering from crashes.

Summary

Web hosting is a highly competitive industry, but there is certainly room for new entrepreneurs. Hopefully this helps you with some insight. Cheers

- Steve
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  Post #2 (permalink)   03-10-2009, 01:58 PM
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Really loved your way of writing. It will be motivating to the new webhosters and those who are thinking of joining the web hosting business.
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  Post #3 (permalink)   03-10-2009, 04:43 PM
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Wow steve, you just keep out doing yourself Thanks for the share.
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  Post #4 (permalink)   03-12-2009, 08:41 PM
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Cheers man, ur guide might help me out a bit!
 
 
 


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  Post #5 (permalink)   03-12-2009, 08:49 PM
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what a great article almost like a business plan. Very help to people who will be starting out in the web hosting industry. +10
 
 
 


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  Post #6 (permalink)   03-13-2009, 09:25 AM
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It is a great article, nice work
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  Post #7 (permalink)   03-13-2009, 09:45 AM
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Great article and I agree with your business ideas.

However, web hosting affiliate programs pay $50 - $120 per sales. It's not a simple job but it seems more profitable to me. Given such situation, do you think it's a good idea to start off as a reseller rather than just a sales?

What's your opinion in this?
 
 
 


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  Post #8 (permalink)   03-17-2009, 10:45 AM
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Thank you for the tips. It is really worth the reading. Marketing web hosting was and still a big issue in the industry.
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  Post #9 (permalink)   03-17-2009, 01:11 PM
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Well, those that pay $50-$150 per sale is a one-time payout. I would rather have a recurring payout as in the future I would make more than $50-$150.
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  Post #10 (permalink)   03-17-2009, 02:00 PM
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Quote:
Originally Posted by monsterjerry View Post
Great article and I agree with your business ideas.

However, web hosting affiliate programs pay $50 - $120 per sales. It's not a simple job but it seems more profitable to me. Given such situation, do you think it's a good idea to start off as a reseller rather than just a sales?

What's your opinion in this?
In the long run (running a profitable, stable business), which revenue base produces more net income - one time affiliate fees or recurring monthly charges? How long will your customers continue paying you for services if you deliver both great uptime and raving customer support?
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  Post #11 (permalink)   03-18-2009, 04:37 AM
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Great advise.
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  Post #12 (permalink)   03-29-2009, 01:41 AM
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Great Tips, Good work mate
 
 
 


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  Post #13 (permalink)   05-08-2009, 11:28 AM
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wow mate, really nice job!
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