“No thanks, I don’t want more money,” said no one, ever. Earlier, we wrote a how-to guide about all the lucrative reasons to get into the hosting business and the first 5 steps to getting started. But now that your business is up and running, how do you increase your hosting revenue?
Like all industries, the hosting business has its own collection of tricks, techniques, and best practices for maximizing returns… but some aren’t as readily apparent as others. That’s why we’ve compiled this list of 7 master techniques for improving your hosting business. We’ve broken them up into 3 categories — Company Strategy, Marketing Your Hosting Company, and Product Packaging — so you can chose the ones most relevant to your company goals.
1. Niche Specialization
There’s no shortage of competition in the hosting industry, so you need to set yourself apart from any way you can. One of the best ways to stand out is by specializing in a specific niche. Isolate online industries that are underrepresented; specialty retail stores and particular online interest groups all need hosting, too!
This shouldn’t be in name only. Provide extras and features that these specific niches need, but your competitors don’t offer.
Niches can be any community group. The most obvious are industry-specific: for example, you could provide hosting for homemade craft online stores, and offer site templates with a “folksy” themes.
Niches can also be client-specific. You could target technophobes, for example, and offer packages that handle all the computer work for them so they don’t have to.
You can even target technology-specific niches, i.e., companies using Drupal or Joomla, with appropriate customer service technicians to match.
One thing to keep in mind when choosing your niche is your personal network. It’s easier to build off a community you’re already a part of than to start from scratch. You can leverage your network of contacts to spread awareness and enable link and/or article exchanges, as we’ll explain below.
2. Update Your Server Provider
Increasing revenues is also about cutting costs. If you’re a hosting reseller, choosing a new server provider can improve your bottom line with no extra effort on your part. It’s just a matter of finding the best plan for your needs.
First things first, you need to estimate your hosting needs.
- How much web traffic volume do you expect? Will that require VPS or Dedicated Hosting?
- Do you require extra services?
From there, you want to analyze your top options with a critical eye — choosing the right server provider will be the backbone of your hosting business, like a manufacturer choosing the highest-quality materials.
We’ve previously written about the 3 qualities to look for in dedicated server hosting, but we’ll summarize them here:
- Hardware: Make sure your provider’s physical hardware backs up their promises. Pay attention to their OS offerings, RAM/CPU, bandwidth, and uplink port speed.
- Cost: Compare different plans to make sure you’re not overpaying. Consider how much they charge for their extra features and what kind of service level agreement (SLA) they offer.
- Support: Customer service is crucial to the hosting business. “Test drive” their support to make sure it’s accurate, fast, and friendly.
Following our own advice, we fine-tuned our packages to cater to different types of resellers… and it worked for us in increasing our hosting revenue!
Marketing Your Hosting Company
3. Think Outside the Box with Advertising
It’s normal for hosting companies to advertise online, so again you have to separate yourself from your competitors. Think up new avenues to advertise and reach new audiences.
This isn’t just about advertising in new places, but in new ways. Advertising has come a long way in the last ten years, and methods like YouTube advertising, novelty apps, or sponsored content can escape the minds of traditionalists.
This ties in directly to our first point about niche-targeting. If you have a specialized audience, you can use more effective — and cheaper — methods of advertising than blanket campaigns.
For example, let’s say your niche is small businesses who use Drupal. Consider a social platform like Facebook Ads, which allows you to granularly target your audience. You can single out people who show interest in Small Business Ownership and Drupal, and customize your ads with a message like “Slow Drupal Sites = Lost Business. Checkout Acme Hosting Today for 2X the Speed!”
4. Complement Advertisements with Content Marketing
Content offers an array of advantages beyond mere reading material. They do wonders for SEO, social media sharing, customer engagement, and the time visitors spend on your site. They’re also less expensive than traditional advertising.
Just to be clear, content marketing encompasses:
- Blog articles
- White papers
Aside from taking advantage of strategic SEO keywords, content marketing works best when it appeals to what your target customers want to read or watch. One of its goals is to get shared on social media for more publicity.
Knowing what kind of content to create requires knowing your audience. Analyze which topics perform well and which flop. See what your community is talking about in their own forums. Follow them on social media to see what other content they post and share.
5. Articles Exchanges for Exposure and SEO
It’s not just your own blog that can increase your hosting revenue. Forge alliances with other companies and sites — even across industries — and participate in mutually beneficial article exchanges. In other words, post articles on each others’ sites.
For starters, this increases your exposure by spreading brand awareness to a new audience on a new site. Other companies within your niche have already built up a pre-existing pocket of your target customers; all you have to do is tap into them with a stunning and memorable piece of content.
On a technical level, backlinking to your site on an external site improves your results with the Google search algorithm. Essentially, the more links you have to your site on external sites, the higher your search rank becomes. The effects are magnified when links come from the same or related industries.
For a hosting company, a backlink on a tech news site will mean more to search engines than a backlink on, just as an example, a sports news site. Search engines emphasize relevance: if a tech news site — especially a popular one — references and links to you, it validates your place within the industry… at least to search algorithms.
Earlier when we talked about finding specific people through Facebook ads, we were describing “microtargeting,” the marketing strategy of reaching out to specific businesses and offering your services directly. While you’ll quickly run out of contacts you know personally, social media and targeted ads give you access to every corner of the internet.
Microtargeting can work in two main ways. First, you can specify who sees your ads to avoid wasting money on advertising to uninterested parties. Again, Facebook Ads are great for this: they allow you to filter people by Likes, job title, location — practically any data in people’s profiles.
Second, with a little extra effort, you can reach out personally to specific companies you think could benefit from your hosting services. This is where being part of a niche community comes in handy. You’d be surprised at how many online friends you can make after a few months of participating in community forums.
You can even take a more straightforward approach by cold calling, emailing, or direct messaging. LinkedIn is great for microtargeting in B2B industries like hosting, allowing you to filter searches by company size or type of business.
7. Sell Extra Features
If you’re offering a feature that genuinely helps your customers out, they won’t mind paying a little extra for it. You could sell the feature on its own, or include in it a slightly pricier package deal. If the feature is enticing enough, you could mold all of your pricing plans around it.
There are two main schools of thoughts on features. The first is a data-driven approach. You can ask current customers or target customer groups what kinds of additions they’d like to see. This can be done easily if you have a mailing list by sending out a poll or questionnaire. You can even solicit suggestions on social media.
The second approach is purely innovative. You are the first company to think up a feature, or the first company within your niche to offer it. Like the first approach, this necessitates knowing your audiences well. The difference is, instead of asking them directly, you have to anticipate what they want. Customers can’t always put into words what they’re thinking, and sometimes they don’t even know what they want it until they see it.
Features can distinguish between different pricing plans and even justify markups. Try incorporating catchy and clever names to features and their corresponding plans to draw attention.