Should I lower my Prices?

F

FusedServers

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When I opened HostWisdom.com I was aiming to give quality Web hosting at an affordable price per month.

My plans start at 4.95 a month, I am wondering if thats to much to attract potential clients because I do not have reviews or anything like that. Even thought I offer 50% off recurring discounts I have not yet had one client. I was thinking about dropping my prices a couple of dollars to attract more people but do you think that would work?
 
Hostix said:
When I opened HostWisdom.com I was aiming to give quality Web hosting at an affordable price per month.

My plans start at 4.95 a month, I am wondering if thats to much to attract potential clients because I do not have reviews or anything like that. Even thought I offer 50% off recurring discounts I have not yet had one client. I was thinking about dropping my prices a couple of dollars to attract more people but do you think that would work?
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How long have you been "open" for? Getting first customers can be difficult, but once you have the initial ones, word of mouth and reviews certainly help.

Don't just lower prices as a desperate "knee jerk" reaction to get customers - I'm assuming you already costed out your sell price at business plan stage so lowering it can cause you other problems.

You mention that you offer 50% off vouchers - could this be seen as devaluing the product you are selling? We have offered vouchers in the past (10-20% off) but not all the time - 50% off recurring is a lot.

Steve
 
We have been open for about a month now. The 50% off is only for the first 1-2 poeple that sign up. Its not a coupon I will put out after the grand opening is over.
 
Our first couple of months were slow to be honest. Its to be expected in a market that is so flooded with web hosting companies.

Our prices were low to start, but to be honest if you intend to hire commission based sales reps you want your prices to be at a point where they can actually generate some income.

Keep your prices consistent. It only looks bad when a company continually adjusts prices.
 
It is really hard to compete with all the hosting companies out there. Until you get some customers who actually review your company, it will be a struggle to get some business.

That said, it does look bad if you lower your prices too much. As a webhost-hunter, I do enjoy looking at the cheaper hosts first- but that doesn't mean that I'm willing to become a client unless I'm sure that the hosting company is legit and won't shut down. Try to offer something that only few webhosts offer, or a temporary coupon code to promote sales.

I know that I was personally drawn to webhosts that offered either a free domain or the ability to register a domain from the webhost because it's very annoying to try to keep track of the domains I buy and having it done and ready on one host is useful to me.

Making yourself unique without costing yourself too much money is the key. Just look at what other popular webhosts offer and see if you can get creative to get your hosting going right!
 
some hosts offer ecommerce plans, wordpress plans etc. that are hosting with appropriate scripts pre installed so all the client needs is a domain name and if you get a domain reseller account then you can offer them too

but best is as i say create a plan that you can sell on ebay with limited plans offers, just so you can get your first few clients and then if they give good reviews others will follow
 
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My advice to you is to not lower your price to generate business. This will come back to haunt you months and even years from now. Once you devalue your costs, people refuse to pay the regular rates. I have this problem when I see people offering 75% off etc - tell me why I'll pay 100% next month when they were offering 75% off last month? That's the same question most people ask themselves too!

Now, regarding only being open for a month and not having visitors/clients - are you advertising? Are you *PAYING* for advertising, or just posting in forums? If you're posting in forums, are you competing against other low budget hosts - or even hosts that have been in business for years (or decades)?

I see too many new hosting companies trying to compete with the giants of the industry - you're not them, so don't try to be them or price like them. Your clients will appreciate it! If you're new to the business, I recommend NOT posting specials on various webmaster and hosting forums where you're the new kid on the block trying to get a piece of the pie. All that happens in those situations is that someone comes along, screams foul, and then slams you for being new in the business. I'm guilty of this practice when it comes to people offering hosting for $0.25 and $0.99 for unlimited hosting :)

So - should you lower your price to bring in new customers? No.
Instead, you should showcase a value added service that you can provide.
 
i agee that you should not lower your prices, but the ebay listings may work by saying its an opening offer special available for a month but limited to 12 accounts.

Also try and get an advert in your local papers or even try and get them to run a feature on your new business (most will do free features)
 
Your prices are already pretty low. I recommend first adding a way for potential clients to contact you for more information about your service. I took a look at your site and couldn't see any "contact us" information. That's a deal-breaker for many potential clients.
 
yes you need a contact us area. also i think in the USA as in the UK you legally are required to display your business name and registered postal address which you do not have.

another 2 things is implement a live chat and to look more professional get your WHMCS integrated with your website, if you bont want to integrate yet then if you are using the latest version 5.0.3 then change to the new clientarea rather than the old portal theme and build a knowledgebase
 
HostWisdom said:
We have been open for about a month now. The 50% off is only for the first 1-2 poeple that sign up. Its not a coupon I will put out after the grand opening is over.
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1 month? Prepare to have months and months without a single signup. I have been open 2 years and only have a few of signups a month sometimes none. Don't lower prices, work out how much each package costs you then your margins. Only once you have that figure update your prices.

One important thing, Hosting isnt a get rich quick scheme. It requires considerable investment in money and time otherwise you may endup like the other thousands of hosts that just close down after 3 months of not having a sign up.
 
PK-Host said:
1 month? Prepare to have months and months without a single signup. I have been open 2 years and only have a few of signups a month sometimes none. Don't lower prices, work out how much each package costs you then your margins. Only once you have that figure update your prices.
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this is what i suggest he design a small plan and list on ebay etc. so that he is not lowering his site plans, but attracting clients giving him a starting income and some reviews

PK-Host said:
One important thing, Hosting isnt a get rich quick scheme.
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I totally agree with this, i am surprised at how many posts i read on forums where people think hosting will make them rich. ive been hosting since 1999 and i am making a good living, but it took nearly 3 years before i started to make a reasonable profit
 
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On a slight tangent..

Do people actually buy Hosting off eBay? I have never given that a thought.

Ro
 
HC-Ro said:
On a slight tangent..

Do people actually buy Hosting off eBay? I have never given that a thought.

Ro
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yes i know a few hosts that make good money from ebay sales, we run specials on ebay about twice a year and it works, you just have to compete with what we call kiddie hosts listing reseller plans for $2 a year
 
Thanks,

I will have to look into eBay fees and perhaps list something as a feeler.. I dont think I have even been to the eBay site for like 8 years =)
 
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