Must read for web hosting entrepreneurs!

businessAre you seriously interested in joining the web hosting market? Don’t have a ton of money? Is your plan to start small and grow?

There’s always room in this industry for new web hosts

Consider this. Every week I used to purchase 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. You’ll 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.

business planMy Advice

Don’t 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 on web hosting forums comparing domain name services where the original poster’s focus is on price rather than stability. Realistically, unless you’re 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, and 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 registrar than your reseller host, then you can simply point your nameservers to the new host and you’re good to go.

I’d 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.

MarketingMarketing 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 it’s difficult at times to see beyond your own work. Solicit opinions from others in the industry. There are 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 is a great starting place to analyze traffic to your site.

Local audienceAre you marketing to a local audience?

One marketing strategy is to obtain a targeted list of newly formed businesses, generally 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 you’re still unable to reach them, consider a quarterly direct mail post card campaign. If you haven’t 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 you’ve considered door-to-door 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 company’s info displayed – why not have it be yours?

Another great door-to-door promotion was recommended to me by a very successful sales representative. She has prospects pick a card from a deck, then posts a winner for the matching card weekly on her website’s blog. They’ll absolutely remember you and likely visit your site, increasing your odds of making that sale.

Don’t just leave your business card or literature. Most likely, it’ll find its way to a circular recycling bin. Be unique in your approach. Set yourself aside from your competition. And smile.

NetworkingNetworking

So many entrepreneurs in this business opt to go it alone, or with the aid of one or two technicians. Networking is a very necessary ingredient to jump-start 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 – we’re 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 with 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 clienteles’ s ISP went under. Lay the groundwork for your success by maximizing your connections in the industry.

Merchant Account

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. Stripe, for example, deposits funds to your business banking account in two business days.

Accounting Billing Software

Of course you’ll need some type of billing software, and here again, there are lots of options. Some are open source while most are commercially available. If you’re 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.

Control Panels

cPanel is the most popular control panel offered by many web hosts as part of their package, although there are alternatives such as Direct Admin.

Summary

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

Brought to you by ProlimeHost

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Steve

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