Howdy, Stranger!

It looks like you're new here. If you want to get involved, click one of these buttons!


What do you consider acceptable increase in pricing?
New on LowEndTalk? Please Register and read our Community Rules.

All new Registrations are manually reviewed and approved, so a short delay after registration may occur before your account becomes active.

What do you consider acceptable increase in pricing?

Just curious, if a vendor emails you saying they are increasing prices. What is an acceptable percentage before you tell them to f-off (or as some do, complain here on LET)?

Comments

  • MasonRMasonR Community Contributor
    edited July 2017

    @der_wolf said: or as some do, complain here on LET

    Shit. I've seen people here freak out over the smallest of price changes. Some people think they are guaranteed the price they signed up for for the rest of their life. Tell them they have to fork over an extra dollar a year and their head explodes.

    Edit:

    I think the main thing is communication. If I'm told in due time that a price change will be occurring in the future and how it will affect me, I'm much more likely to be fine with whatever the price change is. At a minimum give me at least a month to decide if I want to keep the service or find an alternative.

  • ClouviderClouvider Member, Patron Provider
    edited July 2017

    That depends a lot, but I find the increases by the inflation / RPI to be acceptable and anything above that only if there's a reason for that.

  • sanvitsanvit Member

    Well, for me $20 -> $24 /yr seems acceptable(or around that pricing), other than that, nope(unless provider provides either a prepay option to renew at old price for X years, etc.)

  • For me that would completely depend on how the prices are after the increase. If the prices are still reasonable I'm fine with them.

  • MasonR said: I think the main thing is communication

    This. Let me know at least a month in advance, some loyalty perks like 5GB more disk doesn't hurt either :P

  • Not more than 15%.

  • raindog308raindog308 Administrator, Veteran

    sanvit said: Well, for me $20 -> $24 /yr seems acceptable(or around that pricing), other than that, nope(unless provider provides either a prepay option to renew at old price for X years, etc.)

    That's 20%...a huge jump percentage-wise.

    Prices should trend down over time because equipment and network costs trend down over time. Sometimes it's "more for the same price" - e.g., DO/Vultr/Linode keeps the same prices but resources go up over time. But raising prices on commodity services is pretty hard to justify.

    Clouvider said: That depends a lot, but I find the increases by the inflation / RPI to be acceptable and anything above that only if there's a reason for that.

    I know what you're saying but (a) inflation has been historically extremely low over recent years, and (b) IT is kind of anti-inflation in the sense that every year, you can buy more for less.

    Software is an exception to this (though what you get in current Microsoft Office (as an example) dwarfs what you got in Word 98 even though the price is lower...) but most LET hosts aren't selling software products.

  • BradyHBradyH Member, Host Rep

    Really that is a hard one. I for one have never gone and increased price on current customers.

    Now I have gone and increased pricing before on the site by 3% for any new customer.

    I look at it this way. If I go buy a car today i don't expect the dealer to come back and raise the price of my car in a year because it now cost more. That's for me I just don't see how raising the price on current customers are fair.

    The only way I could see doing this is if they had a promo code and it was marked only good for x number of time. I would rather keep the customer at the lower price than try and go and raise the price and get bashed over raising pricing or customers leave. Then raising your pricing did not help you out any.

    anyway that is my 2 cents on it.

  • deankdeank Member, Troll

    Really depends on how their mind works.

    Some go absolutely livid over a dollar increase. Some don't care. In general, LET crowd belongs to the former.

  • jarjar Patron Provider, Top Host, Veteran

    Can't go with any set figures. I'm out the moment it costs more than I'm willing to pay for it. What I'm willing to pay varies based on how useful and how replaceable it is.

    Thanked by 2Ole_Juul netomx
  • NekkiNekki Veteran

    Context is important.

    If a host provided an excellent service at a ludicrously low price and then held their hands up and admitted they'd got the pricing wrong, I'd consider any price increase on it's merits and make a decision based on whether I was still getting what I felt was value for money, even if that increase was to double the price.

    On the other hand, an arbitrary minor price increase of a service with no explanation and no changes since the original purchase to justify the change may well end up getting cancelled.

    I don't like feeling as if I'm being taken advantage of, and it's for that reason I cancelled an excellent OVH dedicated special a while back, as they arbitrarily increased the price 'because of brexit' despite their being little financial justification (in my eyes) for doing so.

    Thanked by 1Falzo
  • ZerpyZerpy Member

    @raindog308 said:
    I know what you're saying but (a) inflation has been historically extremely low over recent years, and (b) IT is kind of anti-inflation in the sense that every year, you can buy more for less.

    Yet RAM/SSD/NVMe related hardware prices increase over the last period - despite innovation, the per gigabyte price has gone up a lot more than it should do.

    We also have to take into account that a lot of providers are switching from spinning rust (with maybe SSD caching) to full SSD/NVMe - and the cost per gigabyte is a lot higher than the rust.

    So in fact - the prices do decrease in terms of hardware - so I wouldn't really say anti-inflation.

    Also as far as I know - running a decent hosting company with decent support and services requires people - and people are by no means having anti-inflation - as inflation happens in a country, it also have to be justified in the employees salaries (I'd as an employee expect to get a salary increase if there's inflation) - this increases cost, the increased cost can either mean a slight price increase or less profit for the provider, and with the already unrealistic pricing that some companies do - then I can see that it sometimes can be hard as a company to not increase the costs.

    But sure :-) anti-inflation.


    Personally many years ago, when I started out - I quickly realized that my pricing wasn't realistic to the services I provided - having a bunch of customers, I took the chance of increasing my prices by about 330% (shared hosting) - I didn't lose a single customer, and it actually only increased my sales because for a bunch of the customers I targeted they suddenly saw that it was a lot more realistic pricing, thus they could put more trust.

    Did I justify it? Nah, I just admitted to the customers that my pricing was wrong.

    1st jan 2018 - I'll perform another increase for the first time in 6 years - a small 4% increase, it does however result in every customer going to full NVMe storage and a bunch of other features.

    Sure the 4% won't cover the additional cost of adding full NVMe storage, but it does help on the bottom line when you have enough customers.

  • I think it's very hard to say, for example a jump from $20 a year to $24 a year is a 20% increase, but if I were paying $1000 a year for a service, which had a 20% increase and therefore went to $1200 a year, I probably wouldn't be happy.

    For me it entirely depends on what exactly the service is, whether the new price is affordable, how the change is communicated and how much advance notice I get, and whether the service is actually worth the new amount i'd be paying.

    Thanked by 1Clouvider
  • no more than 90%

  • WSSWSS Member

    It really depends on the service. Until this year, I had the same virtualhost provider for over 10 years. However, in those 10 years, the pricing didn't adjust accordingly- in fact, they decided they needed $12/mo for 250MB storage with 6GB transfer. Needless to say, I'm sure plenty of people jumped ship before I did- but I couldn't justify nearly $150/yr for that when I could get my own damn colo for comparable pricing.

    Now @AnthonySmith recently cited expenses and overhead for the reason of #1/yr jump on his cheapest NAT VPS. That may be a 33% increase, but it's still hardly anything for what the overall cost is. Needless to say, I'd be happy to pay 5.

    Thanked by 1Ole_Juul
  • AnthonySmithAnthonySmith Member, Patron Provider

    WSS said: Now @AnthonySmith recently cited expenses and overhead for the reason of #1/yr jump on his cheapest NAT VPS. That may be a 33% increase, but it's still hardly anything for what the overall cost is. Needless to say, I'd be happy to pay 5.

    yeah just to be clear for context this was the equivalent of 0.04 cents p/month increase :)

    Thanked by 2AuroraZ WSS
  • @AnthonySmith said:

    WSS said: Now @AnthonySmith recently cited expenses and overhead for the reason of #1/yr jump on his cheapest NAT VPS. That may be a 33% increase, but it's still hardly anything for what the overall cost is. Needless to say, I'd be happy to pay 5.

    yeah just to be clear for context this was the equivalent of 0.04 cents p/month increase :)

    The PayPal fees eat it up anyway :P

  • AnthonySmithAnthonySmith Member, Patron Provider

    doghouch said: The PayPal fees eat it up anyway :P

    Well with WHMCS, card processing and PayPal price/fee changes in a short period of time I don't think it is unreasonable to raise prices on a none profit product to cover that :)

  • randvegetarandvegeta Member, Host Rep

    In general, hardware prices do trend down over time, but this has not really been the case for the last 2 - 3 years. RAM prices have been on the rise, SSDs are still way more expensive than HDDs, and the trend is to switch from HDD to SSD, and CPU prices have sort of remained the same.

    But most companies do not spend most of their money on hardware. Man power typically is the largest cost of any company, and there are other things like rent, power, bandwidth, IP rentals etc.

    The price of each of these varies greatly between different markets. My company operates in both HK and LT and we have widely differing costs, and this affects how we price our services differently. You cannot just look at the cost of hardware.

    Some providers may be more sensitive to external factors than others. In HK, property literally cost 25X more than our LT property, so it has a much greater baring on our HK pricing than it does for our LT pricing. So you need to consider many factors in the given market to determine what is a fair price increase.

  • SplitIceSplitIce Member, Host Rep

    For larger stuff CPI or changes with reasonable justification (e.g taxation)

    For smaller stuff I guess I care less, provided the service is worth the $$.

  • YmpkerYmpker Member

    der_wolf Did you ever play the game Stronghold Crusader? Your name reminds me of that :)

  • 33.3...% increments are fine.

  • WSSWSS Member

    @AnthonySmith said:

    WSS said: Now @AnthonySmith recently cited expenses and overhead for the reason of #1/yr jump on his cheapest NAT VPS. That may be a 33% increase, but it's still hardly anything for what the overall cost is. Needless to say, I'd be happy to pay 5.

    yeah just to be clear for context this was the equivalent of 0.04 cents p/month increase :)

    Capitalism is a curse! I wasn't trying to single you out, or anything.. It was just an example of how not all price increases are just willful appropriation of the client's money.

    Thanked by 1AnthonySmith
  • deankdeank Member, Troll
    edited July 2017

    Well, if a bottom barrel host raises their price to survive, we will see threads wanting to find an identical deal. Some kid, wanting to grab any clients at any cost, will offer a similar deal and the circle continues.

    It's never ending circle and nobody learns anything from it.

  • WSSWSS Member

    @deank said:
    Well, if a bottom barrel host raises their price to survive, we will see threads wanting to find an identical deal. Some kid, wanting to grab any clients at any cost, will offer a similar deal and the circle continues.

    It's never ending circle and nobody earns anything from it.

    Fixed that for you.

  • EdmondEdmond Member

    Personally a few dollar's increase on the next bill (not charge me more when I haven't used up my year) is alright, but I tend to switch as soon as I see a cheaper option when it's nearing the end of the billing cycle. Really hosts shouldn't be increasing current customer's pricing unless it turns into they losing money to keep the customer.

  • yokowasisyokowasis Member
    edited March 2018

    @MasonR said:
    Some people think they are guaranteed the price they signed up.

    To be fair, some provider also states the price is fixed and never goes up. @wg, anyone ?

  • ZerpyZerpy Member

    @Edmond said:
    Personally a few dollar's increase on the next bill (not charge me more when I haven't used up my year) is alright, but I tend to switch as soon as I see a cheaper option when it's nearing the end of the billing cycle. Really hosts shouldn't be increasing current customer's pricing unless it turns into they losing money to keep the customer.

    What about the other way around? If a provider decrease prices or give more hardware for same price - your plan shouldn't change either right?

  • NekkiNekki Veteran
    edited March 2018

    @yokowasis said:

    @MasonR said:
    Some people think they are guaranteed the price they signed up.

    To be fair, some provider also states the price is fixed and never goes up. @w

    It's foolish to state that. Realistically providers should state that the price is fixed for life with the possibility of an increase of X year-on-year, to prevent who gets unless they're 100% comfortable they can keep turning a profit.

  • EdmondEdmond Member

    @Zerpy said:

    @Edmond said:
    Personally a few dollar's increase on the next bill (not charge me more when I haven't used up my year) is alright, but I tend to switch as soon as I see a cheaper option when it's nearing the end of the billing cycle. Really hosts shouldn't be increasing current customer's pricing unless it turns into they losing money to keep the customer.

    What about the other way around? If a provider decrease prices or give more hardware for same price - your plan shouldn't change either right?

    Well I wouldn't mind if my plan didn't change either, I mean as long as I am paying for what I expect, it's alright. The people who asks to get a special's pricing for a existing service shouldn't be doing it. If you really want that pricing or specs, cancel your service and reorder.

Sign In or Register to comment.