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[An idea for providers] You don't really have to sell cheap
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[An idea for providers] You don't really have to sell cheap

zhuanyizhuanyi Member
edited March 2013 in Providers

I know recently there seems to be a trend on LET with people offering more and more resources at LEB price levels, however, recently I have come across this provider who has been advertising on WHT for a while:

http://www.webhostingtalk.com/showthread.php?t=1248385

Guess what? Fresh Roasted is reselling services from Burst.NET, which is not what I would consider as "premium".

I am not here to criticize their business practice and in fact, the fact that they have been around for a year or so at least without going under seems to indicate to me that they are doing a pretty decent job and there is that side of the market that is waiting to be captured.

Just an idea for those providers who are scratching their head to come out with a 7USD for 100GB RAM plan :)

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Comments

  • prometeusprometeus Member, Host Rep
    edited March 2013

    @zhuanyi said: 7USD for 100GB RAM plan

    Thank you for the idea! Working on this right now... :-D

    EDIT: actually, the suggestion to not (only) sell cheap plans is very good. And is more important if you don't have resources/money to sustain a low margin business.

  • @prometeus said: Thank you for the idea! Working on this right now... :-D

    Shouldn't be too hard, just disallow everything except website hosting and personal VPNs

  • @prometeus said: Thank you for the idea! Working on this right now... :-D

    I am sure Uncle Sal always knows what's his doing! But if that does happen, it will have to be called oooooooooooooooooverzooooooooooooooooooold, LOL

  • @zhuanyi said: Just an idea for those providers who are scratching their head to come out with a 7USD for 100GB RAM plan :)

    I am working on it.You can expect in next 20 years :)

  • Already bowed out of the race to the bottom :P

  • @ftpit said: I am working on it.You can expect in next 20 years :)

    At the level this community is going....I think you'd be the LEB provider offering the least amount of resources for 7 bucks by then :)

  • jarjar Patron Provider, Top Host, Veteran

    A lesson that had to be beat into my head: The price of a promotion doesn't have to be your regular price.

    Take ChicagoVPS for example. They really shook things up with their 2GB offer. Regular price is $25/m. Do you think people are paying that? You bet they are. Your lowest promotion is not the only price people will pay. We sold several 2GB at $15/m right after posting a $7 promo for it...

  • @Damian said: Already bowed out of the race to the bottom :P

    Exactly, if you can't be the cheapest guy, you can just go for the "premium" market :) Not saying you should completely give up on us, but having a premium line of offering is probably a good idea on top of your budget line.

  • @zhuanyi said: At the level this community is going....I think you'd be the LEB provider offering the least amount of resources for 7 bucks by then :)

    RAM will way cheaper by then.Servers will be using TBs of RAM in 20 years future

  • @jarland Yea I agree with you.Promos really help for expanding

  • Cheap, tons of resources and good quality

    image

  • raindog308raindog308 Administrator, Veteran

    @zhuanyi said: I am not here to criticize their business practice and in fact, the fact that they have been around for a year or so at least without going under seems to indicate to me that they are doing a pretty decent job and there is that side of the market that is waiting to be captured.

    Just an idea for those providers who are scratching their head to come out with a 7USD for 100GB RAM plan :)

    Well, duh.

    Lots and lots and lots of providers who are not in the LEB market. What's your point?

  • Most providers aren't interested in the lowend market.

    Do I believe someone on WHT selling Xen for $15+ a month has the formula perfected? No.

    Rather, the person has other revenue streams and VPS sales are minor addon business to round out servers, probably.

    That example is the polar opposhit of what goes on here on LET. Here providers sell you what they already sold 5 times then hope and pray and hide behind terms if you dare use what you bought. Then again the WHT poster could be doing the very same thing, but unlikely.

    The market is a mess. Ranges are way too wide on pricing and overlapping much bigger offers.

    Folks should consider the ala carte pricing model. Offers custom built to suit needs of the buyer. Realistic for all involved.

  • DomainBopDomainBop Member
    edited March 2013

    [An idea for SOME providers] You don't really have to sell cheap

    I edited your thread title for you because a quick glance at some of the "providers" (term used loosely) posting offers recently (especially the ones who bump 5 threads to get their post count up so they can post an offer) indicates that there are quite a few newer providers (and some not so new) who do need to sell cheap because "cheap" is the only thing of real value they have to offer.

    Summer is coming, so here's some food for thought: the startup costs for a summer VPS hosting business ($49 L5420 w/raid1, SolusVM/WHMCS licenses, SSL cert, etc) are significantly less than the startup costs to be a bike messenger (bicycle, helmet). In the '50's and '60's young'uns spent their summers working as paperboys, in 2013 they fill out an order form at datashack, pay with mommy's credit card, and become instant CEO's. :P "Summer host" calibre providers do need to sell cheap if they want to get any customers.

    The good providers who do have something to offer (i.e. a good product/service) already know that they don't have to limit themselves to selling exclusively at the low end, and use their low end offers as a promotional tool while also offering higher prices products. As @jarland said, "The price of a promotion doesn't have to be your regular price.

    the fact that they have been around for a year or so at least without going under seems to indicate to me that they are doing a pretty decent job

    The fact that they have been around for a year indicates little to me. One year isn't really enough time to determine whether a business is going to survive because the majority of small businesses do survive their first year. See chart below.

    Small business failure rates:
    Year Percent Failed
    Year 1 25 %
    Year 2 36 %
    Year 3 44 %
    Year 4 50 %
    Year 5 55 %
    Year 6 60 %
    Year 7 63 %
    Year 8 66 %
    Year 9 69 %
    Year 10 71 %

    (chart is from a survey at Statistic Brain http://www.statisticbrain.com/startup-failure-by-industry/ ...not surprisingly, the #1 reason given by the survey for startup failures is incompetence )

  • aiuraiur Member

    I hope everyone can pay some to keep the providers in good shape

  • JacobJacob Member

    My higher clients make up for all you lowballers. > . >

  • @raindog308 said: Lots and lots and lots of providers who are not in the LEB market. What's your point?

    My point is: providers who are currently competing in the budget VPS market and trying to provide as much resources for as little as possible don't have to set there mind in going after low resources, sometimes charge a little higher would work too and makes you become attractive to another clientele.

  • @zhuanyi said: My point is: providers who are currently competing in the budget VPS market and trying to provide as much resources for as little as possible don't have to set there mind in going after low resources, sometimes charge a little higher would work too and makes you become attractive to another clientele.

    And you're basing that on what? The fact that FRH hangs around WHT and may or may not be going out of business as we speak?

    What actual evidence or analysis do you have that their business plan works?

  • @Jacob said: My higher clients make up for all you lowballers.

    That is, your suckers are paying for my LEB. Give them my thanks!

  • @nutjob said: And you're basing that on what? The fact that FRH hangs around WHT and may or may not be going out of business as we speak?

    How did FRH get into this? Did I miss something?

  • nutjobnutjob Member
    edited March 2013

    @concerto49 said: How did FRH get into this? Did I miss something?

    >

    Yes, the link in the OP. That's "Fresh Roasted Hosting", BTW.

  • blergh_blergh_ Member
    edited March 2013

    If you have confidence in yourself and the product you are offering, why not charge for it? It makes little to no sense to try to have a business-model which basically says you are bound to struggle for every little dollar.

    !(http://kswt.images.worldnow.com/images/19898470_BG1.JPG)

  • @nutjob said: And you're basing that on what? The fact that FRH hangs around WHT and may or may not be going out of business as we speak?

    What actual evidence or analysis do you have that their business plan works?

    I did not say the plan will or won't work, especially in this market, plans that works for one may not work for another, I am merely saying it is something providers could consider

  • Just as you said, Fresh Roasted is a reseller.
    Less risky.

  • @zhuanyi said: Just an idea for those providers who are scratching their head to come out with a 7USD for 100GB RAM plan :)

    I prefer buying 256Mb ram and 30gb disk LEB from good host, than 1gb/2gb ram from others. Unless just for playing purposes.

  • u4iau4ia Member

    @jcaleb said: I prefer buying 256Mb ram and 30gb disk LEB from good host, than 1gb/2gb ram from others.

    +1
    Usually a lot more stable environment.

  • ztecztec Member

    The fact that I couldn't find any VPS providers who really stayed stable for at least a year made me go to dedicated servers, I just couldn't handle the fact that another client on the same node could abuse and cause my sites to slowdown. I'm paying more for it though but some REAL good and proven managed solution would still be interesting for me since it would save me some time and (hopefully money) in the future.

  • @ztec said: The fact that I couldn't find any VPS providers who really stayed stable for at least a year made me go to dedicated servers, I just couldn't handle the fact that another client on the same node could abuse and cause my sites to slowdown. I'm paying more for it though but some REAL good and proven managed solution would still be interesting for me since it would save me some time and (hopefully money) in the future.

    So far my downtimes from reputable host here are not from neighbors, but from Murphy. Which could also possibly hit dedicated servers

  • ztecztec Member

    @jcaleb said: So far my downtimes from reputable host here are not from neighbors, but from Murphy. Which could also possibly hit dedicated servers

    I guess I had some bad luck then with the VPS', but never had any problems with dedicated server (unless of course you try to host with server4you, which will give you nightmares) so far.

  • @zhuanyi said: I did not say the plan will or won't work, especially in this market, plans that works for one may not work for another, I am merely saying it is something providers could consider

    "I think resellers should consider selling 16GB plans for $30/year."

    I should start my own thread with that.

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