Niche Hosting

There is story of David and Goliath where Goliath would come and challenge everybody – “is there anyone amongst you who would dare to fight against me?” Who would dare to fight against him? He was a giant, there was nothing one could do to humble him. David saw the situation in a different manner. Whatever he threw at Goliath it was sure to hit him. In the end we all know that David did win. The internet is also huge.

 

Here’s another story from the Indian Epic Mahabharat where once Dronacharya takes the Pandavas to the forest to test their skills in archery. He hung a model of a bird on a branch and asked each of them, one by one, to take aim at the bird and tell him what they saw. He first called Yudhishtar, the eldest of the 5 brothers. Yudhishtar saw the entire cosmos of which the earth was a part, then a tree which was a part of the earth, and finally a bird hung on the branch of the tree. Dronacharya asked him to sit down. One of the brothers, Arjun, could see only the eye of the bird, and nothing but the eye. He shot the bird right in the eye cause he could see nothing but his target.
While the internet is huge and global, when it comes to marketing the same old rule apply – The customer is the king. He is an individual and has his needs well defined. The internet maybe the Goliath, but each customer is the bird’s eye. The challenge for the webhost is thus in finding the bird’s eye. Webhost need to create plans which suit the customer’s needs rather than just focusing on things like price, uptime, reliability, support and so on which are all important. At the same time all decent webhosts today can offer similar plans , prices, guarantees and support.

A few years back we did some research in the selling aspect of the hosting industry. Our first reaction was that the cheapest host would do well. Or it would be even better if the cheapest host offered the best features and the maximum bandwidth and diskspace. Finally, we concluded that the largest host would be the cheapest host with the maximum bandwidth and diskspace, with the greatest support and this host would have ads all over the place. This may actually work out for many, but the Return of Investment (ROI) may take more than a life-time.

The webhosting industry comprises mostly of SMEs. For them huge investments in marketing may not be the best solution. Yet, there are many webhost who have grown from a reseller hosting system to a few thousand servers within no time. And interestingly none of the hosts we studied were actually selling cheap. They all focused on the right target markets. They create a niche market for themselves.

One webhost focussed only on resellers and called it private label reseller programs. They gave out more diskspace and bandwidth and charged a higher value. Their benefits – lesser customers, higher cash turnover and lesser support requests as the resellers looked after their own customers. Another webhost focussed on webmasters only. Webmasters generally have more than one site. Hosting is not their prime business and they want an affordable solution. Also, as most webmasters are tech savvy what they needed more than regular support is a community where they can interact with various other webmasters. Needless to say that these hosting companies did grow fast.

It did not take long for the clones to come and soon such plans became a standard in the industry. Webhosts are again facing the same challenge on howto effectively market. One approach webhosts can take is to focus on certain services of hosting only. Such as email only hosting. This would be useful for people for whom email is very critical. They may prefer to have the emails on another server which is exclusively for emails only. So even their main site goes down, they’ll still receive their mails. Another good example could be backup hosting only. Here the webhost would backup the entire data of a website on regular intervals.

Webhost can also focus on certain languages and software which are very popular. Not many hosts offer Java Servlets, Postgresql, Zope, etc.. Zope only hosting for example would surely lead all the Zope developers to use as well as recommend the Zope community a webhost who specializes in Zope hosting.

With broadband getting cheaper by the day, webhosts can now truly expect the market of application hosting to get popular. There is a whole new market of large and small corporate who would not mind keeping their data is secure networks. All they need to do is log into their servers and access their data from anywhere in the world. They would be looking for applications such as Compiere or a groupware where they can access, share and store the data on the net. Corporate would not mind paying a premium for such services. The webhosts have to assure security and reliability in such cases.

Adding value to what is being offered to the customer would always interest the customer is taking services from the webhost. A webhost can offer hosting with certain software pre configured for use.

Take a look at Postnuke for example. The latest version of postnuke has had over 39,000 downloads in just about 40 days. All the customer needs to do is change the logo of the site to his logo and start writing. hostnuke has taken the initiative and offering postnuke hosting. Their plans are not cheap. But because they specialize in postnuke hosting, most customers of postnuke would prefer to be with go with hostnuke.

One can offer hosting with a postnuke, gallery and phpBB forum all bundled into one. This gives the customer more time to focus on what he wants to do with his site rather than spend time on how to implement a CMS system or picture gallery.

Sites like hotscripts.com have a section which lists the popular software. Some good ones to offer with hosting are ikonboard, eZpublish, phpShop, Zope, A-Cart etc. After identifying the right software one can create scripts to automate the installation procedure and thus reduce the time to execute new orders.

And finally, one need not go and put in a lot of money for advertising with search engines or webhosting directories. All the webhost needs to do is advertise on the selected software’s home page and be present on their forums/mailing lists.

Note – This article is also published on hostpapers.com. :)

 

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