How to Start a Reseller Hosting Business and Make Money
What is a Reseller Hosting Business?
Reseller hosting is a form of web hosting wherein the account owner has the ability to use his or her allotted hard drive space and bandwidth to host websites on behalf of third parties. The reseller purchases the host’s services wholesale and then sells them to customers, possibly for a profit.
Simply put, reseller hosting is the ability to provide hosting to your own clients as if you yourself were the web hosting company. This is typical for aspiring entrepreneurs who want to start their own web hosting firm or for current web developers and designers who desire to add additional services to their brand.
Is Reseller Hosting Profitable?
With reseller hosting, you can create multiple hosting accounts under your own account. These sub-accounts are then sold to your customers at a margin. The profit lies in the margin you receive from selling an account. As your customer base grows, so does your profit.
- Finding a Perfect Niche
As a web hosting reseller business, you will be competing with thousands of other players, including big boys.
To enter successfully in this business and sustain consistent growth, you must understand the market situations and launch products and services that people need.
Instead of catering to general people, be specific in your offering. Pick a niche where you can serve better than your competitors do.
E.g., Web hosting for travel bloggers, web hosting for food bloggers, or forum hosting.
If you are already serving clients in a particular vertical, then it’s easier for you to take action.
No matter if you are building a web hosting reseller business from scratch or want to upsell hosting services to existing customers, you should work on building a memorable brand that people can be proud of and recommend to their peers.
Learn how lean branding works and create all business assets that match your brand identity.
Logo, font, colors, website layout, blog graphics, social media kit, ad copies, and email signature are a few things to mention.
Integrate your USP to branding to get most of it.
- Picking a Perfect Web Hosting Company
Pay more attention here because it is the crucial aspect of your web hosting reseller business.
Understand which product and add-on services you want to offer to your clients. So, you can easily find out how much resources you need at any given time and pick the best reseller web hosting plan.
Disk space, bandwidth, CPU power, and Memory are prime considerations while choosing a reseller web hosting company.
Take a quick look at the points you should consider while choosing a reseller web hosting.
- The reputation of the parent company
- White label and private name servers
- Website migration service
- Website backup service
- WordPress Compatibility
- Domain reseller account
- Available server locations
- 24/7 expert support
Usually, people buy web hosting for a year or more. So buy a reseller hosting package for at least a year which often includes a discount.
Do not buy the smallest reseller hosting package because you may need to upgrade to the higher plans to add more resources and features. E.g., free billing system
- Develop A One Stop Solution
You as a reseller hosting provider will get a chance to offer a wide range of services to your clients. This means you are selling a combo package to your clients that is, website development and web hosting. In short, your client will get everything under one roof and your business will get expanded in the hosting sector also. So, ensure that the hosting company you sign up with offer relevant products and services to serve your niche market.
Once you set up a web hosting reseller business, the next step is to capture leads and close the maximum sales.
Depending on your budget, skills, and experience, you can decide which marketing channel(s) is a perfect choice for you.
SEO, Social Media, Email hand SMS Marketing are useful media to deliver your marketing message to potential customers.
With some marketing budget, you can try PPC or other advertising options to generate quick business.
Finally, WOMM (Word Of Mouth Marketing) and affiliate marketing are the best way to drive referrals to your web hosting reseller business.
Create hosting packages that satisfy the hosting requirements of most of your clients. 15-25% profit margin is excellent. Anything above and below this range can shut down your venture in the first year itself.
By keeping a thin profit margin, you need to sell in bulk to generate a considerable amount, and that is quite a tedious task.
In addition, if you keep higher margins, then customers may not see your services as value for money. In the worst case, you will lose customers who would have availed other services.
As I mentioned above, you can offer additional services to increase ACV (Average Customer Value) and CLTV (Customer Lifetime Value).
Finally, WOMM (Word Of Mouth Marketing) by your loyal customers is priceless, and that is free promotion for your web hosting reseller business.
- Customer Service and Experience
Customer delight is key to web hosting reseller business. Offer maximum value to your existing customers and see how your business grows in no time.
As mentioned earlier, customer support is crucial in the web hosting business and is often the main pain point for customers who choose to take their business elsewhere. The reasoning behind this is rather simple. Hosting, for many people, is quite technical.
The best way to provide excellent customer support is by achieving two goals: number of communication channels, and the efficiency of the support you provide. A Hosting Reseller should offer customers as many ways to reach out to the company as possible. At the very least, a customer should have two modes of communication.
Then there is efficiency. Resolving issues within reasonable time frames is crucial if you want exceptional customer retention. If there will be a delay, communicate it to the customer well in advance. Open communication is the best strategy here.
In addition, make it easy for people to pay you.
Reseller web hosting business is a great way to make money by leveraging the market demands and hosting company existing assets.
Set clear goals and work to achieve them.
Although it’s not the easiest way, you can experience an entrepreneurial journey by starting a web hosting reseller business.
How to Start a Reseller Hosting Business and Make Money?
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