3 Ways Web Hosts Sell Higher Margin Services

3 Ways Web Hosts Sell Higher Margin Services


To be a successful web hosting provider presently and in the future, Jay Sudowski, CEO of Handy Networks, stresses the importance of selling higher margin services.

For SMBs to compete with their billion-dollar hosting rivals, they must differentiate their offerings and build value for their existing and new client base.

Today, pure web hosts are diminishing, and to survive in this relatively saturated market it’s about developing a list of professional services that add value to your clientele.

Sudowski says “it’s not about the web hosts anymore, it’s really about enabling off-premise IT services for businesses; which include disaster recovery services and managed security services.”

Below are some useful tips for your web hosting company to consider when modifying your business model and services.

Detach from Commoditized Tools

First, as a small to mid-sized hosting company you should start to eliminate the use of commoditized tools, such as cPanel and Plesk. Both platforms are great tools. However, they are geared toward mass market web hosting.

Anybody can use these tools and find them at an inexpensive rate. In the end, your company would not make a profit by offering either platform.

To differentiate from your competition, grow your revenue, and build value, you must start to develop a customized menu of professional services or add-ons that you are going to offer. For example, you could offer web design, web development, or disaster recovery, while staying away from homogenized tools and pure-play hosting.

What’s Your Value Proposition?

Second, be sure you understand what your clients care about. Add custom professional services that will make their lives easier and add value. For instance, do not tell a potential or existing client that they need website security when he or she does not care about the website in the first place. Stay away from selling services that are irrelevant to your ideal customers.

Education is key to attracting and maintaining customers. Instead of trying to sell services that are not relevant to your customers, you can educate them about the value of the services your company offers through online content using blog posts, social media, eBooks, email, and webinars.

Sudowski explains how many MSPs offer “free needs assessments” and that you can do the same. This way customers can distinguish which needs are being met, along with the needs that must be addressed.

Developing an Execution Plan

To increase the value proposition, attract new clients, and drive more revenue you must consider the above tips. But where do you begin?

First, you must properly develop your buyer personas. Simply stated, a buyer persona is a representation of your ideal customer. Then, you must create strong educational content that answers your customer’s biggest questions. Educational content will assist you in getting found early in the buyer’s journey.

By developing content and educating your audience you are building a reputation as a trusted advisor, and when people find interest in your content and download it, you should be collecting their information from a form which they must fill out to receive their free piece of content. This way you can follow-up with potential leads.

Again, you are not selling to them; you are advising your ideal customers of their options.

Is your web hosting company planning to adopt a more diverse list of professional services?