Loyalty for a hosting company?

Sometimes I think I am crazy. The web hosting business is literally one of the most competitive industries in the world. If I knew how market conditions would be right now 3 years ago I may never have started Bluehost.

Let me give you a VERY typical example. Many hosting companies that charge the same price as we do (Basically $100 a year) will pay upwords of $150 or more to aquire a new customer. Seem crazy to you? Me too, but that is the business. How can you make it work if you charge $100 for something that costs you $150? Well, many hosts don’t make it work. Last I checked there were over 12,000 “hosting companies” in the world. There are 50 that make it into the “club” where you really sit at the top.

It is now common practice and belief in the hosting market that it is totally acceptable to make no money on a customer for the first 2 years, and in some cases even longer due to extremely agressive marketing strategies. We advertise with the best of them, but we have an advantage that many don’t have. LOYALTY! We lose money on MANY hosting accounts in the short term, and sometimes in the long term :( However, we know that if we exceed your expectations that you will stick it out with us. At least, we hope you will.

I was just checking our numbers today, and our long term customers (Those that have renewed at least once already) tend to stick with us. For accounts that are set to expire in April (This month) 91.67% of you have renewed, and there is still 12 days left this month to get the other 8.5% to do so. We can’t express our appreciation enough! Actually, we can. We will work harder to make the service even better. Also, expect package increases in the near future (Free of cost of course!).

In a business where you have to be in it for the long haul to make 2 wooden nickels, we really appreciate the loyalty of our customers. Thanks again for everything!

Matt Heaton / President Bluehost.com

22 Responses to “Loyalty for a hosting company?”

  1. chrys says:

    As long as you don’t get caught in the Cogent/Level 3 fights – there’s no reason to leave!

  2. Interesting figures Matt, that helps explain how the affiliate system is sustainable, when I first saw the referral payments being offered by many hosts out there I always wondered how it could be done without going broke.

  3. Matt, I’m a huge fan of Bluehost. I have been a customer for a couple of years, have signed up for several accounts, have referred many people to you, and mentioned Bluehost multiple times on blogs and mailing lists.

    My main complaint at this point is that my high traffic blogs sometimes get errors for high CPU usage. The error log shows it’s a MySQL query that’s running long, but no one in support can tell me which MySQL query it is, so I can’t do anything to troubleshoot. I just live with it, though it’s unfortunate for my readers. There’s got to be a way to turn on MySQL’s slow query log so I can see what’s going on.

    Also, I’d like to get notification during outages. Today my sites on box 102 went down. I called in and was told the RAID controller was being replaced. Would it be possible to have an email go out when stuff like that happens so we can know what to expect?

  4. bobmutch says:

    Hi Matt;

    I just signed up for the two year deal and I though I would give you some feedback on my blue find experience.

    I move because I needed PHP5 and where I was didn’t have that. More over I needed a reason to puch me out there door. They where having DOS attacks? some times done for 2 hours at a time, and the access was sluggish. I got tired of asking a client to go to such and such a page only to have them ask me if my system was down.

    To me price is not the issue. I have moved twice now in the last 6 months. The cost to move my site has to be about $100 (thanks to my quality coder from .in) due to 9 SQL db and a host of other thing that all have to be configured.

    Here is what I needed from the new host.

    PHP5
    Fast loading for my site
    50GB bw
    Numerious mySQL db
    multipul cron jobs
    Awstats
    SSH
    24×7 phone support (may companies just lie on this one)
    Payment by PayPal

    You had it all and you have my business.

    Long as you can keep your mySQL server up and you server up my pages fast you will have me for life.

  5. Noach Sumner says:

    When I first joing bluehost I was really happy. I left because I needed a specific feature (IMAP-IDLE support without sending keep alives). Unfortunately support said they couldn’t do that. fair enough I am far from the only customer.

    I switched to somebody who had what I needed or so I thought. Really my needs aren’t high but I have found my website is slower, the control panel is paninfully slow (and often down) etc.

    I should have been one of the masses who stayed. Great job.

  6. jrh says:

    Matt, I’ve had a few different hosting packages. You guys have done well by me. That’s why I still use Bluehost today. I’m of the mind that if a company does right by me, I will continue to support them. If they don’t, I leave immediately. i’m very big on this, and have suprised the hell out of some big companies (cable, phone), but saying “okay, I’m out.” I refuse to be exploited or mistreated.

    I say all this to give you my background. I’m with your company because so far, you deserve it.

  7. Nathan says:

    I’ve happily used bluehost for almost 10 months. Granted, my one domain hasn’t evolved into a “production” site, but the copious storage and bandwidth, combined with prompt support, and features ranging from SSH to Rails have me ready to renew.

    My prior inexpensive hosting company exhibited innumerable random outages. Thus far bluehost has provided reliable hosting for me, and at sub-$10/month rates. I highly recommend your services – keep up the good work!

  8. I hope you dont take this the wrong way but being one of those that renewed in april, I didn’t do it for loyalty. I’ve never been traditionally loyal, that is to say that I wouldn’t stay with a company or service just because they may have met my needs in the past or becuase “the evil you know, better than the evil you dont”.

    If Bluehost like any other company I do business with stopped delivering quality service then I would drop them like a brick.

    The fact is that Bluehost continually meets my needs, there are (slightly) cheaper hosts out there, but for the package, commitment and support as a whole, bluehost is above par.

  9. As I a proud member of Bluehost “family” (being a subscriber) and always interested in investing in business I was wondering “how can I invest my money in Bluehost” I would be flattered to hear ideas from you Matt. Sincerely, Niko Marjomaa

  10. Moti says:

    As some here pointed out, there is no real loyalty most of the time. Loyalty in such an anonymous business is another name for “I like what I get”…

    You are in a commoditized market with low entery barriers. It means it will continue to be competitive and indeed, the best way to make money is to make sure customers renew since then you don’t incur customer acquision costs. Figure out what type of customers are not renewing, and why not. Some are probably just because they are not keeping the site active, some because of this or that failure, and some because they need things you don’t provide. The question is then whether it pays to provide those, and how to do so if you do provide. And of course, to improve your processes so those failures get minimized.

  11. anton granik says:

    You are great guys! BH rocks! :)

  12. I am also an SEO as is Bob Mutch above, and I need the same criteria. I try and make sure every single one of my clients is with blue host because I know if I need any tweaks or any support I am on hold for less then a minute and I get it done with an email confirmation that same day.

    You have me and my clients for life as far as I am concerned.

    *plus I live in the valley and if I every really neede anything I can drive down and say whats up.

  13. Rachel D says:

    I tried other web hosts prior to joining Blue Host and I have to say what a difference! As a newbie, I found Blue Host to be very easy and reliable. The more I learn, the more I am glad that I chose Blue Host, and I will continue to renew in the future.

  14. I had done most of my hosting through another company since they got started about 4 years ago. They were fine as long as I didn’t need anything! I finally got very frustrated with them because A) I fought with them for months trying to get a certificate installed. B) They had a major system crash, but offered no assistance to me to get everything working again. C) There’s no number to call.

    When I moved my first account over to Bluehost a few months ago, I was shocked that I got a call about an hour after sign up confirming my order!

    I was thinking “Wow! That’s customer service!”

    At any rate, I think everything is great! Plus, we get shell accounts…hehe.

    Thanks again!

  15. Hammo says:

    Well I must say these bandwidth increases always make me a little jumpy. I am more than happy with my sites performance thus far but hope that Bluehost doesn’t over commit there resources.

    A mate of mine is about to jump because he feels the amount of sites per server is just too great. Prove him wrong BlueHost and keep up the good work :)

  16. Minh Nguyen says:

    I’m using my server space purely for development purposes right now, however I noticed that box36 can be a bit sluggish at times. Instead of trying to cram in 500+ users in a box, if bluehost cut it down to about 350+ users a box, they would keep me as a customer for life.

  17. Annie says:

    I would like to see Bluehost offers live support. It would be really helpful for us.

    And sometimes it takes for ever to login the control panel. Can it be improved?

  18. Jonathan says:

    I agree. Loyalty is a key factor. I just left a host due to it’s desire to leave out customer satisfaction. I found you quite by accident looking for another provider for a client besides the one I had. I didn’t want to do to him what they were doing to me.

    IMHO you are great. I am satisfied with you and as long as you keep up the good work, i will continue to refer you, 45 so far, and keep signing back. And you are right, they are only young once. :)

  19. anton granik says:

    Matt, do you know about them? http://bluehost.net/en/plans.php :) Just typed accidentally their address instead of bluehost.com.

  20. Rupert says:

    I only wish I had discovered bluehost before I doscovered godaddy.com, as I have two sites, and my main one is on their servers. Godaddy’s upload speeds are abysmal, their ftp server seems to be non-standard (ie: can’t connect with OSX’s ‘ftp’ terminal program), disconnects me frequently, and no one-click install goodness! Also, ssh access is the nice icing on the cake for bluehost.

    In short, After comparing features/price with dreamhost, godaddy, etc, I chose this host. Best bang for buck (features, ease of use).

    Pat yourself on the back!

  21. John Crowe says:

    I’m relatively new at everything involving web site management. I saw your add somewhere and already owned a domain name and thought to myself, “Oh, why not?” I have to tell you, that was one of the best decisions I’ve made.

    Not only has everything worked flawlessly, but I’ve been so impressed that I’ve referred several friends that are now hosted by BlueHost. So I just wanted to say “thank you” for doing something that’s considered reprehensible by most of today’s businesses: actually offering what you advertise.

  22. Nepali Forum says:

    Wow!! Bluehost, sounds to be one of the best hosting company!!
    I’m too thinking of getting one too…

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