Cheap is not always Better!

From time to time my partners and I are questioned about our rates for things like domain registration, web hosting, etc., and often times even have our rates compared side by side to companies like GoDaddy, etc.  This has always been an amusing thing for me to explain to those who are less tech-savvy because about 10 seconds into my response they are wishing they would have never asked…

Well, today my business partner Greg was asked by one of our reseller partners today to differentiate between what we offer and what they can get from other providers out there for a client that she is working with. Greg went on to word a nicely written email to the client that you can read portions of below or on his blog…

First of all we never try to hide the fact that many of our price points are higher than what you can get through services like *******.

The primary reasons for the pricing differences are related to the services we associate with our domains/hosting. First of all we consider ourselves the caretaker of your domain, we monitor all our domains for renewal status. We have had customers that have unintentionally allowed their domains to lapse and their site/email stops working. It is also possible that, in that scenario, they permanently lose their domain — even to a competitor. Pleth won’t let this happen.

Many companies also don’t tightly control who registers their domain, often times the legal domain owner appears to be an employee who registered the domain on the company’s behalf and often that employee is gone as issues of ownership/domain control arise.

Another big issue is DNS management. At Pleth we manage the DNS for all the domains in our registrar account. This relates to all the settings for the domain and email to work. Without our services this is left up to the customer who rarely has the knowledge of the DNS system to manage this for themselves.

Another wrinkle with the DNS management is based on the fact that we maintain virtualized servers. We do this in order to leave ourselves nimble in case of technical difficulties. It is not unusual for us to move around domains/servers on our side in order to route around outage issues. If the DNS is not within our service and therefore not within our control it is possible that customer uptime could be affected as we perform all the technical tasks on our side that are necessary to keep things running smoothly. We have 4 people that directly manage this on our side, full-time, and not having control of the DNS can negate a lot of the work that we do day in and day out.

So, if you boil it all down, with “warehouse” pricing in a system like *******’s you are essentially on your own. With Pleth, you should never feel like you are alone. In fact, most of our customers never realize any of our management activities are going on at all.

And this prompted me to throw my two cents in here as I always do…

Usually I will spout off no less than 20 techno-jargon laced reasons why we are a completely different type of company than GoDaddy or some of the others that are out there.  Now, keep in mind that I am not knocking GoDaddy, I think they have done a tremendous job in cornering the Web Hosting and Domain Registration Market these past few years, and that took pure genius!  Especially during the rise of the Internet when we were all scrambling around looking for exactly the same thing building up our own companies.

The truth of the matter is this, companies like GoDaddy are out there, and always will be, offering low-cost domain registrations and budget web-hosting plans to the masses in hopes of upselling their other various products and services.  You see it’s kind of smart the way they do it, they mark their prices really low for primary services like Domain Registrations and Shared Hosting Plans to get you in the door with them, then once you are on board you will find yourself in need of their other products like Email, SSL, Storage, etc., these are the products that they have a slightly higher profit margin built into, even though their prices are still pretty low!

Now, here’s something that you don’t get from GoDaddy and the other budget hosting companies that are out there.  I call it the “Relationship Factor”, this is something that our company was built upon from day one.

While we might have several hundred clients all spread out across the globe, we know their names and their businesses very well, and they know our names as well as our direct contact information in case they need something or have a question day or night, and trust me they sometimes do…

Do I feel threatened by the bigger hosting firms out there similar to GoDaddy?  Absolutely not, never have.  We both provide completely different services.  While there are some customers out there that are a perfect fit for GoDaddy’s service offerings, there are just as many, if not more, who simply do not have the time, training, or infrastructure to utilize GoDaddy’s products or services because they are not going to have the same level of personalized service they get with a company like Pleth.

This is where we come in…  Instead of trying to compete with the millions of web-hosting companies that are out there today, we have always seen ourselves as an extension of our clients businesses, whether it’s in the capacity of consulting, offering deliverable products such as software, web development, email solutions, or custom applications.  We see ourselves as a hosting provider second.  I will go as far as to say we probably have one of the nicest setups in terms of hosting and infrastructure as anyone else in our industry, large or small.  We have so many procedures and processes in place alongside some of today’s top management software and virtualization.  Our investments toward our hosting infrastructure has never been to  decrease overhead or increase profits I can promise you, instead it’s always been to put into use the best products and equipment for the job, regardless of the costs related.  It’s kind of like this, there are cheaper cars on the market but you still purchase a Mercedes because it makes you feel good, and you have peace of mind knowing that it’s reliable, safe, and well worth the investment!

Pleth & Pricing | Greg Smart