Last week, I addressed the question whether or not you should register your domain name the same place you buy your web hosting.
Today, I want to address another common “myth” within the web hosting industry, and that concerns whether or not you should pay monthly for your hosting.
If you read popular web hosting message boards, a lot of people will recommend paying monthly for your hosting service, with the thought being if things don’t work out you can easily cancel and move to another provider.
Getting The Best Price
Most web hosting companies, such as Name Hero, greatly discount packages that are paid further in advance.
Collecting small payments each month is not only an accounting nightmare, but having to worry about transaction fees, declined cards, etc. it’s much easier to collect at least one-year upfront.
Because we’re able to collect the full amount upfront, we’re also able to offer specials such as a free domain name, Cloudflare, nightly backups, and more.
Protecting Against Fraud
When I first launched Name Hero, I thought the “big brands” that tried to “force” customers into paying one-year in advance were just being greedy.
After offering many $5.95/paid monthly accounts, I quickly learned I was in for a “fraud” nightmare.
Despite having excellent fraud systems in place, some bad actors are still able to get through. I quickly learned, it’s not that hard for a fraudster to charge $5.95/month on a stolen credit card. Most companies alert card holders of larger transactions, meaning these small charges can add up for months, if not years before they’re caught and eventually charged back.
Just think, if a Spammer or Scammer has $100 loaded up on a pre-paid card, they could potentially purchase 19 shared hosting accounts across multiple companies to carry out their schemes.
Quality Over Quantity
With nearly 2 and a half years under my belt running Name Hero, I’ve also found the higher quality customers come from those that pay longer than one month.
Customers that choose to pay for one month at a time often take up long support hours and resources only to cancel the next month.
Especially since most hosting companies (Name Hero included) offer a 30-day money back guarantee. Nothing is more frustrating than answering 20+ support tickets for a customer that paid $5.95 and then requests their money back before the end of their first month! Ouch!
Shared Hosting vs. Reseller Hosting
Because the reasons listed above, is why only our Shared Business package is available to purchase on a month-to-month basis. The price (without promos) is $25.47/month. This still equals out to $0.82 per day and also one of our most popular packages!
Our Reseller Hosting packages are a bit different.
A lot of our Resellers are buying larger blocks of web hosting to make a profit by reselling to other customers. Since we know all about being a startup, all of our Reseller packages are available with a monthly option.
However, for those that decide they want to commit to a longer term, we discount the price up to 50% depending on the package. We see a lot of Resellers try our Corporate package out at $39.95/month and then later upgrade to a 3-year package once they see how we run things :).
Upgrade At Any Time
When you sign-up at Name Hero for any package, you’re always protected by our 30-day money back guarantee. However, if you decide a year or two in, you need a bigger package, we’ll apply the amount you’ve already paid to your new account.
I can’t tell you how many people will come in and buy a Basic Plus hosting package and later upgrade to a VPS. They find comfort knowing we not only apply the $$$ but we also handle the migration and setup for free!
In my opinion, I don’t believe you should buy a package month-to-month for quality control. Do your research on the hosting company you’re choosing and get the best discount possible.
Even though a longer-commitment means paying more upfront, the savings in the long run will help you run your business more efficiently!
Ryan Gray is the founder and CEO of NameHero, one of the fastest growing independent web hosts in the United States. Ryan has been working online since 1998 and has over two-decades experience in Internet Entrepreneurship.
Spot on, Ryan. I know what you mean regarding the billing and merchant fees logistics nightmare. Love this article and sharing it with my future clients who aren’t already on Namehero. All of them (including myself) are extremely happy with your services and have never been disappointed. You do go above and beyond!!
Thank you Cyndi!!
As a new small business owner of a small local service type company We are having aN outside compAny build our first website. MY confusion is In trying to understand why they charge $100.00 a month for hosting and insist that is the only wat they will do the website? whAt is the reason? Is their server better? How? Are they just using this as another revenue stream? What is the real readon?
Good question! You would need to ask them specifically what they’re offering to justify the $100/month charge. Feel free to ask them, reply back with their comment, and I can help further!
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Hey Doug, which links specifically?
So when we set up a reseller account…. we shouldn’t charge monthly?