Web Hosting Business Income: How Much Can You Make?

In today’s uncertain economy, a lot of entrepreneurs are being drawn to reseller hosting as a new source of income. Don’t be fooled into thinking this will be a get-rich-quick scheme, though, because to be successful in this field, a lot of research and hard work is required on your part.

Those that do make it often comment on what a rewarding industry it is to work in, and you might be surprised to hear just how easy it can be to get web hosting business started. If you’re still interested, read on to find out just how much money you might be able to make, what sort of different revenue streams you can generate, and the info you need to know before you choose your first reseller hosting package.

Reseller hosting is an increasingly popular method to enter the hosting market.

Individuals and organizations can buy up server space at big-name hosting platforms like Verpex, which will then be sold on to their own third-party clients.

Using this method, you can quickly start your own, on-brand web hosting business. Sounds interesting? Learn how reseller hosting works right here.

Many new business owners might opt to go down the reseller route to launch their new venture, although others may invest in a private server setup, often operating from a home office. However, all of them will need to source a reliable reseller hosting platform, write a detailed business plan, have some solid marketing skills and stay on top of customer service issues.

Find out all the detailed steps you’ll need to take to start a web hosting business.

The short answer is yes, but we need to heavily caveat this.

If you’re looking for a quick buck, we’d recommend you stop reading now, because to be profitable means a significant investment of time and effort on your part. Reseller hosting is just like any other business in that respect, profits will directly correspond to the amount of work you put in. This is a full-time gig.

You need to bear in mind that the market is becoming quite saturated with newcomers too. That’s not to say you’ve missed the boat, though, as there are still plenty of opportunities to be had; you just need to go about things in the right way.

In order to be a profitable reseller, you’ll have to find a way to stand out from competition, provide something different, and focus on a niche product or service. You’ll need a marketers mindset too, given the majority of your time will be spent looking for new clients, or keeping current clients happy.

You don’t necessarily need to go down the web host reseller route if you’d like a steady income, and starting a web-based business is a great alternative. We especially recommend this for newbies looking to make money online. You can start with something you’re passionate about, already have experience in, or simply set up a hobbyist reseller website.

The service you sell can be anything from proofreading and editing to web development and marketing advice. The important thing to remember is that this will give you the experience of setting up your own reseller website, allowing you to learn the ropes of the industry while making a little bit of cash on the side.

Once you’ve built up a good customer base, you can hire some staff to start providing the service for you, giving you more time to devote to the customer experience and marketing aspects of your site. These are vital skills to take with you if you then decide to take the leap to a reseller business.

We’ve already touched on setting up your own web hosting business via reselling, and you can expect a fairly steady income once you’re established. You’ll set monthly charges for your customers, depending on which package they sign up to, making it an easily scalable business in terms of profitability. Just make sure you fully cost your overheads for each customer, factoring in things like your own reseller hosting charges, marketing costs, and staff salaries if you’ve hired help.

Given that this can be a tough market to crack, you’re more likely to make income by focusing on your local market, becoming the go-to web hosting company in your area. Plus, this will make it easier to target your advertising spend.

Most resellers will hand off the technical aspects of the business to the host they’ve signed up to, which leaves more time for you to focus on marketing and customer service, even though technical support is handled by your server provider also. More knowledgeable and adventurous types might want to set up their own private server solutions themselves, though. This gives you complete control but can be costly and difficult to set up.

How much you make really depends on your business plan. Let’s say for example that you’re going to charge $20 per month for your standard shared hosting package, and you’re paying your hosting platform $59.99 a month to host 100websites. All you’ll need to cover basic costs in this example would be two of your own customers.

Imagine your business becomes successful, and you’ve signed up a total of 30 local businesses in your area who trust your platform. You’re now pulling in revenue of $600 per month based on the above estimation. You can start to reinvest those profits back into advertising campaigns, improvements to your customer service platform, and more.

Making money is all about sensibly scaling up in this business. Some have likened it to owning a rental property but on the internet; you’ll still need to maintain your ‘tenants’’ property and resolve any complaints.

As the owner of a web hosting business, you have a lot of control over your own profit margins. You’ll decide what a fair price is, and you’re the ultimate owner of your operations.

As well as your monthly subscription fees, you can add any number of complementary purchases to your service offering.

It’s rare to find a reseller that specializes only in hosting, and most will sell add-ons like SEO advice, website development, and even operate as a full-blown digital marketing agency with web hosting tacked on.

You can see how setting up a web hosting business can afford you quite a bit of flexibility, but again, we’d like to stress the significant amount of groundwork you’ll need to put in to make a success of it.

If you’re not quite ready to take the leap into reseller hosting, you might want to consider becoming a web hosting affiliate instead. Most web hosts, and even a lot of resellers, will run this type of program. Here, you’ll be granted a share of the revenue of any sign up you can bring to your partner business

It removes a lot of the risks involved in setting up a venture yourself from scratch, and it gives you the chance to dip your toes into the water to learn about the industry. In fact, some affiliate programs can be quite generous, although you’d have to be exceptional at convincing new customers to join if you wanted to make a full-time job of it.

That being said, you’ll still need to possess some pretty strong communication and marketing skills if you want to become a web host affiliate even just as a hobby or sideline.

Whichever type of web hosting business you end up opting for, finding new clients is going to be your new daily grind. We’ve touched on the competitiveness of the industry already, so just launching a new business hoping to get found on Google just isn’t going to cut it.

Check out the potential client base in your local area first, attend networking events and build relationships in your local community. From here, you can establish a small, but loyal, client base that will in turn spread your fame by word of mouth should you provide a great service.

If you’re feeling bold you can even take a look at websites of local businesses that are somewhat lacking in style. Get in touch directly to see if you can help improve the design while snapping them up into your hosting business.

Couple this with some targeted Google ads across your niche, and you’ll soon have clients rolling in.

Niche and Branding

It’s not enough to just set up a generic hosting business these days. The big players already have this market cornered, and you’re going to have a really tough time trying to steal a share.

Instead, you’ll want to focus on a niche. Think about how your current skill set can guide your decision. What inspired you to start a web hosting business? Try and set yourself up as someone there to solve a problem.

Or, you might want to cater to a specific industry, like plumbers or craft shops. If you have knowledge of a particular sector, leverage this to appeal to others in the same niche, allowing you to more easily sell your web hosting services.

Choose the Right Hosting Partner

Choosing a hosting platform that isn’t compatible with your business goals will spell disaster from day one, and you could find yourself starting to lose money rather than making it. Look Into the company’s reputation, whether it offers a free website migration service and 24/7 support as a minimum.

Get A Marketing Strategy

Without an effective strategy, you can expect your income to remain low. You’ll need to find the most effective ways to target your niche, and you might want to consider taking some online digital marketing courses or engaging the help of a professional to get you started.

Some channels you might want to consider include social media marketing, perfecting your SEO skills, and email campaigns. When you’re just getting started it’s always worth considering pay-per-click advertising on popular search engines too. When done right, most entrepreneurs can quickly find their investment pays dividends.

Don’t Get Into a Price War

In such a crowded market, the last thing you want to do is get caught up in a price war. In trying to race to the bottom in order to compete, not only do you end up looking unprofessional, you’ll find you’ll start to attract the wrong type of customers. Ultimately, your margins will eventually become so thin that it’s just not worth it anymore.

Instead, try to focus on some of your top qualities and market these as your primary selling points. In fact, you’ll often find that charging a premium for your services actually makes you stand out from the crowd and projects a more trustworthy image. It tells the world you’re willing to stand behind the quality of your product.

Be Ready for the Long Haul

In the medium to long term, you can expect to make quite a lucrative income from your own web hosting business, but this all depends on how much work you put in during the initial stages. It takes a lot of consistent effort to draft your business plan, search for customers, deal with queries and deal with marketing.

As long as you don’t expect to make fast cash from your web hosting business, it can be a long-term, and very rewarding, career for you.

The most important thing to remember when it comes to web hosting business income is that you get out what you put in. While it’s quite a simple venture to scale up, and allows for steady monthly revenue, it still requires hard work.

That being said, it’s now easier than ever to get started, and landing profit margins of around 15% - 35% is definitely possible. Even those lacking in technical knowledge can launch their own company with the assistance now offered by large hosting platforms, which provide impressive reseller packages.

With a safety net offered by money-back guarantees, why not give it a try? You’ve got nothing to lose and you could be earning while doing something you love.