Sold Out!

So far there are only six guys in line at the store by me.. I’ll wait a little longer.

No, not the iPhone.

DreamHost!

That’s right, we’ve sold out!

Let me ‘splain:

There are only two ways to grow a company’s revenue:

1. Get more customers.
2. Get more money from each customer.

(or 3… both 1. and 2.)

It’s been our feeling at DreamHost that we’d rather go with the former than the latter (or even both).

But why?

Mainly because you don’t have to be so sleazy when dealing with your customers, always trying to upsell them and nickle and dime them to death for extra features. People appreciate no hidden fees and no bait and switch, and by not going for #2 at all, you help #1.

And, you can always save #2 for later, if you ever reach a point where you can’t grow your existing customer base as fast as you’d like (we ain’t there yet!).. which is basically the old “get big fast and worry about monetizing later” philosophy you hear about so much in Internet start-ups.

We’re getting kinda old for a start-up (Almost a decade!), but I guess we’re still happily in that “get big slow” phase!

Let’s check out the sign up process at godaddy:

On the first page you see this at the top (among the dozens of ads for other services):
Step 1: sell.

On the next step you see:

Step 2: SELL.

(heh, I just discovered godaddy doesn’t allow you to register domains with the string “godaddy” in them!)

Ignore everything (even MeUnemployment.com, if you can), click continue… and…

Step 3: AND MORE SELL!

Compare that to our signup process. One page for your hosting info, and one page for your payment info.

It’s a little amazing what people will go through to save a couple of bucks a year!

You know what else is amazing? One of our support guys used to work at godaddy and guess how they measure the effectiveness of their phone support team?

I’ll give you a hint.. it’s not based on number of calls. It’s not based on customer feedback. It’s not based on random monitoring of quality. Nope, none of these things.

It’s based on sales! That’s right.. they actually treat their customer service line as a SALES team. Your job as phone support is not to help a caller with their question or issue.. it’s to upsell them on other services!

I can just imagine a typical godaddy support exchange:

godaddy: Welcome to godaddy, can I interest you in an adjustable rate home equity line of credit?
UGC: Um.. hi. Er, no? I just need some help transferring my domain registration away.
godaddy: No problem! However, it’s important when transferring your domain away that you turn on domain privacy. Would you like me to add that to your account now?
UGC: Uh.. really? I need that? I guess so if it’s required. Wait, how much is it?
godaddy: It’s really cheap, less than the cost of a latte a day! And, if you also get it with the new American Airlines Citibank Mastercard we’re offering, you can get it for even less!
UGC: Well, wait. I’m trying to transfer my domain away from you.. it doesn’t seem like I should be adding new servi..
godaddy: Don’t worry, I’ve already added the privacy for you! But with the credit card and heloc I signed you up for, you’ll actually be saving money, long term! If you can’t afford it right now, don’t worry, I ALSO just signed you up for a payday loan, and you should see your shipment of Viagra in 2-3 business days. Thanks for calling godaddy, goodbye!
UGC: Blam! (Shoots self.)

But they’re not the only one! I registered a domain with Aplus.net once just to check em out.. and look at this screen shot I took of their admin panel:

No words were photoshopped in the making of this picture.

It’s crazy.. more then half their navigation is dedicated to selling you more services!

But, I can’t really blame these guys. People really do fall for these stunts, and you really do earn more money. It doesn’t hurt that when you start to get big enough, you’re approached almost daily with some amazing new opportunity that needs access to your loyal customer base.

After a while it starts to wear on you and you decide to try just one.

And you find out it really does bring in some extra cash. Not much, but hey, every little bit counts, right? And it’s at no expense to you, so it’s all profit! So you try another, and another, and another, and before you know it your business is starting to remind you of a default Dell desktop!

Long term, all this selling out can be damaging to your brand. Godaddy is huge, but (as far as I’m concerned), pretty much universally reviled. When customers start to lose their naivete, they start to realize they’ve been shelling out for a lot of junk they really didn’t need.. or at least didn’t need to pay extra for. They start to realize they’ve been taken advantage of. And that realization hurts!

Alright already… what’s this about DreamHost selling out?

Okay, enough meandering. What I’m trying to say is, we’ve been approached so many times for things we finally decided to go ahead and let some of them get through. However, we’re approaching it in the most straight-forward, un-annoying, not-invading-your-privacy, open, and passive way we could…

There’s now just one place on our panel where all of these offers will be collected. It’s the new Home > Partner Offers area (thanks for the inspiration, aplus!), and if you never visit that tab, we won’t blame you.

Besides keeping it so confined, we’re also only adding “partners” who:

  1. We deem as useful to DreamHost customers specifically.
  2. Offer our customers something they couldn’t just get by signing up on their own.
  3. Seem at least somewhat non-skeezy to us.

We’re also doing something I bet you’ve never seen anywhere else; we’re fully disclosing whatever kickback we’re getting for each of these offers. I’m not sure how that will affect people’s decisions, if at all, but hey, anything to be different, right?

A bandwagon is a green alien I guess.

Finally, we’re launching this new area with a “partner” (imagine the double curly air fingers thing) we’re actually somewhat stoked about teaming up with… Bandwagon! It’s Mac software that costs $24 a year (they have to host your meta data or something?) that allows you to back up and sync your iTunes library with an FTP server.. a la your DreamHost account.

So, the deal is, any DreamHost customer can get a free year of Bandwagon and any Bandwagon customer can get a free year of DreamHost! Seems fair (except wait, isn’t a year of DreamHost worth five times a year of Bandwagon? WE’VE BEEN HAD!) If you want to try Bandwagon out for free for a year.. just go to that new Home > Partner Offers area, and click away!

Just what we need, everybody actually using their storage.