Do you think brands are important in the VPS market?

Discussion in 'Hosting Talk & Reviews' started by lbft, Feb 11, 2014.

  1. lbft

    lbft New Member

    178
    161
    May 15, 2013
    I was reading an interesting New Yorker piece about a consumer shift away from loyalty to brand names and towards seeking reviews and other information instead.

    It got me thinking: if you accept the premise that people don't give much weight to branding any more, how would/does that affect behaviour in the VPS market? Do companies selling a product seek to develop their brand or are they focused more on the product itself or its pricing? Do customers give any weight to brand names or is it really all specs and reviews driving decisions?

    To me it seems more like somewhere in-between the two extremes. A history of good performance and happy reviewers feeds into my perception of a brand, but value matters enough for me that there are good brands that I don't buy from. It's harder to build a brand based solely on marketing budget but at the same time it's easier to charge more if people know your name.

    So I suppose my question is: what role do you think brands play in this market?
     
    Richard Leik likes this.
  2. drmike

    drmike 100% Tier-1 Gogent

    8,573
    2,717
    May 13, 2013
    VPS companies here and over on the old junker sites are mainly small businesses (98%+/-).

    These companies make it or fail based on the ownership/management/public facing folks and community perception.

    What they are talking about in that New Yorker article, as it relates to brand loyalty are consumers sticking to already entrenched well branded and heavily marketed goods/companies.   Saying these folks are migrating to brand names makes no sense.  Maybe through gleaning reviews they determine that Hunts is making a better line of Ketchup than Heinz, but big deal, that probably was doable switcharoo at retail point of purchase through shelf placement, coupons, and better packaging.

    Everything is branding and even in today's poor economy.  Today companies are branding value, payment flexibility, inferred quality, etc. in relation to their company/products.

    Reviews matter and chatter matters.   If your reviews are buyer beware, eventually the buyers will take notice and so will your bottom line.  Chatter or visibility online is really big.  It's brand re-enforcement.  Any way to get the brand out there is basically acceptable (especially if you subscribe to the Buffalo school of mis-marketing).

    With the contraction in global consumer spending there are fewer risk dollars invested in startups and creating masses of products before demand is realized.  So, you will note the rise of big business from the dust and far fewer upstarts.

    Price is something in VPS land on these sites driven down artificially.   It's depressionary devaluation of the resources.   You most certainly can demand a high amount for the VPS commodity, many companies do and intentionally keep out of the discount arena.

    Really the prevailing logic and hope of virtualized environments is that the oversell ratio is able to handle all users when/if they decide to use.  The entire concept of oversell and virtualization is missing to even technical folks who think the allocation is deducted from the pool in entirely, but OpenVZ doesn't operate like that.   So there is a layer of misinformation and fraud at play.

    There are some notable brands in this market.  Honestly though, steamrolling them with professional marketing and PR wouldn't be hard.  Just some spend and time.
     
    vRozenSch00n and lbft like this.
  3. stim

    stim New Member

    115
    32
    Jun 22, 2013
    Definitely not. A fancy-pants logo doesn't guarantee reliability and good customer service. Believe me, I know.
     
  4. lbft

    lbft New Member

    178
    161
    May 15, 2013
    It can be an intentional branding decision to be deliberately un-shiny too - e.g. TinyKVM vs the main RAM Host brand (not the shiniest, but you can see the deliberate difference here), or for a non-VPS example the Tarsnap backup service.
     
    Last edited by a moderator: Feb 11, 2014
  5. raindog308

    raindog308 vpsBoard Premium Member Moderator

    877
    675
    May 16, 2013
    Brand is MUCH more than just logo.

    Brand is identity.

    At this small business level, business name and brand is often one and the same...despite some silly talk about "premium brands" by 16-year-olds.  Most providers have multiple services but all run under the same brand - e.g., from Catalyst I can buy Shared, OpenVZ, KVM, etc. but they are all under the Catalyst moniker.

    A different example would be KnownHost - there's KnownHost if you want Managed VPS/servers, and RocketHost if you want unmanaged. That's an example of two different brands with two different identities.
     
    lbft likes this.
  6. bauhaus

    bauhaus Member

    67
    20
    Sep 8, 2013
    ^This.

     


    If it is important? Sure it is. More in this industry where the product is very homogeneous and there is a continuous struggle for positioning in the consumer's mind. Positioning is the key here.

     


    A brand has tangible and intangible properties and in a market where there are very few differences between the tangible from one brand to another, you need to create  positioning of an intangible.

     

    Examples: BuyVM is perceived almost as a cult brand because of his quality service, RamNode is perceived as a solid and trusted brand; Prometeus as a brand solid and very knowledgeable about this industry.

     

    The purpose of a brand is to differentiate your product from others and make them think of you first when making a purchase decision.
     
    raindog308 and lbft like this.
  7. drmike

    drmike 100% Tier-1 Gogent

    8,573
    2,717
    May 13, 2013
    A logo is just one tiny piece of brand identity.  Brand identity itself is just one piece of branding.
     
  8. drmike

    drmike 100% Tier-1 Gogent

    8,573
    2,717
    May 13, 2013
    The purpose of a brand is to differentiate your product from others and make them think of you first when making a purchase decision.

    ^--- This.

    Branding is usually a value re-enforcement, but not necessarily value relating to cost..  That value can be best product for the dollar, best product overall, best solution provider for a niche, etc.

    Branding is about in mind awareness to customers and tongue tip mentions by those folks.

    It's buying lottery tickets essentially for the customer purchase time chance to sell to them.

    There are companies and brands that excel at awareness (see: McDonald's) while delivering lousy products and often crummy experience.   In many ways, the low price VPS market is imitating that largess, especially when you isolate the Buffalo crew.  Unsure if they understand what business they are really in, and thereby are likely about to chew their own limbs off in continued gluttony pursuit of more direct sales to customers.
     
  9. wlanboy

    wlanboy Content Contributer

    2,126
    1,169
    May 16, 2013
    Brand is depending on the owner. It can be a well known name or it can be much more.

    Yup Apple or BMW or HTC are brands but if you look to the small and medium-sized businesses it is about personal reputation and about trust.

    There is a small 8 head company in our town selling custom servers.

    If you think about it everyone should buy servers from HP, Dell or [put your fav brand here].

    But all companies in our area are buying the servers from them right out of one single cause:

    Their beyond the sky reputation.

    Everyone knows the owner and everyone knows how he handles problems.
     
    vRozenSch00n likes this.
  10. BuyCPanel-Kevin

    BuyCPanel-Kevin New Member Verified Provider

    121
    23
    Oct 7, 2013
    In this market so many people (or companies) are selling basically synonymous goods, with very little variation in price, it's hard to get a good brand name. But it's not like it's irrelevant or anything, if you have good servers then eventually your brand name will get more and more recognized, but the good services come first (and surely is more important)
     
  11. QuatroVPS

    QuatroVPS New Member

    10
    0
    Aug 6, 2013
    Brand building is important for all long term companies, its a long process and takes years to build.

    Not everyone is interested in spending money for years without getting the same back but building brand is not something you can do and expect profit next year.

    I think too many of you talking about look and logos as a brand, yes its a part of brand building but did you remember paid trademarks, long term marketing with the intention of just be visible without even think you making money of it ?? thats also a major part of brand building to have people thinking of your brand if they take your name from someplace without looking for a offer and finding you there.

    Most of the companies in this industry dosnt even have the capital to build a brand, but they would for sure done the process if they could afford the money and time it takes to build it. (Maybe i am wrong)  :huh:
     
  12. AuroraZero

    AuroraZero Active Member

    240
    121
    Dec 18, 2013
    I think this is may be where some hosts fail the most. Since there are so many selling the same goods at the same price you need to make yours stand out. One way to do that is with your brand. If you develop it the right way you can make it stick out in the consumer's mind. When you make it stick out in the consumer's mind they think of you when they go to purchase products.

    Yes it takes time and effort. Sometimes it takes trial and error. Even the big stores have a hard time sometimes doing this one thing. When it is done right though you can surely bet that people will come to you for their needs and wants. It does not take something unique necessarily, you just have to build your brand the correct way.

    Edit: grammar
     
    Last edited by a moderator: Feb 13, 2014
    QuatroVPS likes this.