Originally posted by: lilcam
what happens after the year is up?
That's the $64,000 question, so to speak.
The $9.24 / year deal was a "7'th Anniversary special" - discounted from the "full" price of $120 / year.
Guess a lot of us will be looking for the next, latest and greatest, deal.
Especially if DreamHost's renewal price is anything over $X.
Trick is, what should DreamHost set $X at?
As a business, DreamHost ought to be looking at maximizing net profit.
And, they'll likely have to consider a ton of capital already invested and other big longer term (bandwidth? data center?) contracts.
They'll have at least most of a year's statistical knowledge about such $9.24 / year customers, and on a domain by domain basis, to boot.
I guess I'd make renewal offers based on each customer's statistical usage track record - probably via a "low use" discount / rebate, of some sort. Keep the "low use" customers for little bucks and charge full value to those waaay over the averages. No sense in losing money when you can statistically predict that is what is going to happen.
And, if done with an "open hand" - telling customers why they fall into whatever high or low use statistical bucket - might go a long way toward minimizing "churn" and maximizing profit.