I’ve watched this for 15 years and I have seen senior executives pulling their hair about slow sales, wondering if there is something wrong with our website’s order form or if someone else’s market strategy is cutting into our company’s new customer acquisition. Now I have seen both these affect orders, back in my first years in the industry I did see order forms break and prevent gaining new customers. I have also experienced other companies’ strategies which affected our sales, but nothing affects new order numbers like the seasons.
Quick note: This article presumes a couple of specific dates which affect the US more so than they do the rest of the world. For instance, I mention our tax season which is in April and we have some end of the year holidays like Thanksgiving that others may celebrate on different dates or not at all. If you are outside of the US you should use this as a guideline for how the ebbs and flow should work in your local region.
Most of the companies I have marketed for eventually reached a plateau until they developed some new product or service line or had a stronger message to the marketplace. When you hit that plateau you might see a couple slow days or strong days here or there but your percentage won’t vary too much more than 15% from your plateau, but that plateau is going to change with the seasons.
From the second full business day in January of each new year until the end of March you should experience higher sales and a higher plateau. April slows for the first half of the month then picks back up in the second part of the month and sales are stronger, although not like January – March, until the end of May. June through August are typically slower months with August being either the worst or second worse month for sales for the year. September through most of November sales are good, with October bringing the strongest sales of these three months. Finally the end of November until the second new business day of the next year sales will be slow and December could be your worst or second worse month of the year.
Here’s why:
January, school is back in session. For the parents with a small or midsize business idea they had been working on or were expanding upon just got a new year’s resolution to get their motivation back. They think expansion and for many that means a new or upgraded website. Sales jump during this period and I would tell any new web hosting business that they had better be ready to go during this time as new sales acquisition should be up until the end of March.
March is also one of the strongest months of the year so I would encourage anyone who is starting a hosting company to keep their eye on the ball all the way through here and to not become complacent just because January and February were banner months, March could be the best yet.
April hits and two things happen during this time; spring break and tax season. Luckily this only negatively affects sales for the first half of the month. By the second half of the month, school is back in session and all those last minute tax filers have taken care of their obligation to the government and they are back to being focused on their business. May should be a good steady month in terms of sales.
June arrives and summer hits… hard. Slowdown during this time is very noticeable. Kids are out of school, families are traveling or they have a different schedule or routine that throws them off of their business like focus they had during most of the first 5 months of the year. This is going to last through august and most often August is the worst month as most families have planned their last big summer trip or holidays together and the focus is just not on buying website hosting.
September… finally!!! Kids are back in school and parents and professionals are no longer in Summer vacation mode, they’re ready to get back to work, at least until the end of November. Sales go back up and October is typically the strongest month here.
A quick note during the period from September through the end of the year. Your weekends will be slow and possibly slower than they are even during the summer months. This is because you are dealing with trying to divert people’s attention away from NCAA and NFL football and I have never in all my years been able to compete with this phenomena. You will also see a slight slowdown during MLB Playoffs in October and the start of the NBA and NHL for the slight slowdown in early November. But NFL Sunday Football will crush sales on weekends.
At the end of November people are traveling extensively to see each other for Thanksgiving and then in December you have holiday parties and end of the year parties that they are either getting ready to host or attend. Kids are now also out of school which is another distraction for adults. Also during this time the days are getting shorter which makes people not quite as motivated as they normally are and all of this will drag down your sales at the end of the year.
This is the time to prepare for Q1 of the following year so that you can maximize sales acquisition during that robust period I mentioned earlier.
A personal experience of mine:
It was the end of 2002 when I experienced my first great tidal change in terms of new sales growth. Sales were way off in December of that year, close to 30% from our plateau earlier that fall. I couldn’t understand it, I had been kicking butt with our marketing, we had not lost any market positions. I checked and rechecked our marketing positions and I could not explain to the executives I worked for what was wrong or why sales were so bad. We came into the office on January 2nd and sales were not only bad that day but they had been worse the 2 previous days for the New Year’s holiday.
Everyone was worried, there was tons of hand wringing and vows to work that much harder because for us the sky was falling. The next day was a Friday and things looked up a bit and then the weekend was strong. The following week was the biggest week we had ever had and the week after that was even bigger. Sales were up over 40% from the plateau we had back during the fall. Hand wringing turned to back slapping as the trend continued for many weeks before finally tapering off a bit and then slowing down in the summer.
So it is important to know the seasons and how they are going to affect your growth and your marketing budgets. It is also important to know that a slump may not mean that you are doing something wrong. It is equally important to know that an increase may not be sustained throughout the year and that you need to keep working hard to ensure that you can continue to grow your web hosting business.
I hope that this helps anyone looking to start their own web hosting business. Good luck to you and I wish you success.