Web Hosting: A Guide for Online Business Owners

It seems like everybody has a website these days. And why not? The low price of web hosting — both initial and ongoing costs — for your website has made it more affordable than ever. And web hosting is easy to set up and maintain, so anybody can do it.

What Is Web Hosting?

Web hosting is what makes it possible for your website to be live, online, and viewable to your website visitors. Your website and its contents are stored on what’s called a server, which is connected to the internet so that users can access it.Anytime you add a page, photo, video, or any other type of content to your website, it will be uploaded to your web host.

Every website out there uses web hosting, from Amazon.com to the funny video sites your friends share on Facebook. Individuals and small business use web hosting too.

You could have a website for your personal blog, your freelance career to show your portfolio, your bricks-and-mortar company, or just a personal site for fun. In your case, you’re after a website for your e-commerce/online business. This will be your online storefront, where prospects and customers come to check out your products and hopefully buy.

Web hosting companies specialize in providing these servers and related technology. But there are several options. That’s why it’s so important that you pay close attention to your web hosting provider. You don’t want downtime, or for website visitors to have trouble accessing your site. This is your business, and trouble with your website means you’re not making money.

So you don’t want to invest your money and your trust in a solution that’s not going to work. You also want a web host provider that is going to offer 24/7 customer support in case any issues arise with your web hosting.

With so many hundreds, even thousands, of different web hosting companies and services out there, how do you know which one is right for you? Which ones provide great service, and which ones are unreliable? Which ones can handle the growth of your business from a simple online store to a major e-commerce retailer? How much hard drive space and bandwidth do you need, and which providers or types of web hosting can handle it?Which web hosting service will give you the best value for your money?

As you’re considering your options, don’t think that cheaper is better. You see, once your online business grows, your web hosting requirements become more complex as you experience more traffic to your site. In other words, you need more hard drive space and bandwidth to handle all the visitors. You need systems in place to account for that growth — you don’t want to be caught short when a breakthrough comes for your business.

So let’s go over this list of the five most common types of web hosting and figure out which one is the best fit for you and your needs.

1. Shared Web Hosting

In this type of web hosting, your website is on a server with other websites… perhaps hundreds. While generally the most cost effective option, the problem with this type of shared server is that your website can be affected by the other websites.

A site that gets a lot of traffic could slow your site down. So it’s probably only your best option if you’re just starting out with your online business.

The main advantage is that it’s cheap: about $5 to $20 per month.

Share hosting is a great option if you're just starting your online business and trying to keep an eye on costs. Most web hosting providers that offer shared web hosting also offer other options that let you upgrade as you continue to grow your business.

2. Virtual Private Server (VPS)

Usually, the first type of upgrade you'll make with your web hosting as you grow your business is from a shared web hosting account to a virtual private server.
With a virtual private server or VPS, you’re bridging the gap between low-cost shared hosting and having your own dedicated server. In this setup, multiples VPSs exist on one physical server, sharing hardware and a guaranteed part of that server’s computing power. But a VPS functions as if it were a separate server from the others so the other sites hosted there won’t affect your site at all.
These virtual private servers will run you about $50 to $200, based on how much dedicated bandwidth and memory you need.

3. Dedicated Web Server

Continuing with our theme of upgrading your web hosting options, once your business outgrows the needs of a virtual private server, the next logical upgrade would be to a dedicated server.
This is an ideal web hosting solution for a small online business because it offers you maximum flexibility. In this solution, you get your own physical server, just for your website, over which you have total control. And there are no other websites on the server that can affect your site by slowing it down. You get the speed and security you need.
Here’s one drawback. You probably will have to hire someone, a system administrator, to run this server’s technical side. With the ability to have root permissions on the server this is a necessity.

4. Cloud Based Web Hosting

Everything is in the cloud these days, even web hosting. In this model, you have individual servers, hundreds of them, working in conjunction to create what is essentially one very robust server. With all that power working for you, you have the advantage that if you get a big boost in traffic — say with a product launch — the cloud-based web hosting plan can handle it — no slowdowns, no shutdowns.

With these types of web hosting plans, you generally have a customized billing structure based on what you use.
Though many companies offer cloud-based hosting as a standalone product, many companies will use a cloud-based structure for their shared web hosting, virtual private server hosting, and dedicated web servers.

5. Reseller Web Hosting

This type of web hosting account is unique as it’s kind of business in itself. Let me explain. With reseller hosting you, as the account owner can use your hard drive space and bandwidth on the server to host other people's websites. These third parties pay you for the service — essentially your are reselling your web hosting space, hence the name reseller hosting. The difference between what you charge your customers and the price you pay for the web hosting space is your profit when reselling web hosting.
In many cases you can sell the web hosting using your own company/brand name — basically acting as a private label.
For the end user, a reseller hosting account is very similar to a shared hosting account. Again, this type of hosting is more suitable if you're looking to sell web hosting as an income source and not necessarily a good option if you're looking to host your own website.

What About Free Web Hosting Solutions?

You may have seen blogs that use this naming convention: websitename.blogspot.com or websitename.wordpress.com. This is technically a type of web hosting, and the major benefit here is that the hosting is free.
But before you rush to use it, be aware of the downsides. The biggest is that you’re stuck with the templates your host provides, among other limitations. And you really can’t run an online business this way, as these hosts don't really offer effective e-commerce abilities. I would completely disregard this solution unless you just want to run a personal blog cost-effectively. Avoid any type of free web hosting or blogging solutions if you intend to make money with an online presence.
If you want to learn more, see this article on why you should host your own paid website.

Putting It All Together

Before signing up for any type of web hosting platform, it’s important that you do your research to find out which solution is right for you. A cheaper, shared web hosting solution is a great way to start your online business. But you’ll quickly outgrow it. At that point getting a cloud-based web hosting service or even a virtual private server or dedicated server will be the way to go.
Web hosting could determine the success or failure of your online venture. It’s not sexy, but getting it right could be the difference between the success and failure of your online business.