{"id":255302,"date":"2021-09-28T13:06:06","date_gmt":"2021-09-28T13:06:06","guid":{"rendered":"https:\/\/www.webscale.com\/?p=255302"},"modified":"2023-12-29T15:56:30","modified_gmt":"2023-12-29T20:56:30","slug":"predicting-your-hosting-cost-per-order","status":"publish","type":"post","link":"https:\/\/www.webscale.com\/blog\/predicting-your-hosting-cost-per-order\/","title":{"rendered":"Predicting Your Hosting Cost Per Order"},"content":{"rendered":"

Do you know what your hosting is costing you for each sale?<\/span><\/p>\n

When planning for hosting, merchants and developers are often left with a conundrum: how much hosting is enough? Do you buy hosting to meet those occasional flash sales and holiday surges? Or do you buy enough for the remainder of the year and hope-like-hell that you\u2019ll survive the peaks?<\/span><\/p>\n

The decision often boils down to one of \u201ccost per sale.\u201d With margins so tight, every penny you can save to complete each sale is a win. Therefore, the decision on how much hosting leads many to make a fateful decision to buy low and hold on tight during the high traffic peaks.<\/span><\/p>\n

Fortunately, not all hosting requires that kind of grit-your-teeth-and-hope-for-the-best decision-making. At Webscale Stratus, we innovated hosting costs based on sessions rather than on a set, contracted price that locks you into a fixed level of hosting. In fact, we have many merchants who are just fine with our smaller Stratus Lite plans because when the surges occur (and they will happen), they know their Stratus server will automatically scale horizontally to aptly handle the increased traffic.<\/span><\/p>\n

By charging a low base rate, plus a low per session cost for high traffic periods, Webscale Stratus merchants are able to not only save on hosting, their Hosting Cost Per Order (HCPO) is predictable. From the very beginning, our merchant clients can estimate their HCPO across a variety of traffic scenarios to zero in on the right, the best hosting plan that keeps HCPO at its lowest levels.<\/span><\/p>\n

Let\u2019s look at some examples to see how this works.<\/span><\/p>\n

To calculate HCPO with a Webscale Stratus plan, we first need to know how our pricing plans work. We price our plans based on some level of capacity, including an initial number of sessions. Each plan also has pricing for sessions beyond the plan level.<\/span><\/p>\n

To understand what constitutes a \u201csession,\u201d see our article on <\/span>GA Sessions<\/b>.<\/span><\/p>\n

The formula for calculating HCPO, therefore, is:<\/span><\/p>\n

(Plan Base + ((# of Sessions \u2013 Plan Included Sessions) * $\/Session)) \/ (# of Sessions * Predicted Conversion Rate)<\/span><\/p>\n

We\u2019ll break this down by inserting actual values from our Stratus Lite plan:<\/span><\/p>\n\n\n\n\n\n\n\n
Plan Base<\/strong><\/td>\n$298\/month<\/td>\n<\/tr>\n
# of Sessions<\/strong><\/td>\nthe number of sessions you are predicting for your store traffic. Ideally, this should be a number equal to or greater than the Plan\u2019s Included Sessions. To illustrate our formula, let\u2019s assume that you\u2019re checking on costs for the holiday season and that last year, your site hosted 30,000 sessions during November 2018. You\u2019re now estimating that in November 2019, you\u2019ll see 40,000 sessions (although your usual monthly sessions average around 25,000).<\/span><\/td>\n<\/tr>\n
Plan Included Sessions<\/strong><\/td>\nthe sessions included in the plan-based price. In the example, 25,000<\/span><\/td>\n<\/tr>\n
$\/Session<\/strong><\/td>\nequals the amount Webscale Stratus charges for sessions beyond the included sessions, or, in this example, 0.475\u00a2\/session. (Yes! That’s less than 1\/2 a penny per session.)<\/span><\/td>\n<\/tr>\n
Predicted Conversion Rate<\/strong><\/td>\nthe rate at which you believe you will be converting visitors into buyers. For our purposes, we\u2019ll use 2% as an example.<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n


\nConversion rate is calculated by dividing the number of completed sales by the total sessions. For example, if you have 100 sessions and complete 2 sales from those sessions, your conversion rate is 2\/100 or 2%.<\/span><\/p>\n

When we fill in our sample values, our formula looks like this:<\/span><\/p>\n

HCPO = ($298 + ((40,000 \u2013 25,000) * $0.00475)) \/ (40,000 * 2%)<\/span><\/p>\n

or<\/span><\/p>\n

HCPO = $369.25 \/ 800<\/span><\/p>\n

or<\/span><\/p>\n

HCPO = $0.4615625 or 46\u00a2 per order!<\/span><\/p>\n

That means that for your anticipated traffic surge during the holiday season, your hosting cost per order will only be 46\u00a2 per order.<\/span><\/p>\n

Note that the included sessions each plan provide for a very low cost\/order. Only when your demand triggers scaling up do you incur additional per session charges. This means you\u2019re not paying for capacity you don\u2019t need, but have instant, automatic capacity increases as you need them.<\/span><\/p>\n

Even Better News<\/b><\/p>\n

We give you the ability to see exactly what your hosting costs will be on our Pricing page. By simply connecting to your current Google Analytics account, our pricing calculator can let you see what your costs would have been for the entire prior year! You can choose different plans and server locations (North America, Europe, Australia.) and compare the pricing to what you\u2019re paying now.<\/span><\/p>\n

This will give you the very best insights into hosting costs for true auto-scaling Magento hosting.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Do you know what your hosting is costing you for each sale? When planning for hosting, merchants and developers are often left with a conundrum: how much hosting is enough? Do you buy hosting to meet those occasional flash sales and holiday surges? Or do you buy enough for the remainder of the year and 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