TL; DR: Co-Founder and CEO Bryan Muthig and his team at A2 Hosting had been thriving in the American market for more than a decade when the company decided to expand into India. After learning more about the emerging market and overcoming barriers to entry, A2 found its solutions were a natural fit for the country’s community of small businesses, developers, and freelancers. We recently caught up with Bryan, who told us how A2’s high-performing solutions are gaining traction overseas.
When Bryan Muthig launched A2 Hosting back in 2001, his team concentrated on delivering three primary benefits to its customers: speed, support, and simplicity. Each of those benefits was tied to its brand promise — “Our speed, your success.” That’s why A2 configured fast servers with regional locations on the West Coast, in the Midwest, and close to the East Coast. Then, it built a smooth and efficient customer support process. Finally, the company made it easy for customers to get their websites up and running quickly.
In the beginning, A2 kept a tight focus on the American hosting market. But Bryan and his team realized that the three benefits it delivered weren’t just important to American consumers — they were valued by ecommerce retailers, entrepreneurs, and SMBs around the world.
“We started doing some research and realized that our hosting products could serve a much broader geographical swath of customers,” Bryan said. “The internet doesn’t stop at America’s borders — theoretically, our total adjustable market included the entire world. That’s why we created an international expansion strategy.”
Soon, A2 focused its attention on India. The country had a large potential market, both consumer and commercial, that needed reliable — and Windows-based — hosting services.
“We thought our products were well-suited to their particular needs. That was the driving force that pushed us into India,” Bryan said.
But the road to expansion from the U.S. and India wasn’t entirely smooth. A few legal and technological obstacles emerged, but A2 endured them because of its determination to enter the market. Today, the company’s hosting service continues to thrive in both India and America, which is a testament to both its quality and dedication.
A2 Overcomes the Challenges of Reaching Indian Customers
One of the first things the A2 team learned early on during expansion was that its existing American infrastructure wouldn’t meet the needs of international customers. The team also realized it couldn’t use its U.S.-based .com domain in the emerging market. To operate a business in India, the company would have to set up a .in website.
The main reason that setting up a .in address was so important was that Indian consumers use different forms of payment than Americans. Many don’t have credit cards that work internationally; instead, they use Indian bank transfers and debit cards. To accept payments, A2 needed to meet its new customers where they were.
“We looked into what it would take for us to accept those types of payments because, if we were going to target the Indian marketplace, we had to ensure that we could actually accept payment,” Bryan said.
While researching that topic, A2 uncovered an Indian law that stated that its central banking institution, the Reserve Bank of India, couldn’t allow foreign businesses to set up merchant accounts in the country. To create an Indian merchant account that could accept the market’s most common forms of payment, A2 had to establish a company in India. That was the impetus for the company launching its .in website and setting up shop in the country.
The A2 team also discovered that emerging markets are much more price-sensitive than the European or American markets.
“It’s a challenge to ensure that our pricing is competitive with local providers. There are always new Indian companies popping up and offering very cheap services. But our goal isn’t to be the cheapest provider. We consider ourselves to be more toward the premium end of the spectrum,” Bryan said. “We want savvy web professionals to understand and appreciate the extra levels of service, infrastructure, and stability A2 provides. That’s worth a higher price point, but we still have to be sensitive to our new market’s cost structures.”
Adjusting to a Market That Demands Windows-Based Solutions
A2 was so well-positioned to break into the market because, unlike many other American hosting providers, it offered Windows-based solutions. That type of product is in high demand in India.
“Windows solutions are much more popular in India than they are in the U.S.,” said Bryan. “We ended up getting a lot of Indian customers because we had those products ready to go. But now, we think we can do even more. Because the Windows market is still relatively new to us, we don’t feel like we’ve completely tapped into it.”
Currently, A2 offers a Windows shared hosting platform, as well as a Windows managed VPS and Cloud hosting platform. While they don’t have Windows dedicated servers, many customers have requested the company add them, which is why A2 is working on releasing one soon.
In the beginning, the company didn’t focus on dedicated server offerings, but now, it is looking to expand on that product line for all of its customers — not just those who prefer Windows.
“While we haven’t traditionally focused on the mid-market customers who want dedicated servers, we’re now in the midst of refreshing that product offering,” Bryan said. “We want to be competitive in the space. Even though we don’t sell much dedicated server space yet, it already drives a decent amount of our revenue. We think we can continue to grow that side of the business.”
SMBs, Ecommerce, and Freelancers: A2 Hosting Works for Everyone
When A2 decided to branch out from the U.S. into the Indian market, its primary customers were developers. But, as the business has grown, its customer base has also expanded.
“We’re constantly looking at what kind of people visit our website and which visitors become customers. We’ve set up a lot of processes to help us can analyze that information,” Bryan said.
A few years ago, as the A2 brand became more recognizable, the company started seeing a trend: More SMBs were seeking out its services. Today, that demographic makes up the majority of A2’s new customers.
“A very broad range of people sign up with us because we’ve built a mass market product. While SMBs are the biggest group, we also provide services for a lot of freelancers, agencies, and ecommerce sites — an eclectic mix of users,” Bryan said.
The one trait that most of A2’s customers have in common is that they are web-savvy professionals. And that’s precisely the kind of customer that A2 targeted with its expansion into India. The team knows that thriving in a new market means making the A2 platform simple, fast, and easy. That’s why the company has set up a migration department to handle the process of moving from a different provider over to its hosting service. And the migration service is free of charge for most customers.
A2 grew its American business by sticking to its mantra — “Our speed, your success.” It’s a philosophy that motivates the company to deliver great products to customers. And it bodes well for its success in the rapidly expanding Indian market.