Do I need hosting in my country?

[josiebauer]

I'm a web developer who's looking at branching into reselling hosting - I have several clients that would prefer to just deal with me rather than having to set up hosting and manage it themselves. I've recently found that a site should be hosted on Canadian servers if you want to rank well in google.ca - is this still true? Is using the geo-targeting setting in the Google Webmaster Tools enough? I currently have my personal hosting through HostGator, and I love it - I'd rather not change to a new host just to be on a Canadian server if I don't have to, but I'm having a very tough time finding recent answers to these questions - most of the data I've found is from 2007 - early 2009, and the way things change online, I don't know what to believe.

[rainborick]

Overall, the main signal used by the search engines to determine geo-location is the presence of a Country Code Top Level Domain - like example.ca. After that, they largely rely on the IP address of the server that hosts the site. There are some other signals that can add to the determination, but these are difficult for an individual webmaster to manage successfully.

The Geographic Target tool in the Webmaster Tools console will allow you to indicate your preference for non-Country Code domains - .com, .net, etc. Of course, this is only effective in Google. Yahoo! and Bing do not offer this option, but they are also sensitive to geo-location for ranking.

You can always stay with your current host and see how things go. It takes some time after you select a Geographic Target before you start to see any effect in the rankings. 2-3 weeks is not unusual. Some of your clients may find the US geo-location to be an advantage - one they'd lose if you moved to a host in Canada. That is, Canadian users who include a city or province in their searches might well still find them, but they'd be competitive in the US in this regard. So it's not cut and dried that the move would be best for you.