For service providers of multi-tiered component-based applications, such as web portals, assuring high performance and availability to their customers without impacting revenue requires effective and careful capacity planning that aims at minimizing the number of resources, and utilizing them efficiently while simultaneously supporting a large customer base and meeting their service level agreements. This paper presents a novel, hybrid capacity planning process that results from a systematic blending of 1) analytical modeling, where traditional modeling techniques are enhanced to overcome their limitations in providing accurate performance estimates; 2) profile-based techniques, which determine performance profiles of individual software components for use in resource allocation and balancing resource usage; and 3) allocation heuristics that determine minimum number of resources to allocate software components. Our results illustrate that using our technique, performance (i.e., bounded response time) can be assured while reducing operating costs by using 25% less resources and increasing revenues by handling 20% more clients compared to traditional approaches.