Why did Bigzoo go out of business?

At the end of December 2004, an announcement on the website created panic amongst the customers of former prepaid calling card and long distance provider (among others) company Bigzoo. It stated that as of January 31st 2005, the company was going out of business and that all customers had to end their dealings with the company by then.

But what led to this drastic end for a company that had been on the telecommunications market for over 5 years? Even though much info regarding the problems the company was facing did not leak to customers, we can still speculate on what was one of the biggest letdowns for people that enjoyed the service offered. Most likely the main reason was the increased competition in the segment, with more and more providers of long distance service at low rates entering a market that has slowly became saturated as well as new means of communication, like online messaging and VoIP services gaining ground.

Bigzoo collapsed under the weight of its own success. It has started slowly to build a customer base on an emerging calling cards market and tried to always stay ahead of the competitors, offering new features – pin free dialing, auto recharging, auto redial - and low rates for international calls. The company even expanded its services into the ISP business, offering internet connectivity at competitive prices. Still, slowly but surely, profit margins began to decrease, while new technologies were allowing competitors to come up with low rates and similar services.

90% of customers, in case of a company that deals with prepaid calling cards sold over the internet, come from search engines. If you cannot come out profitable from the battle with other competitors over traffic, you’re going to loose, sooner or later. Poor marketing techniques is probably another reason why Bigzoo went down – building a customer base is not enough for this kind of business, one needs to constantly bring new customers in order to succeed; even though most calling card users replenish their accounts at least twice a month, if no new customers come in at a relatively good rate, it is impossible to keep up the business. While the competitors were battling over the #1 spot in Google, Bigzoo was nowhere to be found. Relying solely on word of mouth or other promotion techniques is not the best idea.

Of course, once the word was out that the company was going out of the calling cards business, all competitors started battling over the Bigzoo customers. Promotional offers started pouring all over the internet while customers were seeking advice on forums regarding the best long distance alternative to their service.

Like I said before, not much information has been released in order to figure out what exactly happened. The calling cards business is still a competitive market and a very good alternative to people looking to reduce their communications costs. Even if failures such as the one that happened to Bigzoo may come once in a while, there are still enough offers out there that can cope with any demand.

One service that I recommend to those still seeking an alternative to their favorite long distance and calling cards provider is Enjoy Prepaid. It offers most of the options that Bigzoo had – pin free dialing, auto recharge, call back service, using a single pin to dial to multiple destinations and many other features, together with very good rates. You can check out the offer below.

Long distance alternative – Enjoy Prepaid

Dialing instructions

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