Big Ballot Weathers Dot-Com Bust, Slow Economy
Big Ballot Inc. seems to being swimming against a strong current these days.
A year or two ago, the Irvine-based marketing company that runs sweepstakes and promotions was hunting down dot-com businesses and savoring the flavor of fat advertising budgets and a robust economy.
All the while, Big Ballot tried to keep pace with the “frenzy,” according to Chief Executive Jeff Gehl. It bulked up from 12 to 50 workers in a year and moved from a 7,000-square-foot office in Newport Beach to a 17,000-square-foot warehouse in Irvine.
But today, Gehl said he is more wary.
“The economy frightens us,” he said. “We’re tightening our belt like everybody else and trying to weather the storm. It’s ugly out there.”
Privately-held Big Ballot declines to disclose revenue figures, but Gehl said the company still is on a growth curve. This year, he said he expects to double his business. Just last week, the company printed 80 million All-Star ballots in four languages for Major League Baseball, one of its main clients.
Still, Big Ballot won’t be expanding as fast at it originally planned.
Gehl said the burst in the dot-com bubble and a soft economy has been a “double-edged sword” for Big Ballot, which creates and tallies ballots and promotions for the National Basketball Association, the Grammy’s, the Radio Music Awards, Ticketmaster Online-Citysearch Inc., Yahoo Inc., Wal-Mart Stores Inc. and PepsiCo Inc., among others.
But several big online clients,such as Broadband Sports, Rivals.com and All Advantage,have gone out of business, dealing a blow to Big Ballot. Internet-related customers provide a big chunk of business, according to Gehl. The bigger pieces, though, are major league sports and entertainment companies, which he said “fortunately are still growing at a rapid pace.”
Still, businesses across the board are shaving their marketing budgets to cut costs in tight times. Big Ballot has watched sponsorship and ad dollars dwindle, Gehl said. But it’s not all bad, he said.
“The only silver lining, if there is such, is that as traditional (print, radio, television) advertising expenditures go down, companies spend more money on promotions, which helps us,” Gehl said. “There’s more bang for the buck.”
Another bright side: as companies look to cut back on in-house marketing, Gehl said many look to outsource their work to Big Ballot. The company’s ballots and sweepstakes can yield a gold mine of customer data that helps clients find new buyers or better sell to existing ones.
The Internet is a big part of the process and is something that Big Ballot integrates with its offline promotions.
Luckily, Gehl said, the company never relied solely on the Web,even though the venture capital group that handled its first round of funding had pushed for it.
“I wish I could tell you it was great foresight and vision on my part, but the reality is our core expertise was in the offline world and we never gave it up, which has been a blessing,” Gehl said. “The Internet turned out not to be the field of dreams. It wasn’t just build it and they will come.”
About two years ago, Gehl founded Big Ballot.com, an Internet-based polling and sweepstakes firm, after raising $5 million. The company then merged with The Marketing Center, a 25-year-old firm specializing in balloting and sweepstake promotions.
While the Web is not going away, Gehl said companies must figure out how to make it work, which boils down to one thing: profits.
Profitability is going to be key when Big Ballot considers working with future online companies “that are able to weather the storm,” he said.
Even so, Big Ballot hasn’t shied away from the online sector. It still works with Yahoo and iWon Inc. Plus, it recently signed on Ticketmaster.com, CitySearch.com and Match.com, an online dating site.
In the meantime, Big Ballot has expanded into international soccer, is handling promotional work for NASCAR and recently launched a new tech division with five employees in Pleasanton. The unit plans to introduce business-to-business promotional services in July.
Despite the recent wins, Gehl said he plans to keep a vigilant eye on budgets and cash flow.
“We’re big believers that if we can build ‘shelf space’ in this economy, we will be well positioned when it rebounds,” he said. n
