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27 Sep 2016 - 23:33:07

This start-up wants to completely reinvent marketing - CNBC

At next week's Dreamforce conference, technology entrepreneur Darian Shirazi plans to stand out among the 170,000 attendees by dressing up in a Formula One racing outfit.

It's gimmicky, to be sure, but there's logic to it.

Shirazi is CEO of a 140-person start-up called Radius and, at Salesforce.com's annual customer conference, he's promoting a brand new product designed to wait for it drive revenue.

Radius' software collects and catalogs data on 18 million U.S. businesses to help companies focus their marketing campaigns. On Tuesday, the San Francisco-based company unveiled the Radius Customer Exchange (RCX), which enables corporations to get even more efficient and targeted with their promotions by going after customers of other brands.

For example, as part of the launch, Sam's Club, the wholesale chain owned by Wal-Mart, has teamed with payment systems provider First Data, allowing the two companies to co-market products or create campaigns to reach clients of the other company.

It's easy to imagine other collaborations.

Car rental companies could partner with hotel chains to offer discounts to each other's customers. Insurers looking to expand in a particular region could join with a prominent telephone carrier or bank in the area. American Express is also one of Radius's launch partners.

The accuracy of the data is one big differentiator between Radius and traditional corporate databases like Dun & Bradstreet. Because Radius is sitting on top of Salesforce's customer management systems, it's updated in real time, so doesn't suffer from the deficiencies of static corporate catalogs.

"You're getting very warm leads from another brand," said Shirazi, who started Radius in 2009 and last year raised a $50 million financing round with funding from Salesforce Ventures. "Companies can work together to drive business for each other."

The system works like a social network of sorts. A business can send a friend request to another company and if a match is agreed upon, they get a certain amount of time to analyze customer overlap before deciding if they want to move forward with a deal. Names and contact information of customers aren't shared, just general details about the number and types of matches.

Radius is playing into a broader trend of software-based predictive marketing. Over $200 billion is spent annually on advertising in the U.S., according to eMarketer, often with companies hiring agencies for creative campaigns. But with improved tools available for companies to understand their own data, they can spend some of that money on software and cut down on their marketing and advertising costs.

"These new platforms are really allowing companies to take customer engagement capabilities back in-house," said Ian Kahn, a partner at PwC Consulting and expert on the Salesforce platform. "These are business tools that are highly intuitive for our clients to adopt quickly and don't require huge levels of software development support to implement and maintain."

At Oracle's OpenWorld conference earlier this month, Radius announced a partnership with the software giant to help customers of its marketing suite utilize more predictive outreach tools.

But Dreamforce is a bigger deal for Radius. The company is a platinum sponsor, a distinction that comes with a $1 million price tag. Shirazi said all of his employees are likely to attend part of the event.

Radius will be conducting several tutorials and take part in a session with PwC's Kahn and a Sam's Club representative discussing the new product.

"We go all-in on Dreamforce," Shirazi said.

For Radius, the conference climaxes with an invite-only party next Tuesday night, featuring a live musical performance by Daughtry. The event is being billed as the Radius VIP Grand Prix Party.

Look for Shirazi in his racing gear.


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