Promoting a company or a brand through social media is simply the norm nowadays. So much so that marketing experts are now predicting that most of the successful companies will soon shift their focus to social media promotion alone, instead of clinging to traditional measures. Consequently, scores of start-ups across the globe are jumping into this space to make social media management easier and more effective. Bangalore-based Salorix, Inc feels its strategy of crafting multiple social media campaigns off one dashboard will be a differentiator.
Incorporated in March 2009, Salorix offers a full range of social marketing solutions â€“ right from listening to consumers' opinions to campaign planning, execution, analytics and reporting. What's more, all social media activities can be carried out through a single user interface that supports multiple social channels like Facebook, Twitter, LinkedIn and YouTube, as well as blogs and websites.
Salorix was founded by Santanu Bhattacharya, a B.Tech from IIT-Mumbai and an alumnus of MIT's Sloan School. Besides the founder-CEO, there is also Madhu Therani who has done his B.Tech from IIT-Madras and a Ph.D. from the Tepper School of Business/Robotics Institute at Carnegie-Mellon University. Therani is the chief technology officer (CTO) at Salorix.
There are already some believers in the company's business model as Salorix raised series A funding led by Inventus Capital Partners and Nexus Venture Partners. The company that has offices in Bangalore, Santa Clara and New York with 35 employees on board, is now mentored by Kanwal Rekhi, managing director at Inventus Capital Partners and co-founder of The Indus Entrepreneurs (TiE).
The Concept & Early Roadblocks
As social media continues to move toward business integration, one cannot possibly ignore the growth of Big Data in this space and its overall impact on businesses. According to a joint study by Booz Allen and social platform developer Buddy Media, 57 per cent of the businesses surveyed plan to increase social media spending while 38 per cent of the CEOs label it as a high priority. Yet, very few companies are going beyond information sourcing and data indexing at this stage. Collecting relevant information from the Internet and analysing the same to track consumer sentiments for optimising business growth happen to be a mammoth task that requires time, efforts and specialisation. Also, a lot of companies now rely on the manual process for campaign management which is a costly affair.
"People were looking at social media data but really didn't know how to leverage it. So we decided to utilise that information and develop effective campaign management solutions," explains Bhattacharya.
But it was easier said than done as he had to define the firm's service offerings (there was a distinct lack of precedents) and convince the customers-to-be that social media campaigns are important for businesses. In fact, the biggest challenge was to educate clients on essential factors like how critical social media management is for a business, social media data measurement and the importance of customer behaviour on social platforms.
Another big concern was to hire the right people for the job. Because the vertical was entirely new and everyone was still learning, the team didn't know at first how to use social media for effective advertising and business promotion.
The firm also had concerns regarding definitional challenges as there was no tool to measure the success of social media campaigns. Even now, Interactive Advertising Bureau is slowly defining the standards.
Operations & Biz Model
In spite of the initial hurdles, Salorix was able to acquire a few customers soon after its launch and that had helped the company survive the downturn. "The customers we initially acquired were looking for someone who could handle Big Data for a nominal price during the recession. As I have some exposure to analytics, we managed to get our first customer Billeo in August 2009," recalls Bhattacharya. Incidentally, Billeo is an online shopping assistant and payment service company catering to consumers and small businesses.
The social media campaign firm currently provides digital marketing and analytics solutions to some of the largest brand advertisers, publishers and agencies. The company unifies data and analyses across social media channels, and manage campaigns on multiple social networks from a single platform in order to ensure efficient co-ordination of messaging and publishing activities.
Salorix buys all relevant data from Gnip, IceRocket and a few other providers who aggregate the raw data from various social media channels.
The company currently works with digital agencies of leading brands like Levi's, Lindt and Volkswagen, and other brands like Blue Shield and AARP to help them optimise their digital and social marketing campaigns.
While Bhattacharya did not reveal revenue numbers, the company is in talks with major brands in the USA and is said to have received enquiries from Indian brands after it raised funding from VC firms. The founder-CEO said the company is still in a pre-profit stage.
Competition & Growth
If the lack of corporate awareness was one of the initial roadblocks for Salorix, growing competition, consumer engagement and scaling up may also pose problems during the next phase of growth.
According to Bhattacharya, there are about 400-500 companies in this domain but the company's USP is somewhat unique and that ensures a competitive edge. "Very few companies are looking at campaign management as a full-cycle process and only offer partial services," explains the entrepreneur. "So there are few real competitors in this space and those include companies like Radian6 (now part of Salesforce.com) and Nielsen's BuzzMetrics who offer brand monitoring, brand connections & customer relations, and consumer insights," he adds.
However, the space is witnessing enormous growth, according to investors keeping a tab on the industry.
Fundraising & Future Plans
Initially, Salorix raised $500,000 in debt finance from an unnamed California-based investor against company shares. Under the deal, it was agreed that the shares would be returned to the firm as and when the money would be paid back to the investor. Also, the funding from the individual investor was received in tranches. Salorix raised $100,000 at first to achieve a targeted revenue rate, followed by another $1,50,000 to reach the next milestone and the rest of the funding came likewise.
However, in May 2011, the company raised $3.5 million in series A funding, led by Inventus Capital Partners and Nexus Venture Partners. The proceeds will enable the company to advance its technology development efforts and provide customers with expanded solution sets for managing their social media campaigns effectively.
"Interestingly, just 15 minutes after we had our first meeting with Nexus, I got an e-mail message that said they would like to invest in our company," recalls Bhattacharya. "It was too soon for us because we just had a discussion with another investor. But eventually, we finalised the deal with Nexus after talking to a few other funds."
Jishnu Bhattacharjee, Principal at Nexus Venture Partners which has invested in Salorix says, "Salorix is the first turnkey technology platform for social media monitoring, campaign planning and execution for brands. The team is one of the best in terms of machine-learning expertise required to extract meaningful data out of the deluge of social media information."
Finally, what is Santanu Bhattacharya's vision regarding Salorix?
While short-term targets are well-defined, his long-term vision is quite ambitious. "When people think search, they think Google. When people think about social media engagements, it should be Salorix," he concludes.
We will keep a tab on whether Salorix is able to build itself that big now that it has some god financial backers to propel its strategy. Watch out for our updates on the team.