Hearsay Helps Corporate America Get Local, and Get Smarter About Facebook and Twitter

If you’re an ambitious store manager at Starbucks, an agent for State Farm Insurance, or even a paper salesman for a branch of Dunder Mifflin, then of course you’re setting up your own local accounts on Facebook and LinkedIn and Twitter. You are certainly reaching out to customer with updates and special offers. It would be dumb not to use the power of social media to form authentic connections with your local market.

But you can be sure that back at corporate headquarters, this fact is giving some senior vice-president a panic attack. After all, what’s to stop all those local representatives and agents and franchisees from misusing the company brand, offending customers, letting their accounts go embarrassingly silent, or—even worse—getting the company into regulatory trouble?

Ever see an episode of “The Office?” I rest my case.

This is the problem Hearsay has set out to solve. After nearly two years in stealth mode, the San Francisco-based startup today unveiled a social media platform for businesses that gives big companies a way to guide the social media exploits of local representatives—but without over-mothering them.

Co-founder and CEO Clara Shih says Hearsay’s SaaS-based service is designed specifically for a breed of companies she calls “corporate/local.” Essentially, these are companies with a strong, overarching brand, but lots of local agents or store managers. The social media explosion, she says, brings these organizations “tremendous opportunities on the marketing and sales side, but also tremendous challenges that no one had figured out. How do you align your local branches and representatives around your corporate brand and industry regulation, while empowering those branches and representatives to express a unique and authentic voice? It’s a fine and delicate balance to walk.”

Hearsay’s system, called Hearsay Social, amounts to a kind of corporate front-end for Facebook, Twitter, LinkedIn, and Yelp. Companies that sign up for the service—which is available for a monthly subscription fee based on the number of branches—don’t necessarily force their local representatives into becoming social-media mavens. But they do make the reps who are already active on social media use Hearsay as the gateway.

The system is built around three pillars, according to Shih: content, compliance, and metrics. In the content area, corporate managers can provide standardized templates for social media profiles—so that every State Farm agent’s Facebook page has the same look and feel, for example. They can also create national or regional social-media promotions, which local representatives can then choose to pass along (or not) as a way of supplementing their own local status updates or tweets. “It gives the ability for corporate not to control, but to seed the local conversation, and make it easy for local branches and representatives to look smart,” Shih says.

In the compliance area, Hearsay’s tools provide basic filtering, to make sure that local representatives don’t broadcast anything that includes profanity, personally identifiable information, or blacklisted expressions. For regulatory compliance, for example, insurance companies generally don’t want their agents talking with customers about stocks, bonds, and other investment matters.

Finally, Hearsay’s social media portal provides each company and each branch representative with analytics dashboards, so they can see how many friends or followers they have and how many people are retweeeting tweets on Twitter or “Liking” status updates on Facebook. There are also built-in customer relationship management tools that allow branch representatives to track and annotate individual friends, fans, and followers. “An insurance agent will do this for the hottest leads or customers,” Shih explains. “You might scroll down and see the history of your interactions–when Chris became a fan of your page, the notes you’ve taken about him, the fact that his son is turning 16 next week and will need insurance.”

The one thing Hearsay can’t measure, of course, is whether this blur of social media activity translates into actual sales. But Shih says the company’s customers don’t really need convincing on that score. “Businesses recognize the inherent value in relationships and loyalty,” she says. “When insurance agents send you a holiday card, they’re not tracking that back to whether you buy more premium products. They’re just investing in the relationship. That same set of values motivates them to get on Facebook and LinkedIn and Twitter.”

Shih was motivated to start Hearsay by her experiences writing The Facebook Era, a 2009 book about the business uses of the social Web. Back in 2007, while still a marketing executive at San Francisco-based Salesforce.com, Shih had built Faceforce (later renamed Faceconnector), an app that allowed Salesforce users to pull updates from their contacts’ Facebook profiles into their Salesforce records. Hailed as the first real business application ever created for Facebook, Faceforce brought Shih tremendous attention, as well as the book contract, which led to a year of research on the social media landscape.

“A lot of the companies I spoke to wanted the same things, and that made me think there was a good opportunity to build a software company to address these common needs,” Shih recounts. So in mid-2009, she left Salesforce and persuaded a former Stanford classmate, Steve Garrity, to leave his own job as a cloud and mobile program manager at Microsoft to co-found the company, which started out under the name Hearsay Labs.

Today, the 30-employee startup already has more than 30,000 users at a bevy of high-profile client firms, including State Farm, Farmers Insurance, and 24 Hour Fitness. In fact, the company is cash-flow positive, Shih says. But that didn’t stop it from raising a round of financing—just under $3 million, from Sequoia Capital and a club of search and social networking tycoons including Michael Abbott (vice president of engineering at Twitter), Steve Chen (co-founder of YouTube), David Lawee (vice president of corporate development at Google), Dave Morin (co-founder and CEO of Path and a former Facebook executive), Alberto Savoia (engineering director at Google), and Aaron Sittig (product architect at Facebook).

“We didn’t need the money, but we’re so glad we did it,” says Shih. “Sequoia has brought a wealth of insights and contacts.” Sequoia partner Bryan Schreier, a former Googler, oversees the firm’s investment and recently joined Hearsay’s board.

I asked Shih whether she ever worried that her platform—which, after all, is designed to tip control over social media activity back to the corporate side of corporate/local organizations—might lead to a general decline in the quality and authenticity of conversations with customers, or to an explosion of Twitter and Facebook spam. With every new communications medium, she said, there’s a danger of corporate co-optation. But in the case of social media, she pointed out, that danger is mitigated by the fact that connections are opt-in. If a company’s representatives start sharing boring or spammy updates, “people will simply vote with their feet and unfriend you,” she says.

“Facebook and Twitter are powerful because for the first time, people can elect which friends and companies they want to stay connected with,” says Shih. “If anything, this introduces a new level of accountability and real-time feedback. It’s those who truly have a unique and authentic voice who are able to keep in continual touch with their customers.”

Here’s a video Hearsay created to explain Hearsay Social.

Wade Roush is a freelance science and technology journalist and the producer and host of the podcast Soonish. Follow @soonishpodcast

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One response to “Hearsay Helps Corporate America Get Local, and Get Smarter About Facebook and Twitter”

  1. Although, I’ve provided an alternative e-mail address, I still received all facebook inquires on my primary address, including one that was a virus, thank goodness I have a Mac. or I would have lost everything, trying to be considerate, I went to Facebook to try and warn them that someone on a friends site has a virus, there was nothing I could find. Next I tried going to a corporate site no such site for a mere facebook respondent like myself. If they can’t protect their site, I need to get off it fast and guess what that is also difficult to do.