April 26, 2011, 9:53 AM — This is the second part of my conversation with Clara Shih, CEO of Hearsay. If you missed Part 1, you can read it here. To briefly recap, Clara and I worked together at salesforce.com and have now run back into each other given my social business research focus at IDC and Hearsay's focus on social media monitoring and management. Given the challenge that companies are facing with maintaining their various social media properties and initiatives, I thought it would be fun to have a mini Q&A session with Clara and have her share insights on social media monitoring, using Facebook, and how Hearsay has been helping its customers. Part 2 of my discussion with Clara focuses on regulatory issues, using Facebook, and how Hearsay addresses customers' challenges with social media.
Erin: What industries need to be concerned about compliance and what regulations do companies need to be aware of when planning their social media strategy?
Clara: The financial and healthcare industries are well accustomed to heavy regulation by SEC/NYSE/NASD/FINRA and FDA respectively. In 2009, MetLife Securities Inc. reached a multi-million dollar settlement with the Financial Regulatory Authority (FINRA) for violating MetLife's internal policy on archiving email correspondence. Per regulatory guideline FINRA 10-06, social media is treated in the same manner as email for purposes of archiving and financial reporting. FINRA and other regulatory requirements are now being extended to include social media:
- Records retention (data archiving) and e-discovery of electronic communication in case of audit or subpoena
- Monitoring and review of correspondence and social network profiles
- Financial reps are prohibited from making predictions about market performance
- Drug and medical device companies are prohibited from promoting off-label use
But legal and compliance concerns extend beyond highly regulated industries:
- All business advertising in the US is regulated by the Federal Trade Commission (FTC), which has cracked down on product endorsements on blogs and other social media which fail to disclose whether favorable reviews were paid for by companies.
- Restaurant and retail franchises and chains, and other businesses which employ hourly wage workers need to consider how state labor laws apply to workers who engage in social media conversations on behalf of the business (for example, posting or commenting on a Facebook Page) after hours. In California, for example, such activity even if unsanctioned by the company, might require overtime pay.
Erin: Are there any social media best practices when it comes to Facebook that you can share with our readers?
Clara: I'll reiterate the “five steps to hitting a home run on Facebook” from the marketing webinar I taped at Facebook headquarters last week (watch it here -click on the Education tab):
Erin: How does Hearsay help its customers with Hearsay Social? Are there other vendors addressing these issues?
Clara: Many brands are discovering that their local reps, employees, agents, and franchisees have created pages and profiles on social networking sites which are out there representing the brand and for which the company is liable. Hearsay Social is a social media compliance and content distribution platform which allows brands to monitor, support, and help manage these multiple social media assets by being able to push out content and campaigns from corporate to local while staying compliant with federal regulations. Here is a fun 90-second video about how Hearsay works.
Across the social landscape, there are a number of vendors that focus on other areas in the enterprise, such as Salesforce.com/Radian6 and Visible Technologies for monitoring and service, Jive and Lithium for private-label communities, or Spigit and BrightIdea for ideation. On the compliance front, a number of traditional on-premise players such as Actiance and SunGard are now moving into social media.
Erin: How long does it take for customers to realistically get up and running on Hearsay Social? What do they need to do in order to use Hearsay Social and really take advantage of their investment?
