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How should financial advisors and representatives handle Facebook's new star ratings?

Facebook is testing out a five-star rating system that allows users to rate and review a professional’s Facebook business page. These ratings can be made by any user, which means the user does not have to demonstrate that they know the professional or are a customer.
For financial professionals, this poses a question: Does this star rating feature on Facebook present issues for Registered Investor Advisors (RIAs) pursuant to the “Testimonial” Rule 206(4) of the SEC Investment Adviser Act of 1940?
Rule 206(4) states that advertisements cannot “use or refer to testimonials” (which include any statement of a client’s experience or testimonial). This is true of advertisements in print materials as well as advertising on electronic forums such as a Facebook Business Page.
The SEC’s staff has consistently interpreted testimonials to include a statement of a client’s experience with, or endorsement of, an investment adviser. Therefore, the use of “social plug-ins” such as the new Facebook “Star Ratings” feature could be deemed a “testimonial” under the Advisers Act.
While members should consult with their own legal and compliance departments as to the application of this feature with regulations restricting advertisements and other communications with the public, we suggest that RIA’s with a Facebook page should not accept ratings or reviews on the social network.
Facebook has not made it possible to block this new ratings feature, but RIAs can use a workaround to prevent their page from receiving star ratings. This workaround requires the financial professional to remove the map of business location (see illustration  and steps below). Please note that by doing so the map of the business location will not appear on the business page.

  • On your business page, go to the “About” section under the logo.
  • On the next page, hover over the “About” section and click “Edit.”
  • To the right of the “Address” section, click “Edit.”
  • Uncheck the box underneath the map that says “Show this map on your page and enable check-ins.”
  • Click “Save Changes”

Hearsay Social has indicated to Facebook that this feature might present a compliance risk for RIAs, and we are working with them on behalf of our clients to advocate for a solution that allows the map, but does not prompt users for check-ins or reviews.
If you have any additional questions about compliance on social media or Facebook star ratings, please feel free to leave a comment below or contact us directly.
We will keep you posted as more features change!

Disclaimer: The material available on this blog is for informational purposes only and not for the purpose of providing legal advice. We make no guarantees on the accuracy of the information provided herein.

What the Facebook News Feed redesign means for marketers

Facebook this morning announced a major update to News Feed, aimed at making the popular service richer, simpler, and more beautiful.

The ultimate goal of Facebook News Feed, according to Facebook CEO Mark Zuckerberg, is to deliver “the best personalized newspaper” to every user.
That means providing a “broad diversity of content,” including high-quality public content from businesses and public figures as well as posts from friends and family. While being broad, News Feed should also allow users to drill down on specific topics that interest them.
Here are a few tips to consider when incorporating the new Facebook News Feed into your existing social sales and marketing strategy:

1. Share rich and visual content

In November 2011, according to Zuckerberg, photos accounted for 25% of News Feed stories. In January 2013, photos accounted for almost half of all stories. Additionally, posts from business pages, not friends, has increased from 15% of the News Feed to nearly 30%.

This data demonstrates that, more than ever, businesses like yours have an extraordinary opportunity to engage with customers and prospects on social media. In order to capitalize on this opportunity, brands and businesses must share rich and visual content on Facebook.
The previous version of News Feed only allotted 40% of screen real estate to the main content, including your Page posts. This allotment, says Facebook Director of Design Julie Zhou, has been greatly expanded, meaning the impact of photos and other visual content will likewise be widened. For businesses that run ads on Facebook, like Sponsored Stories, it’s essential that these also be made “richer and more immersive” to compete with other visual content in the stream.

2. Provide value to fans

While Facebook constantly tweaks its algorithms to make News Feed as relevant and personal to each user as possible, this is sometimes difficult with content coming from such a disparate group of sources. As a result, explained Facebook engineer Chris Struhar, users now have the option of choosing between the overall News Feed, an “All Friends” feed, and a “Following” feed, which only shows posts from businesses and brands.
This update will be welcomed by users, but it shouldn’t change much for businesses on Facebook. As long as you remain dedicated to providing value to fans, not in the form of self-promotional content but instead with relevant posts and photos, you will still surface in feeds and stay top of mind with your customers.

3. Share content that will work on any device

Rather than try to make Facebook for iPhone and other mobile devices look like Facebook on the Web, the Facebook design team has instead opted to port their mobile designs over to desktop. Ultimately, this will result in a more consistent Facebook experience across mobile devices, tablets, and the Web.

The value of this to businesses is that “they can think about how assets will look across different screens,” according to Facebook VP of Product Chris Cox.
Previously, marketers would have to jump through hoops trying to figure out how certain posts will appear to users on the Web versus users on mobile. Since this will no longer be the case, you can start planning your social media posts more holistically for sharing across Web and mobile.
As expected, the updated News Feed will roll out to users slowly, as Facebook collects feedback and works out kinks. Once they have a more polished version, the redesign will roll out more broadly.
Anyone curious to test out the redesign can join the waitlist here.

What Facebook Graph Search means for marketers

Facebook earlier today announced a new tool called Graph Search, which greatly expands the power of search on the social network.

Graph Search is essentially a search engine dedicated entirely to Facebook’s Social Graph. In the works for several years, according to CEO Mark Zuckerberg, Graph Search will be a powerful new way for users to search for people, places, and things within their personal network.
Want to know which of your friends live in San Francisco? Simply search “friends who live in San Francisco.” Looking for music recommendations? Search “music my friends like.” See more examples of how one might use the new feature on the page Introducing Graph Search.

Facebook Graph Search for sales and marketing

For brands and marketers hoping to make an impact on social media, today’s announcement is especially significant. As Graph Search rolls out in the coming weeks and months, more and more of your customers will increasingly rely on Facebook for their purchasing decisions.
As an example, somebody looking for a dining recommendation could search “restaurants in London my friends have been to.” In this case, it would be crucial for your business to  have a presence on Facebook with complete location information filled out. Similarly, you can imagine users searching for “insurance agents my friends trust.” Your business page should be the first result!
Here are a few tips to optimize your Facebook Page for Graph Search:
1. Update your business page
It has always been important to keep your business page up-to-date, but with Graph Search it will be even more crucial. Under your Page settings, select the right category and sub-categories for your business, pick a vanity URL, make your address is correct, and update other information for your business. Indexing piles and piles of business pages across the site, Facebook will be using this key information to accurately surface your page in Graph Search results.
2. Connect with your customers
Boosting the number of likes on your business page is good for more than bragging rights–with Graph Search, likes are your entry point into search results. Specifically, the more connections you have, the more likely your page is to show up in a search. Nothing is more valuable than a recommendation from a friend, and now what may have been passive connections on Facebook have become searchable recommendations. Make sure to connect with your most loyal customers so that their friends and family have a good chance of finding you.
3. Keep sharing great content
As always, consistently posting photos, links, and other valuable content to your business page will remain a cornerstone to your Facebook sales and marketing strategy. Before, it was mostly important for keeping up your EdgeRank, the algorithm that determines how and when your posts show up in customers’ News Feeds. Going forward, we expect EdgeRank will also play a role in ranking you in search results via Graph Search.
Facebook says Graph Search “is available now in a very limited beta program for English (US) audiences,” but we expect it will slowly roll out to more users over the coming months. In the meantime, stay tuned to the Hearsay Social blog for more information on Graph Search and other Facebook tools.

What Facebook Global Pages mean for marketers

Facebook recently announced a new Global Pages structure, enabling brands who are present in multiple markets to adapt their branding and messaging to the needs of local markets.

Depending on the country they’re logging in from, a Facebook user who connects to (for example) will see a localized version of the page with different cover photos, profile photos, apps, milestones, “About” information, and News Feed stories shown in the local language.
This is of interest because it allows the creation of content and messaging better aligned to the local market conditions, eliminating the need for corporate marketing departments to maintain multiple and disconnected Facebook Pages. Furthermore, it takes away some of the pains of having to manage and coordinate local pages by centralizing these in a hub and spoke model, with the added benefit of being able to track overall performance in a Global Insights dashboard. This new structure is currently only available to companies who have a direct relationship with Facebook such as Unilever, Holiday Inn, and Nestlé.
Moreover, today’s news validates the approach Hearsay Social has long advocated: there is a tremendous opportunity to establish trust and generate loyalty by facilitating proximity between a brand and its customers. We do, however, take it one giant leap further by enabling field agents and those that are in direct contact with their customers to strengthen their role of trusted adviser. Contact through social media interaction serves to strengthen this relationship even more because these trusted advisers can pick up on signals that someone at the country or corporate level would find difficult to manage.
Overall, this is a positive move for international companies as it reinforces corporate branding in the local market whilst reducing the risk of dispersing marketing efforts. Hearsay Social complements this approach with its “corporate-to-local model” and further activates the person-to-person relationships that are the ultimate proximity lever for establishing brand equity with your customers.

Ed. note: Register now for our 11/13 webinar to learn even more about the power of going local from Hearsay Social’s Head of Data & Analytics, Greg Kroleski:

Congratulations to both Facebook and Instagram!

The Walls at Facebook #4: Quotes to live by

Today Facebook announced that it would be acquiring Instagram, a wildly popular photo sharing mobile app that has accumulated nearly 30 million actively engaging users.
Both Facebook CEO Mark Zuckerberg and Instagram CEO Kevin Systrom shared the thrilling news earlier today.
We could not be more excited for our good friends Kevin and fellow co-founder Mike Krieger (who were Stanford classmates of Hearsay Social founders Clara Shih and Steve Garrity), nor for Facebook on the timely acquisition of one of the hottest and fastest-growing social communities on the planet. The move shouldn’t be surprising given Facebook’s growing focus on mobile, and the incredible mobile uptake and engagement Instagram has cultivated in such a short amount of time.
Mobile and social are the future of the Web, and photos and other highly shareable content are at the center of this.
Photo courtesy of @facebook on Instagram.