Conversocial Raises $1.25M and Moves to New York to Turn Bitchy Tweets into Customer Service Opportunities

By Nathaniel Mott , written on September 4, 2012

From The News Desk

The average time between something happening and someone Tweeting to complain about it is less than 30 seconds, according to a study I just made up. Whether it's a delayed flight, a malfunctioning phone, or a poor customer experience (I’m talking about you, AT&T), anybody with a gripe and a smartphone can send a 140-character bitch-fest or post a snide reference to Facebook in less time than it takes to say “stop whining.”

All this social media kvetching means that customer service, once the backwater of a corporation, has become its most important customer-facing division. That’s because in our over-sharing culture, we are more than happy to complain about a defective camera or incompetent tech support, and these days a consumer’s influence spreads far and wide through Tweets and Retweets, Facebook posts, and blogs. Almost one in five customers (17 percent) surveyed in a 2012 study commissioned by American Express used social media to complain at least once over the course of a year. When respondents experienced good service, they told an average of 42 people about it (compared to just 9 for those who were not on social media). With service they perceived as being poor, they told 53 people, on average.

But the longer it takes to satisfy a customer, whose complaints are logged in a public forum visible to the world, the more likely the problem will snowball. Another study from earlier this year shows that 52 percent of Twitter users expect a response within two hours, and 81 percent expect a problem to be solved the same day they made complaint.

Joshua March, founder of Conversocial, a London-based maker of social media customer service software for businesses, estimates that almost a quarter of the people who become a fan of a company page do so to get customer service help and expert advice, and about half joined just for product information and updates. What Facebook calls fans are really customers, and should be treated as such.

“The conversations a company has with its customers over social media truly represent its brand,” March says, “often at the dynamic moment when point-of-purchase decisions are being played out.”

Conversocial has, in its short history, processed some 200 million customer service-related Tweets and Facebook messages since 2009, and has today announced a $1.25 million funding round led by DFJ Esprit. The money will help fuel Conversocial's US expansion with a sales office in New York. Competition from Radian6 (which was acquired by Salesforce last year), LiveOps, and CoTweet has pushed the company to expand as quickly as possible, and this latest round of funding will allow the company to hire a sales team big enough to continue the company's 100 percent growth since the beginning of the year.

That’s not a lot of money, but what’s interesting is that Conversocial is part of a transformational shift in business, where balance of power has shifted, and the customer has assumed greater power. Also, it’s a startup from across the pond, and we don’t see many of those. It’s expanding westward, which throws off my entire sense of geography.

Matthew Brazil, Conversocials' VP of sales, says that a combination of New York's talent pool and the low competition (compared to Silicon Valley) was key to the company's decision to move to the Big Apple. This seems backwards – New York startups are perennially complaining about the lack of talent – but Brazil says that London's talent pool is even worse.

"I can interview 100 people in London," he says, "and maybe find five that have enough social media experience [to work at Conversocial.]" Not so in New York, where he says that recruitment agencies and his own efforts have been able to find a viable candidate 50 percent of the time. That combined with the fact that many of Conversocial's clients (and potential clients) are in New York made the city a natural fit for the company's US expansion.

Conversocial analyzes every Tweet and Facebook message sent to a company's page and uses natural language algorithms to determine the urgency of each message. A number of other factors – whether or not the message contains profanity, whether or not the person had complained in the past, etc. – also have an effect on the order that messages are displayed in. The concept is simple (deal with the screaming, angry lunatic before the quiet, calm customer) and allows customer service reps to prioritize without conscious thought or laborious methodologies.

That prioritization matters when the Twitterati are calling for blood. Being able to identify and solve a problem in that timeframe can stop a bad situation from getting worse and turn a potentially damning moment into a chance for good publicity. Despite – and perhaps because of – Conversocial's focus on customer service, the company may end up creating the most effective social media marketing tool around.

[Image Credit: Wikimedia]