As one-to-one messaging has grown more in popularity since the emergence of social media so to has Short Message Service (SMS) marketing, also known as text message marketing.
SMS is a lot like email marketing in that you have to build a subscriber list and then you send out messages but but the main advantage to businesses is that SMS is multiple times more effective at getting attention than email.
SMS marketing (SMS advertising) has allowed businesses to gain exclusive access to their customers in a way that not even social media can compete and that is the SMS inbox.
For example:
- How many email marketing messages do you ignore?
- How much of a priority do you place on social media messages?
Now compare that to SMS, how likely are you to prioritse reading an SMS message over social or email?
| Communication Method | Average Response Time |
|---|---|
| Text Messages | 90 seconds |
| Social Media | 1-4 hours (varies) |
| 12-17 hours |
Imagine being able to reach your customers in 90 seconds as opposed to a few hours?
That is why SMS marketing is a big advantage in today’s digital marketing world now we’ll focus on exactly what SMS marketing is…
Types Of SMS Marketing
SMS marketing can be categorized into two main types:
1. Transactional Messages
Transactional messages are vital for facilitating seamless interactions with customers. These messages serve as responses to customer interactions and include important updates such as payment invoices, shipping notifications, and support responses. For example, when customers order food through an app, they can receive timely SMS updates from the delivery driver, keeping them informed about the status of their order.
2. Promotional Messages
Promotional messages are intended to communicate promotions, such as coupon codes, special offers, and discounts. These messages can also include business updates that are not directly related to a specific customer interaction, such as announcements about new locations, extended hours, or upcoming events.
Before diving deeper into SMS marketing, it’s essential to familiarize yourself with the following glossary of essential terms:
- Short Message Service (SMS): These are short text messages that are completely in text without any media.
- SMS Keyword: Specific words or phrases that customers text to your business to opt-in to your text marketing messages.
- Call to Action (CTA): The action you want your target audience to take after receiving your message (e.g., reply, visit your website, leave a review, or call your business).
- Click-Through Rate (CTR): The percentage of recipients who click on a link or respond to the CTA in your SMS marketing message.
- Conversion Rate: The percentage of recipients who complete the desired action prompted by your CTA.
- Opt-In: The act of giving consent for a business to send you text messages.
- Opt-Out Rate/Unsubscribe Rate: The percentage of subscribers who choose to stop receiving text messages from your business.
- Spam Act: The Spam Act 2003 is an Australian law that regulates commercial electronic messages, prohibiting the sending of unsolicited messages with an Australian link. The Spam Regulations 2001 protect people from receiving spam and regulate email, SMS, MMS, and instant messages.
- Quick Response Code (QR Code): A scannable image that directs users to your SMS marketing sign-up page, allowing you to gather opt-ins online, face-to-face, or in-store.
- Texting Service Software: A platform that allows you to manage SMS marketing campaigns, conversations, and opt-ins effectively.
- Short Code: A 5-6 digit number used to send SMS or MMS messages, typically used for one-way bulk messaging and more expensive to maintain than long codes.
- Long Code: A 10-digit number used to send SMS and MMS messages or make calls, giving messages a more personal appearance as if they were sent by an individual.
- Personalization Variable: Dynamic fields that pull specific information into SMS messages to tailor them to each recipient, such as their first name or a location-specific offer.
5 Big Benefits of SMS Marketing
The advantages of SMS marketing are numerous and compelling, making it an essential component of any successful marketing strategy. Here are some of the key benefits:
1. Reach Customers Faster
With 95% of text messages being opened within three minutes of receipt, SMS marketing allows businesses to reach their customers faster than ever before. If you have time-sensitive information to share, such as a limited-time offer or a flash sale, SMS is the ideal medium to ensure your message is seen and acted upon promptly.
2. Increase Response Rates
SMS marketing boasts significantly higher response rates compared to other marketing channels. According to industry statistics, customers are 134% more likely to respond to an SMS than an email. This increased engagement opens up opportunities for further interactions and conversions.
3. Complement Other Marketing Channels
While an SMS marketing strategy can be effective on its own, it can also be used to enhance other marketing channels. For example, you can use SMS to promote a contest or sale on social media, increase your email newsletter subscribers, or remind customers of an upcoming event or webinar to boost signups.
4. Build Customer Loyalty
SMS marketing allows businesses to send personalized messages and offers to individual customers, fostering a sense of exclusivity and value. This personalized approach can help build customer loyalty and increase the likelihood of repeat business.
5. Increase Revenue
By driving traffic to your store or website through targeted SMS campaigns, businesses can boost their revenue. SMS messages can be used to promote special sales, events, and reminders to complete cart purchases, seamlessly integrating with your brand’s overall marketing efforts.
6. SMS Marketing Best Practices
To ensure the success of your SMS marketing campaigns, it’s crucial to follow industry best practices. Here are some key tips to help you get the most out of your efforts:
1. Obtain Explicit Consent and Opt-In
In compliance with regulations, it’s essential to obtain explicit consent from recipients before sending them SMS marketing messages. This can be achieved through opt-in forms on your website or other channels. Additionally, it’s advisable to send an initial text thanking new subscribers and asking them to confirm their opt-in with a simple “Yes” or “No” reply.
2. Make it Easy for Customers to Opt-Out
Respect your customers’ preferences by making it easy for them to opt-out of receiving your SMS messages. This can be as simple as including an “Unsubscribe” or “STOP” option in your messages, allowing customers to easily unsubscribe if they no longer wish to receive your communications.
3. Identify Your Brand Early
To establish trust and credibility, it’s essential to identify your brand early in your SMS messages. Start with your brand name, followed by an enticing offer or promotion within the second sentence. This approach ensures that recipients recognize the sender and are more likely to engage with your message.
4. Keep Messages Concise
SMS messages have a character limit of 160, so it’s crucial to keep your content concise and to the point. Eliminate unnecessary information and focus on delivering a clear and compelling message that includes your brand name, an offer or promotion, a strong call-to-action, and an opt-out option.
5. Maintain a Consistent SMS Marketing Strategy
Consistency is key when it comes to SMS marketing. Find the right balance in terms of message frequency to avoid overwhelming your subscribers while keeping your brand relevant. Develop a consistent strategy that aligns with your overall marketing goals and ensures a positive customer experience.
6. Adhere to Privacy Laws and Regulations
Ensure that your SMS marketing campaigns comply with relevant privacy laws and regulations, such as the Telephone Consumer Protection Act (TCPA) and the General Data Protection Regulation (GDPR). Obtain express written consent, include your business name, provide clear terms and conditions, offer an opt-out option during business hours, and respect consumer privacy and rights.
The Main SMS Marketing Strategies
SMS marketing offers a wide range of strategies to engage with your customers and drive conversions. Here are some effective strategies with examples:
Welcome Messages for New Subscribers
Once a customer subscribes to your SMS marketing campaign, send them a welcome message to ensure they know they’re subscribed and to set the tone for future interactions. You can even include a coupon code or special offer as an incentive.
Announcing New Product Releases
Use SMS marketing to announce new product releases and create buzz around your offerings. Include a direct link to your website or store to drive traffic and encourage customers to check out your latest products.
Abandoned Cart Recovery
With an average cart abandonment rate of 70.19% for e-commerce businesses, SMS marketing can help recover some of that lost revenue. Send abandoned cart messages to customers who have left items in their online shopping carts, offering a discount or incentive to complete their purchase.
Back-in-Stock Notifications
Notify your customers when previously out-of-stock products are back in stock. This ensures that they don’t miss out on the opportunity to purchase desired items and can help drive sales.
Collecting Customer Feedback
SMS marketing can be an effective tool for gathering customer feedback. Create short surveys using tools like Google Forms or SurveyMonkey and send the link via SMS. Alternatively, ask customers to reply with a rating and follow up with those who provide low ratings to identify areas for improvement.
Providing Text-Based Customer Service
Businesses with a mobile workforce, such as plumbers or delivery drivers, can leverage SMS marketing to provide text-based customer service. Customers can send a text instead of making a phone call, saving time and reducing disruptions for both parties.
Requesting Product/Service Reviews
Many companies use SMS marketing to gather reviews about their products or services. For example, companies like Uber ask customers to rate drivers after their ride, providing valuable feedback on the customer experience and identifying areas for improvement.
Promoting Online and In-Person Events
SMS marketing can be an effective way to promote upcoming events, both online and in-person. Include details such as date, time, location, and a call-to-action to encourage people to buy tickets or sign up. You can also include hashtags to promote on social media and RSVP links for limited spots.
Implementing VIP Programs
Offer exclusive discounts, early access to sales and new products, and other benefits through a VIP program. Promote your VIP program through SMS messages and encourage customers to sign up, fostering a sense of exclusivity and loyalty.
SMS Marketing Campaigns
SMS marketing campaigns can be broadly categorized into three types: promotional, transactional, and conversational.
Promotional SMS Campaigns
Promotional SMS campaigns are designed to generate interest in a product or service. These campaigns can include discounts, coupons, and special offers. For example, fashion brand Jenni Kayne sent a personalized coupon code and a direct link to their shop page to their subscribers.
Transactional SMS Campaigns
Transactional SMS campaigns are sent in response to a customer’s action or event. These messages provide time-sensitive information, such as order confirmations, shipping notifications, or password resets. Baking Steel, an e-commerce brand, sent an order confirmation message that included tracking information and an unsubscribe option.
Conversational SMS Campaigns
Conversational SMS campaigns involve two-way SMS conversations, mimicking human interactions. These campaigns blend natural language processing for lifelike digital chats, combining human agents and automated texts for effective customer engagement and retention.
Measuring Success and ROI
To ensure the effectiveness of your SMS marketing efforts, it’s essential to measure and analyze key performance indicators (KPIs) and calculate the return on investment (ROI).
Key Performance Indicators (KPIs) for SMS Marketing
- Click-Through Rates (CTR): The percentage of recipients who click on a link within your SMS messages. A high CTR indicates that your message is compelling and driving desired actions.
- Conversion Rates: The percentage of recipients who complete the desired action prompted by your call-to-action (CTA), such as making a purchase or signing up for an event.
- Opt-Out Rates: The percentage of subscribers who choose to stop receiving your SMS messages. Monitoring this metric can help you measure subscriber satisfaction and identify areas for improvement.
Analyzing and Interpreting SMS Campaign Data
Utilize sophisticated tracking tools and analytics to understand your campaign performance and identify areas for success and improvement. By analyzing metrics like open rates, CTR, and conversion rates, you can extract actionable insights to optimize future campaigns.
Calculating Return on Investment (ROI)
To determine the effectiveness of your SMS marketing efforts, it’s crucial to calculate the return on investment (ROI). Compare the revenue generated from your SMS campaigns to the costs associated with sending the messages, including any software or platform fees. A positive ROI indicates that your SMS marketing strategy is successful and profitable.
SMS Marketing Platforms and Tools
To streamline your SMS marketing efforts and maximize efficiency, consider utilizing dedicated SMS marketing software and tools. Here are some key features to look for:
- Bulk SMS Capabilities: The ability to send mass text messages quickly and easily.
- Two-Way SMS: The ability to send and receive replies, enabling conversational SMS marketing.
- Integrations: Seamless integration with existing systems such as CRM, e-commerce platforms, and marketing automation tools.
- Automation: Automated messaging and campaign workflows to save time and improve ROI.
- Personalization and Segmentation: Options to personalize messages and segment your audience for targeted campaigns.
- User-Friendly Interface: An intuitive and easy-to-use platform for managing campaigns and analyzing data.
- Security Features: Robust security measures, such as two-factor authentication (2FA) and toll-free numbers, to protect your business and customers.
- Customer Support: Reliable customer support to assist with any issues or queries.
Compliance and Legal Considerations
Compliance with relevant Australian laws and regulations is crucial when implementing SMS marketing campaigns. Here are some key considerations:
Spam Act 2003
The Spam Act 2003 is the primary legislation governing commercial electronic messages in Australia, including SMS marketing. Key requirements include:
- Consent: Businesses must obtain express or inferred consent before sending commercial SMS messages.
- Identification: Messages must clearly identify the sender and their contact information.
- Unsubscribe: Every message must include a functional unsubscribe facility.
Privacy Act 1988
The Privacy Act 1988 and the Australian Privacy Principles (APPs) regulate how businesses handle personal information. For SMS marketing, important considerations include:
- Collection: Only collect necessary personal information through lawful and fair means.
- Use and Disclosure: Use personal information only for the purpose it was collected, unless consent for other uses is obtained.
- Data Security: Take reasonable steps to protect personal information from misuse, interference, loss, and unauthorized access.
Do Not Call Register Act 2006
While primarily focused on telemarketing, this Act can apply to SMS marketing in certain circumstances[3]. Businesses should ensure they don’t send marketing messages to numbers listed on the Do Not Call Register unless they have express consent.
To ensure compliance, implement clear opt-in and opt-out mechanisms, maintain thorough records of consent and subscriber interactions, and regularly review and update your SMS marketing practices in accordance with these Australian laws and regulations.
Future of SMS Marketing
As technology continues to evolve, SMS marketing is also adapting and evolving. Here are some emerging trends and innovations to watch out for:
- Integration with Other Technologies: SMS marketing is increasingly being integrated with other technologies such as chatbots, artificial intelligence (AI), and voice assistants, creating more comprehensive and personalized customer experiences.
- Conversational AI: The use of conversational AI and natural language processing will become more prevalent, enabling more natural and lifelike two-way conversations between businesses and customers.
- Omnichannel Approach: SMS marketing will be further integrated into omnichannel marketing strategies, seamlessly blending with other channels like email, social media, and push notifications for a cohesive customer experience.
- Personalization and Segmentation: Advanced personalization and segmentation capabilities will allow businesses to deliver highly targeted and relevant SMS messages, increasing engagement and conversions.
- Regulatory Changes: As consumer privacy concerns continue to evolve, businesses should be prepared for potential regulatory changes that may impact SMS marketing practices.
Conclusion
SMS marketing is a powerful tool that can significantly enhance your business’s marketing efforts and customer engagement. By following best practices, implementing effective strategies, and leveraging the right tools, you can unlock the full potential of SMS marketing and drive tangible results.
Remember, the key to successful SMS marketing lies in delivering value to your customers. Craft personalized, relevant, and timely messages that resonate with your audience, and respect their preferences by adhering to compliance guidelines.
As you embark on your SMS marketing journey, continuously measure and analyze your campaigns, adapt to emerging trends, and stay up-to-date with legal and regulatory changes. By doing so, you’ll be well-positioned to build strong customer relationships, increase brand loyalty, and ultimately, boost your business’s revenue.
Don’t hesitate to explore the world of SMS marketing and unlock a new level of customer engagement and success for your business.