SMS Marketing

In the age of instant communication, businesses must constantly find new ways to connect with their audiences where they spend their time. With SMS, also known as text marketing, businesses can communicate with consumers in the most direct, instant way possible.

Businesses benefit from the simplicity and affordability of SMS marketing. There’s no need for flashy graphics or elaborate design teams. Instead, a well-crafted, concise message can yield results driving customer engagement and sales.

The scalability of SMS marketing campaigns allows marketers to reach large audiences without a significant increase in costs while adding a personal touch by sending tailored messages and offers that are reasonable on an individual level.

Texts have an inherent immediacy and directness that command attention. Whether you’re announcing a flash sale, introducing a new product, or performing customer service tasks, SMS marketing can help you achieve your goals. Keep reading to learn more about SMS marketing, its benefits, and how it works.

SMS stands for "short message service" and refers to text messages. Conversational SMS marketing, also known as text message marketing, is similar to email marketing. However, instead of messages being delivered to subscribers’ inboxes, they’re delivered directly to their mobile devices in the form of a short text message.

Text messaging is immediate. Unlike other marketing channels like email, social media, and push notifications, these messages are typically opened and read within minutes, leading to high engagement rates.

It’s important to note that SMS is not the same as MMS, which stands for multimedia messaging service. While both are messaging services that send messages to mobile phones, MMS allows businesses to send multimedia content like images, videos, and longer text messages.

Comparing SMS vs. MMS can help you determine which type of texts to send your audience based on their preferences or the types of content you want to share.

Key benefits of SMS marketing for businesses

Having a direct line to your customers via SMS marketing allows businesses to personalize content, engage in real-time, build loyalty, and drive customer action.

This form of marketing ensures messages reach their intended audience, prompting action and increasing sales, making them effective for businesses in various industries ranging from services to e-commerce.

The benefits of SMS marketing messages for businesses include:

Direct and instant communication

Nearly everyone has a mobile phone. Sending your customers SMS messages allows you to reach your intended recipients easily, regardless of their location or what they’re doing. Mobile phones are almost always within arm’s reach, making them ideal channels for direct communication.

Additionally, because they’re an instant form of communication, text messages offer unparalleled timeliness. Events, sales, and promotions that are often time-sensitive can easily be communicated to customers, ensuring they receive timely information that can influence their purchasing decisions.

High open and engagement rates

The notification sound of an incoming SMS message often elicits an immediate response. With your customers glancing at their phones regularly, the likelihood of them seeing your messages is extremely high.

Other marketing channels don’t offer as impressive results as SMS marketing in terms of open and engagement rates. Because most texts are often read within just a few minutes, businesses can better ensure their messages are actually read.

Cost-effectiveness

Like email marketing, SMS marketing comes with relatively low costs, allowing businesses of all sizes to market to their target audiences. When balanced against their high open and engagement rates, this cost-effectiveness offers a return on investment (ROI) difficult to compete with.

Additionally, SMS is highly scalable. SMS marketing platforms allow you to choose an adaptable plan that grows with your business, accommodating any size business.

Personalized communications

Whether you're sending transactional messages or promotional text messages, SMS marketing tools enable businesses to create personalized messages that resonate with specific audience segments. You can segment customers by behavior, location, and other parameters to provide a more personalized experience with your business.

You can use customer service SMS messages to provide more direct two-way and personal communications. SMS is bi-directional, allowing customers to respond to messages in real-time, allowing them to provide feedback, place orders, or ask questions.

How SMS marketing works

A simple text message remains one of the most convenient ways to communicate with your customers. If you want to engage customers directly, SMS marketing might be exactly what your digital marketing strategy needs to take it to the next level. Understanding how SMS marketing works can help you create a foundation for your strategy.

Build and manage SMS subscriber lists

Before you can consider sending text messages to your customers, you need a subscriber list. You should receive explicit consent from customers before sending them a text message, ensuring they understand what they’re signing up for. Using opt-in mechanisms like forms can ensure you obtain consent and abide by existing laws.

Also, provide subscribers with the option to opt out of receiving your SMS messages. Customers should be able to do this easily by sending a certain response back to you in the form of a text. The instructions for opting out should be clear and concise.

You should also regularly update your subscriber list to ensure its effectiveness. People often change their phone numbers, so if you’re experiencing low engagement from some of your subscribers, removing them from your list might be beneficial while increasing your open and engagement rates.

Craft compelling text marketing messages

SMS content comes in the form of a text message. You’re limited by how many characters you use, with most platforms only allowing for 160. However, you don’t necessarily want to send your customers long text messages even if you can because the whole point is to make your content as engaging as possible.

Your content should be concise and use personalization whenever possible. Consider referring to the recipient by name or using data about past purchases to make the message feel tailored, fostering a stronger connection.

Your SMS messages should always end with a clear call to action (CTA). Whether you’re promoting a deal or simply want recipients to visit your website, the CTA tells them what to do next and can help guide their decision on whether to take action.

In addition to all these elements, you should test and optimize your campaigns. Testing different messages, CTAs, and formats can help determine what resonates best with your audience.

Choose the right time for SMS campaigns

Sending SMS campaigns at the right time can increase the engagement rate while reducing the potential for opt-outs. Understanding your audience, including where they live, can make a big difference. Always consider time zones to ensure you never send messages while someone is sleeping or another time when receiving a marketing message might be considered a nuisance.

With this in mind, you can also analyze past data to determine the best time to send SMS messages to your customers. For instance, you might find that SMS marketing campaigns sent at 10 a.m. have a higher engagement rate than those sent at 6 p.m.

Compliance and regulations

SMS marketing best practices include following compliance with various regulations. Like email marketing, SMS marketing has regulations associated with it. Missteps can lead to legal repercussions and a poor brand reputation. Complying with these regulations ensures that you respect the rights of your customers and can foster trust among them — benefiting both of you.

The Telephone Consumer Protection Act requires businesses to obtain express written consent before sending promotional SMS campaigns and mandates the inclusion of an opt-out mechanism in every single message.

For European audiences, you’ll need to follow General Data Protection Regulation (GDPR). GDPR dictates strict rules about personal data collection and use. Consent must be explicit, with users having the right to access, modify, or delete their data.

The easiest way to ensure compliance is to have clear opt-in and opt-out mechanisms in place when sending bulk SMS messages. You should maintain thorough records of consent, subscriber interactions, and list management to demonstrate compliance if it ever comes into question.

Capturing and retaining customer attention is marketers’ number one priority. Unfortunately, it’s easier said than done. As brands continue to test new marketing mediums, SMS has been proven effective. To harness its potential, you’ll need a robust strategy that includes:

Segmentation and targeting

Knowing your audience is the first step to a successful SMS marketing strategy. By segmenting your audience, you can tailor your messages more effectively and achieve better engagement. You can use demographic segmentation by classifying your audience based on age, gender, location, or occupation. A skincare company might send different promotions to different segments based on age.

Customer data can also help you craft more personalized and compelling content. For instance, something as simple as using the subscriber’s name can make the message feel more personal. Celebratory messages and special offers during birthdays or special occasions can also have a similar effect.

You can also use behavioral segmentation based on purchase history and website interactions to send targeted messages. If someone recently purchased a pair of jeans, your next SMS message to them might recommend a certain top with a discount code they can use.

Integrating SMS with other marketing channels

Cross-promoting using SMS and other channels like email and social media can yield even better results. At the same time, leverage SMS marketing’s strengths to your advantage. Use SMS marketing for timely reminders or flash sales and other channels for more detailed communication.

You can also use SMS marketing to solicit feedback after customer interactions across channels. Once they make a purchase on your website, you can send them an SMS asking for feedback.

All communications with customers should provide them with a consistent experience, regardless of the marketing channel. This consistency reinforces the campaign's messages and enhances brand recall. Ensure the tone, language, and style remain consistent across all SMS messages and align with your brand identity.

Promotions, offers, and discounts

SMS marketing is ideal for driving sales and engagement through promotions, offers, and discounts because they create a sense of urgency and FOMO — fear of missing out — that makes customers want to take action. The direct and instantaneous nature of SMS allows you to offer limited-time offers to subscribers, drastically shortening the time it takes for them to make a decision.

You can also send subscribers exclusive discounts as a reward for their loyalty to drive sales while enhancing the appeal of signing up to receive marketing messages. Exclusive previews, limited spots, and testimonials also appeal to your subscribers’ FOMO.

By notifying them of exclusive offers, you make them feel more privileged. Telling them about limited spots or product availability can drive quick decision-making, while testimonials demonstrate how others are enjoying your products or services and make customers want to join in.

As with any marketing channel, measuring the efficacy of SMS marketing and understanding your return on investment is crucial.

Key performance indicators allow you to monitor your campaign performance and fine-tune your SMS marketing strategies to enhance their effectiveness. If you’re new to SMS marketing, there are only a few KPIs you should know, such as:

Open rates

The open rate for SMS marketing is the same as it is for email marketing — it refers to the percentage of customers who opened your messages. Most people read their SMS messages quickly, so open rates for these campaigns are generally higher than other channels.

Measuring open rates provides your business with instant feedback about a campaign, ensuring that you’ve reached your intended target audience. Additionally, comparing your open rates with industry benchmarks and previous campaigns can give you insights into how well each SMS campaign is performing.

Tracking this KPI can also provide you with an indication of the continued success of your messages. If, over time, you entice declining open rates, it might indicate a diminishing interest among your subscribers.

Delivery rates

Deliver rate is the percentage of outgoing SMS and MMS messages received at their intended definition. They’re different from open rates in that for someone to open a text message, they first need to receive it.

Measuring delivery rates can help you determine how effective your distribution system is and identify issues with network carriers or subscriber phone numbers. A low delivery rate can indicate issues like invalid phone numbers or content filtering, which requires campaign adjustments.

You can ensure high delivery rates by following SMS compliance guidelines, like using opt-in mechanisms to ensure you receive consent and the correct phone number from recipients before sending your first message.

Click-through rates (CTR)

The click-through rate is the percentage of recipients who click on a link within the SMS messages. This metric is crucial for campaigns with goals of driving traffic to a website or landing page like a product page.

A high CTR indicates that your message is read and compelling enough to drive action in the form of a click. It also helps you determine your content’s effectiveness. Higher CTRs mean more effective content. Similar to open rate, use this metric to determine how to tweak your messaging or offers to improve engagement in the following campaigns.

Conversion rates

Open rates and CTRs provide insights into engagement, but conversion rates show the percentage of subscribers who took the desired action after clicking the link provided in the message, such as making a purchase, signing up for a newsletter, or completing a form.

A high conversion rate indicates that your complaint is driving both website traffic and is highly effective at converting that traffic into results. Additionally, you can determine if certain campaigns consistently deliver high conversion rates, suggesting that the offers or content better align with your audience’s desires.

Opt-out rates

Opt-out rates tell you the percentage of subscribers who chose to stop receiving SMS marketing messages from your business. Monitoring this metric can help you measure subscriber satisfaction.

An increasing opt-out rate might indicate overall dissatisfaction with your business or its campaigns. You might see spikes of opt-outs after a series of frequent messages, indicating too high of a campaign frequency.

A consistent and growing opt-out rate over several campaigns can highlight issues in your overarching SMS marketing strategy. For instance, you might be sending SMS communications at the wrong times based on your target audience’s location. At the same time, you might have a mismatch between subscriber expectations and the types of content you send.

Analyze and interpret SMS campaign data

Understanding the metrics behind an SMS campaign is crucial for gauging its success. Utilizing sophisticated tracking tools and analytics can help you understand campaign performance and find key areas for success while pinpointing improvement areas.

By analyzing metrics like open rates, CTRs, and conversion rates, businesses can extract actionable insights to improve their future campaigns.

Use Mailchimp to improve your SMS marketing campaigns. Our SMS marketing tools can help you create and measure SMS campaigns. Craft text-based, personalized campaigns that encourage customers to take action. Then, measure your campaign performance with our robust data and analytics tools.