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Ian Blair

Everything You Need to Know About SMS Marketing [Part 2]

Imagine if you had access to the one thing everyone has on their phones: the short messaging service, or SMS app.

Since nearly two-thirds of Americans are now smartphone owners, marketers are always seeking new methods for connecting to their customers through them. They’ve tried developing their own apps, featuring ads for their products on other apps, and a whole range of other ideas.

But there’s one strategy that consistently delivers impressive results:

Text messaging.

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Because the SMS app is the most frequently used mobile feature, marketers are using it to promote their companies and products like never before. And whether your business is a titan of industry or a mom and pop shop, you too can benefit from SMS marketing.

So, keep reading. By the time you’re done with this blog post, you’ll be well-equipped to execute a successful SMS marketing campaign.

 

What is SMS Marketing?

Put simply, SMS marketing is advertising your product to your customers over text messaging.

Such messages are sent phone-to-phone (or brand-to-phone) and are typically limited to 160 characters including spaces and punctuation.

Originally, some of the first brands to adopt SMS as a marketing tool were cellular providers themselves. But since then, countless companies both large and small have deployed their own SMS marketing programs.

Texting itself used to be a niche method of communication, but now adoption rates are estimated at well over 80 percent. As a result, marketers have seized on the opportunity to make use of the medium.

Why? Because it’s mobile, where consumers increasingly spend the bulk of their time.

And remember, it’s not just smartphones – regular cell phones (sometimes called dumb phones) have text messaging capabilities as well. If you have a customer’s number, there’s a good chance they’ll get your message.

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According to VentureBeat.com, the open rate of text promotions and offers is 98 percent. By comparison, the open rate of emails is a mere 20 percent. This makes SMS marketing the most effective channel for flash sales and same-day promotions.

And while email campaigns tend to primarily drive online sales, SMS marketing is effective at both referring customers to your website and bringing them to your physical locations.

Got your attention?

If so, let’s take a look at how running an effective SMS marketing campaign actually works.

 

How Does SMS Marketing Work?

If you’re ready to jump into SMS marketing, it’s crucial that you prepare properly.

The two basic components to an SMS marketing campaign are the keyword and the shortcode. Here’s an example:

Text “BONUS” to 555555 for your weekly special offers!

In this case, “BONUS” is the keyword to be placed in the body of the message. “555555” is the shortcode and it gets placed in the recipient box.

By responding to this message as directed, customers are effectively “opting in” to your campaign. Whether you send them a single automated message or add them to a list where they’ll be sent messages on a regular basis depends on the structure of your marketing campaign.

Numbers received this way have to be confirmed to make sure a customer didn’t enter a number incorrectly. Before adding them to the campaign, you’ll have to confirm their participation by sending another message that can look something like this:

Text “YES” to receive weekly special offers!

When you create your SMS marketing campaign, your main focus will be alerting customers to mobile coupons and discount codes. Everyone loves a deal, so when you offer your customers a chance to save, many will have no problem giving you their mobile numbers.

Last May, eMarketer (a website specializing in eCommerce and digital marketing), put out a story with fascinating data related to mobile coupons. Here are some of their findings and predictions:

  • By 2017, nearly half of US companies with 100 employees or more will distribute mobile coupons – via SMS marketing, email, mobile apps, and websites.
  • More than two in five companies in the US would use mobile coupons for marketing by the end of 2015, up 4 percent from 2014.
  • Coupons and codes distributed digitally are much cheaper than their paper counterparts, and also get redeemed more frequently.
  • The number of US adults who redeem digital coupons will grow 7.6 percent to 121.3 million. Mobile coupons will see growth of 18.4 percent to 97.4 million.

However, there are quite a few other things you can do with SMS marketing aside from coupons:

  • Drip campaigns: You can send increasingly better coupons depending on how long a customer has been subscribed. A 5 percent coupon after signing up, a 10 percent coupon after a month, a 20 percent coupon after 2 months, and so on.
  • Customer polls: Create polls to let customers cast their vote by texting various keywords. When you collect enough responses over time, you can graph and analyze the data.
  • Sweepstakes contests: If customers text a particular keyword, they’re signed up for a contest to receive free or greatly discounted products.
  • Group creation: You can divide customers depending on which keyword they responded to, how they voted in a poll, and more. This helps with targeting customers for specific promotions and coupons.
  • Location based marketing: Send different messages to customers based on their area codes.
  • Multimedia Messaging Service (MMS) Marketing: Send photos and videos to customers who can receive them – something especially useful if you have a solid creative department.

There’s little point in denying it – offering your customers promotional deals over their mobile devices is a smart business tactic. That’s why Coca-Cola spends 70 percent of their mobile budget on SMS marketing.

Now, what else should you know to have a successful SMS marketing campaign?

 

Understanding Your Marketing Campaign Goals

When you create your SMS campaign, try to take your current business goals into account. In other words, instead of thinking about the campaign as a separate strategy, incorporate it into your larger organized marketing plan.

What is your business looking for most out of the campaign? Do you need immediate sales? Are you trying to simply create a list for future SMS campaigns? Or, do you want to drive your customers to a specific action?

You need to understand that your SMS campaign will affect your business directly. If all goes well, you’ll you see more engagement from the customers who receive your SMS messages and benefit from enhanced brand recognition.

That’s why everyone involved with handling the SMS marketing campaign should always be kept up to speed. Communicating your vision, goals, and strategy as clearly as possible to your team is critical to your success.

 

Offering Incentives

The consumers who welcome you into their phone on a regular basis are probably some of your most loyal customers. And that’s not much of a stretch – our mobile devices are arguably the most personal items we own.

With that said, you should treat your most loyal customers with some extra love.

How?

Simple: by giving them something of value.

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Consumers receiving your SMS messages have to see a reason to remain opted-in and participating. And if you want to convert the recipients of your messages into paying customers, there has to be a clear incentive for them to want to do so.

As you build your phone number list in the early stages of your SMS campaign, start with low value offers based on small percentages or dollar-off coupons. Once you have a larger opt-in list, start using Buy One Get One campaigns, also known as “spend and gets.”

These “spend and gets” help by increasing the average order value (AOV) of your customers’ purchases, while self-funding your campaign.

And as long as you deliver value through incentives as the campaign goes on, your customers will stay opted-in and eager to get your next text.

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Permission is Required

If done correctly, SMS marketing will never feel invasive.

SMS marketing operates under the permission based marketing standard. In other words, every subscriber must give their expressed consent before joining your list.

And you absolutely cannot upload random phone numbers to your database. You don’t want to be in a heap of legal trouble, do you?

Customers learning about your marketing campaign can either:

  • Text a keyword to a short code
  • Submit their number via a web-form.

If they’ve done neither of these, then you don’t have permission to send them anything.

Also, no one likes receiving unsolicited messages. So when you get your customers’ numbers, be clear about what you will send.

 

Compliance is Key

After you’ve made sure your customers have given consent to receive the messages, you also need your SMS campaign to be compliant with the law.

The three main entities that govern the mobile industry are the CTIA, FCC, and the Mobile Marketing Association. Everything you do while SMS marketing has to fall under the guidelines given by these entities.

And the rules don’t always stay the same. New changes to the Telephone Consumer Protections Act (TCPA) took effect as recently as October of 2013.

These changes include:

  • The “established business relationship” requirement, which replaced the “prior written express consent” requirement.
  • “Prior written express consent” can’t be a condition of any purchase.
  • You must clearly display each of these to customers before they opt-in to your text marketing campaign.

The best way to account for “prior written express consent” is to include language like this:

By participating, you consent to receive text messages sent by an automatic messaging system.

For condition of purchase consent, you should include language like this:

Consent to these terms is not a condition of purchase.

And if you want to be extra compliant (you do), include a helpful disclaimer like, “Message and Data Rates May Apply.”

As long as you follow the rules, you should have no problem succeeding with SMS marketing. Here are some other examples of appropriate SMS language:

Opt-in confirmation

Thanks for signing up for BUSINESS NAME alerts! To unsubscribe, reply STOP. 5 msgs per month, msg&data rates may apply. Visit [URL] for help.

Opt-out confirmation

You are now unsubscribed from BUSINESS NAME alerts. Sorry to see you go! You’ll receive no further messages. For more info, visit [URL]. Msg&data rates may apply.

Double opt-in confirmation request

We have received a request to add your mobile phone number to BUSINESS NAME alerts. Please reply Y or YES to confirm your subscription. Msg&data rates may apply.

Directions on how to opt-out

Reply STOP to opt out of BUSINESS NAME alerts.

As long as you make messages like these a part of your automated system, you’ll be able to keep your customers happy and stay on the right side of the law.

 

Text Marketing Analytics

If you’re putting all this effort into your SMS campaign, you’re going to want to know if it’s working, right?

Fortunately, there are quite a few helpful metrics to follow when executing your campaign:

  • Subscriber growth: Each week, monitor your growth rate. Identify which activities make the list grow.
  • Subscriber churn rate: The rate at which people are opting out of your program over time. The ideal churn rate to shoot for is below 2-3 percent.
  • Redemption rate: The percentage of customers that redeem your offers.
  • Cost per redeeming subscriber: Based on the redemption rate, you can determine the cost of communicating with each customer.
  • Cross channel engagement: The different media platforms you use should have different keywords, which will help you quickly measure which locations are performing best.

As long as you keep track of this data, you should have no problem making any necessary changes to your campaign as it moves along.

 

Timing is Everything

One of the biggest worries companies have concerning SMS marketing is that their customers will think their messages are SPAM. And for good reason – no one likes SPAM.

Of course you’re going to lose tons of subscribers and possibly hurt your brand in the process if you abuse your phone number list and send out messages at all hours of the day – every day.

So don’t do that.

Remember, SMS marketing is a permission-based marketing channel. Your customers have opted-in to receive your messages – that means they want to hear more from you.

Depending on your product and whether you have a physical location, you may want to test to find the best results when it comes to message frequency. Figure out which days of the week are best for your customers, and which times of day they’ll be most receptive to.

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As you can see, there are clear peak hours of the day to shoot for when sending out your automated marketing messages.

So, if there’s one thing you take away from here, let it be this: do not send anything out before 9am or after 9pm. You’ll only be annoying your customers, and that’s the last thing you want to do.

 

Consistency for the Win

Surprisingly, one of the biggest mistakes businesses make when using SMS marketing is forgetting to send out messages on a regular basis.

Yes, you only want to send out messages when you have something of value to say. But if you go weeks without sending out any messages, you’ll probably end up with a high unsubscribe rate.

The happy medium here is to shoot for around once a week. Plus, if you have your team working on several weeks’ worth of text messages in advance, when the time comes you’ll always have content to send out.

Once you’ve figured out your ideal messaging rate, play around with it for long-term customers. Try and find what they prefer by asking them to take a survey or respond with a certain keyword.

You might even find that your customers want to hear from you more often!

 

Mastering Media Integration

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If you’re putting together an SMS marketing campaign, your brand is likely already on several other media platforms. So, when executing SMS marketing, take advantage of your collective outreach potential.

Some existing media outlets to use include:

  • Social media
  • TV
  • Radio
  • Email Marketing
  • Customer receipts
  • Print (newspapers and magazines)
  • Blogs
  • Any signage (if you have a brick-and-mortar store)
  • Website
  • Email

Keep in mind that every piece of promotional material you send out should include a description of your SMS marketing campaign, provide a resource for more information, and explain opt-in instructions.

And here’s another figure to remember: 15 percent of Americans own a smartphone but have a limited number of alternative ways to get online. When they come into contact with these other forms of media, the device in their hands will be a portal straight to your business.

So, by using all your brand’s media platforms, you can effectively extend your outreach and interactivity with users to create continued customer engagement.

 

Having a Clear Call-to-Action

Anyone receiving your SMS marketing should know exactly where to go for more information. This means your call-to-action should be the core of the message – not buried somewhere in the text.

Here are some ways of doing this:

  • Include a link or other explicit directions for how to connect and proceed.
  • Any offers need to be simple and easy to understand.
  • Don’t put parentheses around the shortcode. While it may seem obvious, many of those messages might not be sent properly because your customers included the parentheses when replying.

Here’s how Pepsi presented their SMS marketing campaign to customers:

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While Pepsi is an undeniably huge company capable of creating images like this one for their SMS marketing, they stuck to the simplest message possible:

Text “PEPSIMAX” to 710710 for your chance to live the game.

This made it easy for anyone who saw the advertisement to clearly understand the promotion and the directions to enter. Any call-to-action you create should have the same effect if you want to convert sales.

 

Conclusion

As you’ve seen, SMS marketing campaigns are a great way to expand your brand by helping you connect directly to your customers. By making repeat appearances on their phones, you’ll be staying put in their minds.

So, has your business tried SMS marketing? Share your experiences in the comments section!

 

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Ian Blair

BuildFire Co-Founder. I'm a digital marketer by trade and an entrepreneur at heart. I'm here to help businesses go mobile and build apps more efficiently than before.