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What is SMS marketing? [Ultimate guide for starters]

Sep 12, 2019

Short Message Service (SMS) marketing is a means by which businesses and institutions use permission-based text messaging to communicate promotional or awareness messages to their audiences.


What is SMS Marketing?

Companies use this technique to build a robust database of subscribers, which in turn increases customer loyalty to their brand.  Once a customer opts-in your company’s marketing campaigns, their phone number is recorded and stored in the company database. The company then creates a lasting relationship with the customer through frequent SMS updates on upcoming events, sale offers, discounts, brand awareness, appointment reminders, as well as coupons.
Here, we discuss all what SMS marketing is and how to go about it.


#1 | Master the Basics of SMS Marketing

1.1 Who to Target with SMS Marketing?

Text messaging has been primarily used by enterprise businesses, as part of their collective marketing strategy run across different channels, including email, online chats, and live ads. The text service is also used by non-enterprise firms to boost their regular interaction with their clientele.
SMS marketing can be used to target an audience of any age group. Besides, malls, retail businesses, banks, restaurants, learning institutions, government offices, and even churches use SMS marketing to engage with their audience. Recent research on cell phones shows that 95% of Americans own cellphones. Of these, 81% actively use text service, and out of this percentage, 82% open all the texts they receive in a day. Additionally, 85% of elderly persons aged 65 and above also stay active on their cellphones and frequently use SMS more than they do email services.

1.2 Tracked and Untracked messages

The ultimate goal of SMS marketing is to create engagement with customers and using the channel as a marketing strategy for business growth. Businesses measure the success rate of their text service marketing campaigns by tracking the response that the message triggers; they use a text message provider to send tracked messages.

Unlike untracked messages, tracked ones have an element in them which allows analytics to monitor the engagement of the message. Textedly offers reliable SMS marketing analytics that both enterprise and non-enterprise businesses can utilize to measure the effectiveness of the done campaigns.

1.3 Experiences of Businesses with SMS Marketing

IKEA: furniture, home, and kitchen appliances company
Renowned multinational company IKEA uses SMS marketing to send updates to their customers on new products and exclusive offers. Clients who wish to opt-in send “JOIN” to the number provided by IKEA and those who want to opt-out send “STOP”.

CNN: media company
Global media company CNN utilizes SMS marketing to communicate news alerts to their audience. To get breaking news alerts, clients text “ALERTS” to the number provided and receive regular updates.

Facebook: social media company
Facebook utilizes text messaging as a part of its collaborative campaigns to help businesses create smart digital marketing strategies. When used in conjunction with online campaigns, Facebook users can engage their clients both online and offline.

Additionally, Facebook uses this technique to improve the security of its users through 2-factor authentication. When a client opts in, they receive a text message every time they log in from a different device.


#2 | How SMS Marketing Works Successfully

2.1 Set a Clear Campaign

Business owners, as well as marketing and communication managers, use text messaging to do the following:

  • To create awareness of a new product or service.
  • To send discount, rebates and freebie claims instructions.

  • To send renewal reminders for subscription-based services.

  • To poll customers about their preferences in exchange for incentives.

  • To create drip campaigns to engender customer loyalty and to encourage ongoing purchases.

  • To invite the public to local events.

  • To hold a contest. E.g., “Type WIN to 55555 to enter the weekly raffle.”

  • As a 2-factor authentication channel.


2.2 Set a Call to Action

The purpose of the campaign dictates what you wish your clients to do with the given information. This is also known as a call to action. For instance:

  • A text service informing the public of an upcoming event asks them to confirm attendance by sending “RSVP.”

  • A text service for 2-factor authentication cues users to click on the sent link or to key in a definite set of numbers or characters to successfully log in.

  • A text service reminding customers to pay for a utility bill cues the user to click on the sent link to authorize automatic renewal of that service.

  • A text service informing customers of an ongoing sale urges them to visit the shop before the sale ends.


2.3 Find the Right SMS Platform

The right SMS platform for your marketing strategy is one that allows you to do the following:

  • Choose an easy to remember short-code.

  • Send bulk messages to the contacts in your database.

  • Communicate back with your clients via SMS.

  • Automatically update the contacts database with users opting in and out.

  • Set auto-responses.

  • Seamlessly manage text messages on your desktop.

  • Run analytics on the effectiveness of your strategy.

Textedly offers the above features at affordable rates, with technical support from its able team of developers. Read more on how you can carry out your SMS marketing for business with Textedly.

#3 | Measuring the Effectiveness of SMS Marketing

The effectiveness of any SMS marketing campaign is determined by measuring its return on investment (ROI) or by using Google Analytics.


3.1 Measuring ROI

We use the following to measure return on investment for SMS marketing.

  • Click-through rate

    It measures the percentage of users who clicked on a link inserted in a message. The link prompts them to make a purchase or learn more about a service, a product, or an offer.

  • Opt-out rate

    This measures the percentage of subscribers who opt to leave the text service campaign. Customers choose to opt-out of a campaign if they no longer need your products or service, if they find the text messages are irrelevant or if they do not like the frequency at which the messages are sent. A high opt-out rate is a sign the SMS marketing strategy needs to be revised.

  • Conversion rate

    This rate measures the percentage of users who respond to the intended call to action. It could be a visit to an e-commerce site, a sign up on a website, a purchase, or a reply to the text or a phone call. Conversion rates are mostly used in purchase-related SMS marketing campaigns.

  • Growth rate

    This refers to the increase in the number of your subscribers. As the number grows, it is a clear sign of a successful SMS marketing campaign and an increase in your ROI.

  • Cost per redeeming subscriber

    The cost per redeeming subscriber refers to how much the business spends to create each lead against conversion rate. Therefore, it determines how profitable it is to finance the SMS campaign based on the level of conversion. If the costs outweigh the conversion, the campaign needs to be revisited.


3.2 Measuring the Results via Google Analytics

Google Analytics determines the success rate of SMS marketing for text services with a web link recognized by Google. It is quite easy to install and use on your website. To start using Google Analytics to determine the success of your text message marketing campaign, you need to build a link using Google link builder.
Google’s link builder considers the website URL, campaign source, campaign medium, campaign name, campaign term, and the campaign content, which you can learn to set up here. With the set parameters, Google tracks the SMS campaigns and generates reports based on its interaction. 

SMS marketing is a sure way of engaging with your clientele and increasing traction to your business. With a platform like Textedly, business owners can create effective text service marketing strategies for business growth with a promising return on investment. Get started with Textedly today and stay up to date with the latest unfolding in the field of SMS marketing. Embrace the power of SMS marketing with Textedly with our free-demo now!