SMS Marketing: Trend or Trouble

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Did you know that in the U.S. we send over 3.5 billion texts a day? I didn’t until a few months ago when I read, “Text-Message Marketing”. The article explains the rules on how to get started with SMS marketing. When I started the article I was completely against the whole idea. A few years ago I participated in a text message contest for “One Tree Hill.” We were allowed to pick which guy one of the characters could end up with. Who wouldn’t participate?!

After entering the contest I continued to receive weekly texts nagging me about some promotion. Needless to say, I loathe this form of marketing. However after reading this article and learning that 97% of people who receive SMS marketing messages open them I no longer disliked the idea. I could see it’s potential.

Since I was still on the fence, I turned to the very reliable PRBC Twitter community to start a discussion and gather their thoughts. Here’s what some of them said:

Heather Dueitt: I’ve done some successful campaigns though. mainly around txt to win and we aren’t spamming them afterwards. #prbc
Jason Keith: I’ll never be ok with text marketing, and I’ll never sign up for it. Feel like my phone is my own private sanctuary.
Lindsay: If I’m paying for a text, it had better be from a welcome source. Send me mktg e-mail, that’s what my cberry is for. #prbc
Vince Pickett: Mobile has to be part of marketing mix (DMA) #prbc

From Vince’s link we learn the top 3 categories of mobile offers: 1. Entertainment/Music/Video, 2. Food/Beverage and Telecommunications/Mobile and 3. Beauty/personal care. This doesnt surprise me, it reiterates the importance of knowing your target audience before implementing a SMS marketing campaign (or any campaign) and how to reach them. In my coffee talk with Mike Schaffer, he explained a great SMS marketing plan takes time and effort to succeed. He found that when implementing the plan, it was more difficult to inform the audience about it versus getting them to sign up.

When it’s all said and done, I believe SMS marketing can be essential for some, not all, marketing/PR campaigns. And it’s not just for the big guys like “American Idol”, Dunkin Donuts, or McDonald’s; small companies can benefit too.  I think we haven’t seen more companies taking advantage of this form of marketing because the laws surrounding it are vague.  Also companies need to make sure their consumers don’t feel they are being spammed or taken advantage of.

Overall, in order for SMS marketing to be successful, you have to earn the trust of the consumer. Remember the beginning of e-mail marketing? I hated giving my e-mail to retailers and now I do it at the drop of a hat to the places I trust. Sure I may delete 70% of those e-mails but if I really don’t want them I can unsubscribe with a simple click.

It’s simple: gain the trust by building the relationship. Like the Times article says, offer the consumer something valuable, an exclusive VIP pass, or privileged information. Make them feel they are on the “inside.” Ask for their opinion. Isn’t the customer always right? Also opting out should be just as easy as signing up. Don’t make the consumer do the extra leg work to quit when it only took a few seconds to start.

So I’m curious to hear what you have to say. Have you participated in a text message contest? What were your likes or dislikes? Have you implemented an SMS marketing campaign? What would you add as pros or cons to this relatively untapped form of marketing?

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  • http://twitter.com/brenleigh Brenda Drake

    I will admit to participating in a few radio station SMS contests. I can't say as I've seen or heard about any other company using them. I believe the radio stations use it because it's the next step from telephone calls – the stations here use it for contests, to submit song requests or even to comment on what the DJs are saying. I have yet to be spammed after the fact – just one reply message thanking me for the text.

    I think you hit the nail on the head when you say one con to using an SMS campaign is the lack of regulation in the area – and probably lack of research in how consumers currently utilize SMS. When is SMS more effective than email, twitter and/or facebook? I think it's an extension of former telephone campaigns…but I am not looking forward to the day I get a text asking me who I am voting for in the next election. :-/

    Thanks for the great thoughts!

  • kmskala

    SMS is very interesting strategy. I have a friend that owns a mobile marketing company and have talked in great lengths about SMS, and from my conversations, it's not about the industry; it's about the execution.

    Whether you use it for marketing & promotions, advertising or customer service, it's an avenue you need to at least look into. I don't necessarily feel you need to have an already established relationship. Sure it helps, but for a lot of campaigns, SMS helps move and strengthen the relationship and turn it into a lasting relationship. The key, however, goes back to execution. You need to use it to add value (like everything else) and I think a lot of companies use it to push useless spam.

    If done properly, it can and has worked for bars, restaurants, schools, sports teams…but again, they all had a useful and effective strategy. People want to feel like they belong, they like the feeling of assuming they're important. SMS brings that “you're part of the important crowd”.

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  • http://twitter.com/stina6001 Christina K

    Thanks for adding these great points Kasey.

    And you're right – it heavily relies on execution. You explain exactly what the article said, everyone likes to be part of the “important” crowd. I see SMS as long as companies know how to not cross that spam line.

    How do you think a smaller company, less established would be able to use SMS to help create a lasting relationship?

  • http://twitter.com/stina6001 Christina K

    Good point about radio stations using it. When I used to drive for work, I would often here promotions for contest/feedback for listeners to text in.

    It's an interesting, fast, and accessible way for them to garner feedback and see who's actually paying attention. Easier than calling a million times to win a contest too.

    I think SMS marketing can be way more effective than e-mail but I'm not so sure about Twitter. I rarely become a fan on FB (so I'd be out of that category). I think FB is still too personal of a social medium.

  • http://twitter.com/JamesonBull Jamie Bull

    Definitely trouble. I think a big distinction needs to be made in that 97% opening stat. Just because you open it, doesn't mean you wanted to get the message inside. It is probably just dumb curiosity. “WTH is this number, what are they sending me NOW?”

    With all of the other ways to market to me through my phone, (Facebook, email, twitter…) SMS is the last place I want to get marketing info.

    Sure, not everyone has fully web-enabled phones, but eventually everyone (or enough to matter) will. I think broader integration of web marketing and mobile marketing will peak far before SMS marketing really has a chance to prove its value, and ultimately die.

  • http://twitter.com/stina6001 Christina K

    Hey Jamie,

    Thanks for adding to the discussion here :)

    I believe most of the people who open those messages have signed up for them. That's why I referred to when I receive and e-mail from some retailer. I rarely ever open those, just click delete and move along. But that's probably because I get so many of them.

    For instance, I know my friends receives texts regarding Sports stats, but he wants them, so of course he'll open them.

    IMO, I think it's the companies that are going about SMS marketing all wrong that ruin it for the good guys. The ones that just spam you without your permission – the minute that happens is the minute I no longer care about your company.

  • kmskala

    I almost look at it like a newsletter type approach. I'm working with a local beauty salon, so I'll use this business as an example. Why not send customers reminders when new products are launched, slow business one day – send a text that you get X% off if you book new appointment by end of day, send quarterly beauty tips.

    Like I mentioned above (and you reaffirmed), it has to be strategic. Sending weekly texts may work for one company, but it may not work for another. As long as you comply with the opt-out regulation and you're smart about it, I think it's a great tool.

  • kmskala

    Jamie,

    Bars and restaurants are probably the two most used SMS marketing venues. Lets say you had a favorite restaurant in town and they offered to periodically send you coupons via text? What if a bar you frequented sent a text reminding you of an upcoming event or special?

    SMS marketing is sort of like social media – it's an added layer of trying to win customer support and value. You can use Facebook, e-newsletters, etc…but why not sprinkle SMS?

  • mikeschaffer

    I'm REALLY glad you developed this into a fantastic post!

    SMS marketing is perfect for staying connected with an existing audience – or creating one with a major marketing/advertising push.

    It will not – I repeat – will not – lead to many, if any, first-time customers. However, it can be a major player in building strong brand loyalty.

    Trust, as you said, is the key factor. If you are giving your phone number to a company, you need to have some level of comfort that they won't abuse it.

    Personally, I participate in only one SMS program, a Baltimore sports news service from WNST-AM. They have content I want and don't abuse their list with spam or over-messaging.

  • http://sazbean.com sazbean

    Thanks for the article Christina! I think mobile and SMS marketing is going to be an important part of the marketing mix (especially in 2010!). As with any marketing campaign, marketers need to be responsible and provide good information and content to the recipients. It's very easy for disgruntled customers to tell everyone if you do it improperly.

    I think both mobile and SMS marketing can be very valuable to the consumer if they're done properly – mostly by providing something useful and timely. My husband was at a local coney island yesterday which gave a 10% discount if you cut out an ad in the paper – which they then handed back to you so you could use it again. Wouldn't it be much more convenient if the coupon was on your mobile device instead? Or what if you're in a certain area for lunch and your favorite restaurant offers you a special discount that day only? Would you go?

    People do seem interested in receiving offers that are targeted to them, so we'll have to see how things pan out with mobile and SMS.

  • http://twitter.com/stina6001 Christina K

    Oh Mike, always a little controversial ;) I kid, I kid.

    My only question would be why? Why do you say that it will not lead to many, if any, first-time customers? Is it again the trust factor?

  • http://twitter.com/stina6001 Christina K

    Thanks for that great example.

    When I worked in retail, many customers would show me their phone with the e-mail that they had to print out to receive the discount. At the time, I thought these people were crazy until I no longer worked at the store and actually did the same thing. If I had a text from the retailer, it would make shopping and maybe saving some money a little easier which in the end would make me go back to them.

  • mikeschaffer

    The answer boils down to informing people about the SMS campaign. People that are likely to even pay attention to your campaign are more often than not existing users. I don't see it as a trust issues as much as a one-has-to-come-before-the-other issue.

    If Store X that you knew nothing about ran a campaign, you probably wouldn't care much. You have no relationship with that brand.

    On the flip side, if your favorite retailer asked you to sign up for their SMS newsletter, you'd be more likely to do just that. Your existing relationship with the brand just got tighter.

  • http://twitter.com/vbpickett Vince Pickett

    Thanks again for the quote Christina.

    With mobile best practices stating that this should be an opt-in medium the call to action is highly targeted to people with an active interest in your brand or offer. For the rogues who will create spam in this arena just as they have everywhere else, legislation like New Jersey is working on (http://www.mobilemarketer.com/cms/news/legal-pr…) will hopefully be expanded across all of the states sooner than as an afterthought later.

    As for limitations on what businesses can utilize mobile in their mix, there is a wider use already than what might come to mind from American Idol and the local radio station. Here are a few examples and case studies for a variety of business: http://www.starwoodhotels.com/whotels/support/f…, http://www.mobilemarketer.com/cms/resources/cas…, http://iloopmobile.com/blog/?cat=3, http://www.mobilemarketer.com/cms/resources/cas…, http://www.mobilemarketer.com/cms/news/messagin…, http://www.mobilemarketer.com/cms/news/messagin…, http://www.mobilemarketer.com/cms/news/messagin…, http://www.mobilemarketer.com/cms/news/messagin…, http://www.mobilemarketer.com/cms/news/messagin…, http://www.mobilemarketer.com/cms/news/messagin….

    By tagging a mobile call to action in your other marketing promotions you are handing your target audience the key to step right in and begin interacting with you. As long as your message stays relevant and you provide a clear method to opt-out you will have direct access to the consumers who want to hear your message.

    • Anonymous

      No problem Vince and thanks again for adding to the discussion with the case studies!

  • http://twitter.com/stina6001 Christina K

    No problem Vince and thanks again for adding to the discussion with the case studies

  • http://www.mogreet.com/ Jay

    As PR professionals, perhaps the most valuable thing to know about text messaging is that it DOESN'T have to be text-only (a bummer, when 160 characters doesn't suffice). You can send short format video. See this in action – text 'mogreet' to 21534. Combining the expressiveness of video with the ubiquity of text messaging is pretty powerful. Layer on the fact that 95% of all text messages are read within 4 minutes and you have a dream medium.

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  • Jean

    Have you ever heard of someone requesting text messages that are supposed to come once a day at a certain time from a company – and then they don't come for a week or more and then ALL OF THEM come AT THE SAME TIME? Why would that happen? The company swears that all text messages left their system at the appropriate time. WTH?

  • AW

    Think you really need to put together a well-strategized plan and figure out the best ways to make an impact, without coming off as spamming people – whether they are a targeted customer or not.

    PR at Sunrise Blog – http://www.worob.com

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  • RobertSanchezGTM

    You hit the nail on the head when you spoke about trust in your post. Building consumer relationships is key to developing effective SMS-based marketing campaigns. At Globaltel Media, our customers have enjoyed great success in launching customized, two-way SMS-based marketing campaigns with dedicated short codes. Utilizing the real-time response rate tracking of our solutions, customers have been able to better tailor their respective campaigns to drive increased results and build customer relationships. It is imperative companies adhere to the MMA's opt-in/opt-out regulations, as sending out SPAM texts will only alienate potential customers. Thanks for the post!

  • http://www.mozeo.com Owenmunger

    I agree that it can be annoying to constantly receive SMS Marketing texts on your phone. It could really turn off a potential customer if they are fed up with hearing about your company. The most effective mobile SMS marketing strategies are one in which, you said it perfectly, you build trust.

  • Adamichel

    I think people don’t fully understand the underlying power of SMS marketing. Simply put, a business sends its deals ONLY to people that have requested to receive them by texting some keyword to a short code. THERE IS NO SPAMMING!!!

    Having said that, the issue of trust is certainly critical. If one signs up to receive offers from a local restaurant, they certainly don’t want to be bombarded by daily texts that deliver middling to poor deals. To build trust, a business should, in most cases, restrict their sending to no more than twice a week, and the sent deals should be such as strongly draw people in. Typical response rates from text marketing are in the 20%-30% range, with some results as high as 70%. I challenge anyone to present a marketing channel that delivers similar response rates.