By David Greenberg, CMO, Act-On
SMS is a very powerful channel to deliver better experiences and improve customer lifetime values, but many marketers have yet to explore its full potential. SMS can often be overlooked by brands who can be wary of reaching customers on their most personal devices.
However, 90% of consumers prefer SMS to a phone call and 75% want to receive special offers on their phone, according to SMS Comparison figures. That is why average SMS click-through rates are riding high at 19%, compared to just 4% for email.
This customer expectation, that brands will build a rapport and keep a conversation going over text, means automated SMS should be a central part of any marketer’s strategy to nurture and retain customers, so long as it is permission-based and used wisely.
This customer expectation, that a brand will keep a conversation going via text, is a golden opportunity for marketers to deliver on their wider strategy of improving the lifetime value of customers by offering better experiences. This is a real sweet spot for automated SMS which improves both brand and product engagement.
The customer expectation is already there, they just need more marketers to catch up as policy is such a crucial element of brand experience in today’s world. For customers who have opted in to receive text messages, a brand can use its marketing automation platform to deliver useful information. Strategies have to focus on what the customer will want to know, such as event details, purchase confirmations, delivery updates and loyalty point balances, to name just a few. The smartphone is the perfect place for these messages to land because, unlike email, people are permanently on their mobile phones, meaning the average text message is read and responded to within just three minutes.
Automated campaigns can deliver these updates where and whenever they are needed at low cost but they must be set up with a fanatical focus on helping customers as part of a company’s strategy to engage, nurture and retain. Get it right and analytics suggest SMS open rates can exceed 95% and click-through rates will reach as high as 40%.
So, what are the might high-value use cases to start with automated SMS? Typically, these include:
- Confirmation of purchase and payment is taken, followed by delivery updates
- Links to further information about getting the most from a product or service
- Feedback surveys
- Promotions, flash sales and coupons personalised to each customer’s purchase history
- Notifications and reminders of events – such as a product demonstration or check-in time
- Reminders – when does my parking run out, when do those theatre tickets go on sale
- Time-saving tips, confirmation of meeting locations with directions
Ensuring you deliver value through SMS outreach
The elephant in the room with SMS is that some customers may have had a bad experience in the past through spam texting, which makes it critical for marketers to guard their brand by ensuring campaigns are opt-in driven. However, the evidence now points to consumers both accepting and expecting responsible text messaging from reputable businesses. It is the approach that matters here and so the guiding philosophy should always be respect – only message customers when you are delivering value and always ask for permission first.
This is why automated SMS must never be seen in isolation, but rather as a highly effective tool deployed by teams seeking growth opportunities across multiple channels.
To avoid running the risk of frustrating customers, here are some simple best practice tips to bear in mind:
- Secure fully informed consent (it’s both best practice and a legal requirement) – opting for a platform that has best practice built-in to how it operates can simplify this process
- Openly share confirmation of SMS enrolment, data policies and opt-out options
- Never schedule B2B messages out of office hours
- Set customer actions that are best supported by SMS
- Pre-set frequency caps to avoid frustrating customers – the use of tools can support this
- Keep volumes and frequency low to start, then build up gradually
Experiment to drive growth
As with any growth marketing tactic, teams should feel free to experiment with messaging and the timing of communications, as well as frequency caps, to get a better hook on what works best. Using A/B testing is a good idea here, as is paying close attention to analytics provided by your automated SMS supplier. Figures for response rates and opt-outs are key numbers to watch early on in your SME journey.
As marketers engage more and more with automated SMS outreach, it must be kept front of mind that they are reaching out to consumers on their most personal device. Respect for privacy and transparency are fundamental requirements that should lead all marketers to only reach out to customers when they are truly delivering value.
Get it right, and marketers will find SMS is a central part of their automated marketing strategy because, as long as it is run on an opt-in basis, it allows them to build personal relationships with customers or potential customers. By ensuring an SMS is truly helpful and provides consumers with the content or information they want, marketers can maintain a two-way conversation that delivers on the wider strategy of delivering higher lifetime value for customers.