We are all familiar with the concept of SMS. It’s an acronym that stands for Short Message Service and the first one was sent almost 28 years ago (it said “Merry Christmas” in case you were wondering). We now send 270,000 of them each second - that’s roughly 1.8 million since you started reading this article.
We also all know what marketing is, or at least we should do - it’s as old as language itself and we encounter between 6,000 to 10,000 examples of it every day.
SMS marketing (also known as text marketing), however, is less well understood. The vast majority of SMS messages we send and receive are social in nature - everyday conversations with our friends and family. The marketing ads we consume are predominantly delivered via the websites we visit and the social feeds we scroll down, not through an SMS channel.
In this article, we’ll cover the basics of SMS marketing, and explain why many eCommerce brands are using it to drive revenue, CX and retention.
What is SMS marketing?
SMS marketing is pretty much what it says on the tin - a method by which brands can communicate with their customers using text messages delivered to a mobile phone.
In practice it can take many forms. A basic SMS marketing strategy might involve a business offering promotional deals or new product drops via text in order to drive sales.
Some vendors might take this a step further, and use SMS as a channel to build community loyalty around their brand with the aim of improving customer experience and retention. They might do this by offering customers access to exclusive content, CX support or delivery updates via text.
In its most advanced form, SMS marketing ventures beyond traditional ‘marketing’, and becomes a channel that supports every aspect of the customer journey - from conversion and payment to fulfilment and reordering. This joined up customer experience delivered within one channel is something most eCommerce brands cannot currently offer.
But with 5 billion people (of which 75% are smartphone users) currently using text messages on a regular basis, the opportunity to drive revenue and retention is undoubtedly huge.
For more on the basics of SMS marketing, check out our guide on how to set up an SMS marketing campaign from scratch.
How is SMS marketing used in eCommerce?
SMS marketing is increasingly being used by eCommerce stores as another channel to reach their customers. Because these brands are often selling Direct-to-Consumer (DTC), and own an end-to-end relationship with their customer, SMS can be particularly powerful.
Let’s look at some of the ways in which SMS marketing is being used in eCommerce.
Campaigns & product drops
SMS is a great channel for letting customers know about new announcements. Got a discount offer or a new product to release? Dropping a text to your audience with a link to a purchasing checkout can really increase conversion and revenue. This can be particularly effective around Black Friday, the Holidays and during the summer sales, when consumers are looking to buy.
The more targeted you can be with these campaigns the better. In this example, Daring Foods celebrated National Fried Chicken Day with a free in-person offer for customers in LA county, USA.
Product fulfilment & delivery
ECommerce brands are also using SMS marketing to update customers on delivery information. Whilst this can also be done by email, receiving a text message can be a much more convenient experience for the user. Check out this example of a nice brand-customer interaction that took place following an SMS order confirmation:
Customer support & feedback
Delivering post-purchase customer service is a big challenge for eCommerce brands, and if done poorly, it can drive churn. Email can be a slow, clunky channel for customers to have to engage with for support, and no one wants to wait for over 24 hours for a response when they have a problem.
SMS is a channel that facilitates more immediate two-way chat between a brand and a buyer. CX issues can be solved quickly, and it also give you an opportunity to collect customer feedback.
Here’s how one brand uncovered some great product usage feedback and built a positive customer experience by following up with a post-order message:
For eCommerce brands selling low AOV, high frequency products, getting customers to repurchase again is key. Consumers carry phones in their pockets constantly, so SMS can be a super convenient way to reach them.
Stores that are able to send the right product as a reorder prompt to a customer at the right time, are likely to drive multiple purchases. Using historic Shopify data, SMS marketing platforms like Blueprint can even predict when a particular customer is likely to want a reorder, and send an automated text message prompting them to buy.
In this way, SMS marketing can drive strong retention for eCommerce brands.
The final SMS marketing use case for eCommerce is subscription management. Subscriptions models are popular with brands as they offer the chance of predictable revenue long-term. Subscriber churn, however, can be a big issue - driven by product overload and inflexible order management portals.
SMS can overcome this problem by giving customers the option to skip or edit, rather than cancel, their regular orders via text.
In the above example, the customer of a dog food brand was able to delay their next order by a month as they had too much product. This kind of flexibility offers a great user experience and reduces subscriber churn.
For a full breakdown of how SMS marketing is being used in eCommerce, including templates that you can download to get started yourself, check out our SMS Marketing Starter Pack.
What are the benefits of SMS marketing
SMS marketing holds several advantages which existing one-to-many digital marketing channels, such as online ads, email and even branded social media accounts cannot offer:
SMS is convenient
Mobile phones are almost completely ubiquitous. Pretty much everyone owns one and they keep it with them all the time - 33% of young people even take theirs to bed with them at night. On average we check the devices in our pockets 96 times a day, or once every 10 minutes. That makes SMS the most convenient way for brands to reach their customers, or vice versa.
SMS is fast
With convenience comes speed. A person checking their phone every 10 minutes is more likely to read and act upon an incoming message device. The average response time to an SMS is 90 seconds, whilst 95% of them get opened by the recipient. When compared to emails which are opened at a rate of 20.9% and replied to after 2.5 days on average, SMS is a lightning fast way of reaching buyers and compelling them to take action.
Text messages are cost effective
The barriers to entry for brands to leverage SMS marketing are low. The technology has been around for a long time and software platforms used to deliver and manage your messaging are relatively inexpensive compared to running Google or Facebook ads, for example. In the US it costs brands a fraction of a cent to send one message. European rates are slightly higher - up to 5 cents per message - although prices get cheaper the more messages you send.
SMS marketing requires consent
To receive SMS messages from a business, customers must specifically opt-in to the service. Being sent direct messages to your phone is a more personal interaction than other opt-in marketing tactics like bulk email newsletters. For that reason, customers are likely to be more discerning when choosing which brands to engage with via SMS. This means your text marketing list is likely to be highly concentrated, containing the customers who are most actively engaged with your brand and its values. SMS provides you with a powerful opportunity to engage with this important core group.
Text messages are conversational
SMS allows you to give your customers what they want - a one-to-one interaction with their favorite brands. Buying is no longer a one way transaction - 83% of users now contact businesses to find out more about their products or services before purchasing.
People want to be treated as individuals, and SMS, whether through chatbots, a customer service team or a mixture of both, is a hugely effective means of delivering that experience. And consumers are already on board - 79% of them are willing to use messaging apps to get customer service. It’s up to brands to meet buyers on their terms.
For insight into how your should word your text messages, dive into our guide to creating content for SMS marketing.
SMS is highly commercial
SMS marketing is about promoting your brand, nurturing an audience and providing adequate customer support. But you’re not doing it to be everybody’s best friend - ultimately you want to convert and retain. The best SMS strategies do this within the text-based channel itself, rather than adding friction by driving buyers to a cumbersome website requiring account log ins and card details before every purchase. Used in this way, SMS goes from being a marketing tactic to a direct revenue generator.
For more on this topic, take a look at our guide on how to build and monetize your SMS list.
SMS boosts your retention
Every eCommerce vendor grapples with reducing churn, and with good reason. On average 43% of profits generated by eCom stores come from retained customers, with the best vendors winning 80% of their business via repeat purchases. With that in mind, SMS can be a crucial pillar of your retention strategy. Post-purchase reorder prompts and follow up nurturing flows, which you know have a high chance of being read by a previous buyer who is interested enough to sign up to your SMS service, can be the difference between moving them onto second and third purchases or churning after one.
SMS marketing delivers great insights
Only 42% of companies are able to track CLV accurately. Having your customer’s historical buying data linked to a specific mobile phone number allows you to know exactly who is buying what from you, how often, and for how much. SMS offers you as a vendor a deeper insight into your customers buying habits, and assigns a clear ROI to text-based marketing efforts.
SMS marketing for eCommerce
SMS marketing has huge potential as a marketing and revenue generation strategy. It is based on a technology that is already heavily embedded in the lives of almost every one of us, and can offer the seamless, one-to-one experience that consumers are now demanding. Despite this, SMS adoption by most eCommerce brands is still in its infancy. Those that embrace it now are best placed to master its potential and reap the whole host of benefits SMS marketing offers.
For practical tips and examples from top brands on how to build an SMS list, check out our guide to collecting customer numbers.
Check out some great (and not so great) examples of how some early adopters have incorporated SMS into their marketing strategy here.
Blueprint is the SMS & WhatsApp platform powering CX and retention for eCommerce brands. To find out how to revolutionize your customer journey and keep buyers coming back for more, book a demo today.