Few people can resist opening a text message for more than a few minutes.
Emails can go unopened, leaflets go straight to the recycling bin, and telephone sales people get hung up on. But people can’t resist a text message.
But 97 per cent of SMSs, or phone text messages, get opened. Most are opened within four minutes of receipt, with 83 per cent opened within the hour, according to research by US technology and strategy consultants Chetan Sharma.
It’s a trend that businesses - including gyms, beauty salons, clothing stores, cafes and dance schools - are increasingly tapping into to try to drive better results for their marketing efforts.
“It really blows every other medium away in terms of response rates and open rates,” says Lauri Lassila, director of digital marketing agency of SL Interative. “It’s such a personal and direct medium and at the same time it’s very fast and immediate, so that’s why you’re getting a good response.”
SMS marketing can be used by retailers to make special offers and by other businesses to remind customers to book appointments. Response rates to SMS marketing messages are typically in the double digits, says Lassila, although this can be as high as 30 per cent depending on the offer.
Lassila says if companies don’t already have a database of customers’ mobile numbers they can do something like hold a competition and ask customers to text them to win or get a special offer. “That’s using inbound SMS to either update your database or create a completely new database,” he says. This is also important because according to rules set down by the Australian Communications and Media Authority (ACMA), markers need the consent of mobile phone users before they can send SMS messages to them.
Lassila says text marketing only works if a business’ database is up to date and it’s sending out genuine offers that customers would want. “It can go horribly wrong if you try and abuse your customer contact with something that they have no interest in receiving,” he says.
SL interactive advises businesses to step back and consider what value an offer has before they send it to customers. “If you’re second guessing whether the offer’s really that good, then we recommend not to send it,” says Lassila.
SMS marketing is often done through a third-party, which can provide technical and marketing expertise in sending out text messages to large groups of people. SL Interactive charges between 4.9 cents and 7.9 cents per message, depending on the volume.
However, a recent entrant to the market is offering free SMS messaging. Slexicon, a Sydney-based internet start-up, gives retailers and other businesses stickers to post around their business inviting customers to ring a number and register to receive SMS offers from the business.
Co-founder Vito Grigorov says Slexicon doesn’t need to charge for sending out SMSs because it buys data capacity in bulk and so the cost of messages is “minuscule”. Once Slexicon is more established, Grigorov plans to add extra features, such as analytics of customers and their response, and charge users for them.
Grigorov says that SMS marketing is not just for making offers or special deals to customers, but also as a way of connecting and communicating with them.
“The loyalty element and the ability to get the customer back in the store can only come from actual communication,” he says. “It can be about offers but it doesn’t always have to be. It can be updates about product lines or services.”
Slexicon also advises businesses to add a line to their text marketing message encouraging recipients to pass it on to their friends who might like to receive the same offer. “It has a viral element in that people forward the offer to friends, who are potential new customers,” he says.
One of Slexicon’s clients is Sydney clothing store Surry Zoo, which Grigorov says sharply increased its sales through the use of SMS special offers, such as $10 off all purchases ending on Friday. “That type of message brings in a lot of people,” he says.