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Is SMS marketing the direct contact ‘silver bullet’?
By Leon Gettler, Talking Business >>
SMS MARKETING is now the rage in business.
Speaking personally, I am constantly getting text messages from Kogan and The Australian giving me their latest offers.
Jonathan Walsh, the general manager Asia-Pacific for Esendex Australia, said SMS – short message service – can have a massive impact on customer relationships, provided it’s done properly. It should never be intrusive.
But when it works, he said, it’s much better than email.
“Email is the channel it gets most comparison to … and there’s a perception from people or businesses that haven’t (used) SMS for their marketing campaigns that email is free and SMS has a cost,” Mr Walsh told Talking Business. 
“Whilst there might be some realities to that, we know that 95% of SMS is opened versus about 22% of emails so there’s a cost benefit there knowing that almost 100% of every SMS you send is going to be seen by the people you’re trying to send to.
“And the other benefit of SMS is that 90% of SMS is opened in the first three minutes.”
This, he said, translated into a high conversion rate and Esendex has business customers right around the world.
“Email on average has a conversion rate of 3.2% across our customers whereas SMS is converting at about 32%,” Mr Walsh said.
“It’s unparalleled in its success when done properly.”
SMS avoids ‘junk mail’ filter
One of the problems with emails is that they often end up going into junk mail. People don’t respond to those emails. That doesn’t happen with SMS.
Esendex has Australian retail case studies showing the success of SMS marketing. One example cited is fashion retailer Black Pepper which secured 8.4 times more purchases when they used an SMS marketing campaign.
“We get told all the time that SMS has been the best performing channel,” Mr Walsh said.
“Let’s face it – SMS can be intrusive. We’ve all been hit by scams and unruly messages. That happens in email and other channels as well.”
He said successful companies like Black Pepper used SMS to give certain customers the VIP treatment.
“It’s to have a real relationship and conversation with customers, rather than just blasting them and saying ‘Here’s our sale!’,” he said.
“It’s to actually give important customers, or repeat customers, or VIP customers early access to periods like Black Friday or Cyber Monday.
“So before a sale becomes available to everybody, giving people access 24 hours earlier.
“SMS has been a really successful channel in getting that message across and making sure your VIP customers are being treated as such.
“Because it’s not going to get lost in the minutiae of email they’re receiving. They’re going to receive the SMS and they’re going to see it and that’s leading to those really high conversion rates we’re seeing.”
SMS requires permissions
The important part is that the SMS can’t go out blindly. You need permission to send SMS.
Under the Australian Communication and Media Authority spam code, you can’t just get mobile phone numbers and send out text messages. You need to get permission first.
It also means Australian e-commerce businesses and retailers need to know who their best customers are in order to adopt the SMS marketing strategy.
“The ability to send an SMS that’s going to cost a few cents to retain an existing customer is just about the most cost-effective way to get a sale,” Mr Walsh said.
Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at www.acast.com/talkingbusiness
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