SMS Marketing (text messaging), the Deepest Penetration for the Mobile Segment

Posted in: Marketing, Mobile Optimization

Graph that 99 percent of SMS text messages are read

When talking with clients, especially those who run a brick and mortar operation, one of the most important forms of targeted advertising is mobile. Why mobile? Well we use mobile when we are on the go, when we are in vicinity, and we can use it to opt-in from practically anywhere. That said, there is pretty much unanimous agreement on the importance. Now some of the younger generation (18-25) seem to think mobile is email, Facebook, Twitter, and well, it is but there is something to bear in mind. While a recent Nielsen report shows that 46% of mobile users have smartphones, there is also a study out by mobileSQUARED that shows that less than 40% of all email solicitations are opened. Now falling back on our high school math, we can see that 40% of a potential customer base, of 46% of the whole, gives us a 18.4% penetration. Not that bad when you consider the low cost of email advertising. But is it the best? Well considering that there is a lower cost to social media, then probably not, but one thing to bear in mind when it comes to the social side is that people do not rely on reviews of their social circles as heavily as one might think. In a Lightspeed survey, only 7% of shoppers utilized a social review when making a shopping decision. So while the medium is ultra low cost, the benefits gained as far as references might go is not ideal. Mind you, this does not mean that there is not a call for a social aspect to a campaign. It just is not as great of a conversion generator as many have come to think of it as. You can review our post on mobile shopping where we break down how and when people utilized mobile devices for shopping for more information. Then there is RSS. It is practically free and a great way to connect with users. Unfortunately, there are many less tech-savvy people out there with smartphones than tech savvy and when we consider that there is a 54% chance that a user would not be able to receive a RSS feed on their phone in the first place this removes this horse from the race of deepest penetration.

 

Need some Professional Internet & Marketing Consulting? We are here to help!

Contact Us

Using a consultant will save you time, money and will create a stronger project that meets the needs of your company.

General Contact Form

  • Connect with customers who do not use smartphones
  • Generate sales and leads via mobile coupons
  • Acquire new customers through customer evangelists
  • Connect with current customers in a more relevant manner

 

So where does that leave us? Well there is the old fashioned SMS text message. With a 160 characters of data limit and over a 102% penetration in mobile wireless in the United States.* What’s more, 90% of text messages are read within the first 3 minutes of delivery. Furthermore, 99% of text messages are eventually read by the recipient.** Now that we have found the channel with the deepest penetration and read rate, it’s time to look at some of its negative aspects. First is cost. When compared to other marketing channels, such as email and social, it has a higher cost of implementation. There is the cost of short codes, without which a SMS campaign is almost certainly doomed to fail, the cost per message, and then there is campaign setup and list maintenance (much like a email campaign: Read our Email Marketing the Right Way for more information on this). When people opt-in to allow you to communicate with them, on a medium that they almost consistently pay attention to, we as marketers need to take advantage. Ashley Furniture HomeStore held a Four-Day Secret Sale that was only promoted through their SMS and email marketing channels. At the end of the event, after subtracting the discounts from the coupons, the Ashley HomeStore SMS marketing channel generated a $122 return on investment for every dollar spent, while email only generated a $79 return on investment.*** Does this mean you should drop all your other mobile advertising channels besides SMS? Absolutely not. Email, Social Networking and Interest, and RSS are all great cost-effective channels. The issue is that not all channels are created equal within all customer segments. Just because we, as a user, prefer one over the other does not mean everyone will. A multichannel approach is what is best, but when setting up a campaign, do not forget about the old guy in the room, namely SMS. It is old, trusty, and relevant. *CTIA Wireless Quick Facts, June 2011: Determined by number of active units divided by the total U.S. and territorial population (Puerto Rico, Guam, U.S. Virgin Islands) **Neustar: Reaching the widest audience with common short code and SMS Mobile Marketing. ***mobileStorm: Ashley Furniture HomeStores Generates More Than $138K In Four Days by Using mobileStorm