Nothing tells you the holidays are near quite like a noisy inbox. “Preview our early Black Friday deals!” “BOGO deals start NOW!” “Get $5 off this Thanksgiving!” And the list goes on.
So it's probably no surprise that email open rates are at their lowest during the holidays—18.6% according to Campaign Monitor—and as more businesses move online, analysts expect inboxes to be saturated in the near future.
As the owner of Bushbalm (and a Shopify employee by day), I’ve been more successful cutting through this noise with SMS marketing. SMS marketing gets high engagement—even higher conversion rates—and is more cost-efficient overall. Best of all, it’s more personal than many other marketing channels and fosters stronger customer relationships in the process.
In this blog post, we’ll run through the basics of SMS marketing, as well as some best practices and examples.
How SMS marketing works
SMS marketing, or short message service marketing, is the practice of sending marketing messages to prospective and current customers via text. The goal of SMS marketing, like email marketing, is usually to sell, educate, or build loyalty.
Strategically, email and SMS marketing are similar. Like email, SMS is an “owned” marketing channel—that is, the sender fully controls the list of numbers and distribution—and businesses can send 1-to-1 or 1-to-many messages, depending on their goals. Messages can be sent as one-off campaigns, like a flash sale, or automated as part of a drip campaign, like a welcome series.
SMS marketing requires a short code, the SMS equivalent of a company email address. A short code is simply an abbreviated phone number of five or six digits; they’re "short" so they’re easy to remember.
To opt into receiving your SMS messages, buyers text a keyword (like: HOTSAUCE) to this short code. Subscribing to SMS messages is a deliberate act, and rarely leads to bogus numbers.
Why invest in SMS marketing
1. High engagement rates
According to Gartner, SMS open rates can be as high as 98%, compared to 20% for email. More importantly, SMS click-through rates can reach 45%, which may shock email marketers who are used to the 6% average.
At Bushbalm, we’ve been using SMS marketing for over a year now and have some interesting comparison data. With our automated “welcome series” of messages, we see click-through rates of over 50%. Not open rates, click-through rates. In comparison, we typically see 25% open rates with our marketing emails and only 2% click-through rates.
Deliverability issues are virtually non-existent. Since SMS marketing requires customers to opt in, your list will only include customers who want to hear from you.
Since SMS marketing requires customers to opt in, your list will only include customers who want to hear from you.
2. Easy to write
Anyone who’s ever written a mass email to customers knows the painstaking efforts required to craft the perfect subject line to get that open rate, and the perfect copy that gets people clicking through. With SMS, you’re writing a couple lines. And forget about design—a little emoji or GIF action is all you need to make your message pop.
3. Strengthen customer relationships
Above all, I’ve found that SMS helps us build more personal, loyal relationships with our customers. Texts are inherently easier to respond to, encouraging actual 1:1 dialogue. The average response rate for SMS is 45%, compared to email at 6%.
Our team has set up SMS to not only send mass messages, but to engage with customers directly in a success and support capacity.
Challenges with SMS Marketing
1. Potentially higher upfront costs
For most people, the value of their phone number is higher than of their email address. As a result, sometimes you need to provide a greater incentive to capture a new number.
In one signup campaign, we initially tried gathering numbers without offering anything, but once we offered a 20% discount, we saw hundreds of sign-ups daily. Phone numbers are “expensive,” so make sure there’s enough incentive.
What’s more, depending on the software you choose the cost of sending an SMS message will also vary slightly. SMS can range from $0.50-$1.75, compared to email which costs roughly $0.15-0.35. But in my experience, the return on investment is higher. Our business sees roughly $1.3 earnings per message (EPM) for our automated flows and roughly $.50 EPM for our campaigns. For example, if we generate 1,000 new month signups and send them 1 SMS each we’d see roughly $1,300 back in revenue, minus the $10 cost to send 1,000 messages.
2. Relatively small subscriber lists
SMS marketing is often seen as ineffective because of low subscription numbers and high unsubscribe rates, compared to email. It's true that you typically get fewer subscribers and possibly more opt-outs, but those that stay on your list are incredibly engaged. In fact, according to one study 77% of consumers think positively about companies offering text as a communication channel. The key is being thoughtful about how often you send messages and making sure your content is relevant (but more on that, below).
Many online marketers avoid SMS marketing because they assume the legalities are too complex, but that’s not true at all. The biggest thing you need to know is that SMS marketing is a permission-based channel, which means you need your buyers’ consent to send them promotional text messages. These opt-in messages must be fully compliant to the Telephone Consumer Protection Act (TCPA), which protects consumers from unregulated use of their personal information. If you use a Shopify app to send SMS marketing messages—see our favorites below—you can rest assured it’s already TCPA compliant.
Getting started with SMS marketing
Before you start an SMS marketing campaign, you need to build a list of phone numbers with opt-in consent to send promotional messages. Typically you’d gather these from prospects and customers, so if you aren’t already generating traffic to your site, SMS might not be for you just yet. I’d recommend spending weeks or months building up your SMS list first.
Here’s an example of how The Children’s Palace builds a massive SMS subscriber list:
SMS marketing works great during peak shopping seasons when email spam is high, paid advertising is expensive, and consumer attention is low. SMS, on the other hand, is not a saturated channel yet, so it still effectively cuts through the noise.
For Shopify store owners, getting started with SMS marketing is as easy as downloading an app, which all have built-in compliance. You’ll find lots in our App Store, but I want to highlight four I’ve personally tried:
- Postscript. In my opinion, the best integration for Shopify stores. Easy to use and integrate. This is what I use.
- SMS Bump. Another great SMS marketing app used by lots of Shopify and Shopify Plus customers.
- Attentive Mobile. Ideal for bigger brands with hundreds of thousands of subscribers. Counts Sephora, Coach, and Williams-Sonoma as customers.
- ManyChat. Great for international campaigns.
SMS marketing best practices
Make it easy to opt out
More than any other channel, SMS marketing requires buyer trust. You do this by making it easy for customers to opt in and opt out of your SMS list. Yes, you’ll likely lose some subscribers, but those that remain on your list are there because they really want to see your message, not because it’s hard to unsubscribe. Another way you can put your customer in control is having them text your business first to join. Postscript in particular has a nice feature where your customers text you to confirm their subscription.
Seek to inform, rarely to promote
Since it’s easy to opt out of promotional SMS messages, you want to be incredibly considerate of your buyers’ inboxes. As a rule of thumb, most of your messages should be related to an order, from status to asking for feedback. These are always useful. Promotional messages should be few and far between, no more than once a week in my opinion.
Make it conversational (sometimes)
The beauty of SMS is that it's inherently conversational in nature. SMS is all about back and forth dialogue, and marketing through SMS is no different. This makes SMS a great way to generate reviews and product feedback directly from your customers. In our business, we'll send a text asking for their opinion on future product lines. This type of engagement is what leads them to get excited by your text messages. SMS can be a push channel as well as a strong pull channel.
Four SMS marketing messages to try today
Now that we’ve covered the principles of SMS marketing, I’ll show you how I’ve applied them at Bushbalm:
1. The Flash Sale message
Who wouldn’t want to receive these from your favorite brands? A short and snappy SMS is a great way to promote one-off flash sales or major promotions.
2. The Hype-Up text
Don’t launch a flash sale without some hype. A text a few days earlier makes a big difference in conversion. Many people like to think about their purchases ahead of time, so it's wise to give your favorite customers a heads up before your sale is live.
3. The Feedback message
Thanks to its conversational nature, SMS is great for striking engaging conversations with your customers. For example, when we come up with new product ideas, we might send an SMS to our customers, asking for their opinion. If they reply, we’ll have engaging 1:1 discussions. Not only does this bring our customers in to our process, but they’re far more likely to buy the product when it’s out.
4. The Back-in-Stock message
This message informs customers about sold out inventory. It’s a gentle yet effective way to re-engage past visitors. Combine with a free shipping minimum or other tactics to increase your average order value. Transactional messages are impactful and simple to automate.
What's old is new again
Many online marketers steer away from SMS marketing because they assume it’s expensive and intrusive. Not so. If you apply the principles above, you’ll cut through the noise, increase your conversion rates, and build positive, loyal customer relationships in the process. Happy selling!
Illustration by Pete Ryan