The message above pops up on my phone. Clicking on the link takes me to a coupon I can use exclusively in-store, no more waiting for crumpled circulars in the mail.
This is an example of a text message or short messaging service (SMS). It is one example from a company that sends millions of text messages, multiple times per week, according to Lee Washington, Manager, CRM & Loyalty Strategy for JOANN.
So why would companies like JOANN want to contact you via text message, multiple times a week? And who are the people who wish to receive these text messages from businesses?
One reason companies employ text messaging into their marketing plans is because of the conversion rate. As Washington explained via email, “SMS campaigns generate the highest conversion rates. This was surprising given the success we have seen in our other marketing channels prior to JOANN launching an SMS program.”
Jamie Fingal of Orange, California, signed up to receive text messages from JOANN because of their coupons. Beth Baldwin of Annandale, Virginia, said the same. “I feel like JOANN’s does a good job at reminding me they have something I need and they’re not garish. They get in; they deliver, they get out,” Baldwin said via email. Fingal also likes receiving texts from JOANN as well as select other companies, explaining via email, “I like them because I can look at them anytime, or not. I can choose. I don’t have to answer the phone and interrupt my day and play the number game on my phone before you talk to a real person,” she said.
Text Messaging is Powerful
Text messaging has an incredible open rate of 98 percent. When compared to email’s average open rate of approximately 20 percent, according to MailChimp, there is no competition.
Other statistics regarding text message usage are equally as strong. In fact, 90 percent of text messages from businesses are read within the first three minutes of being sent, Forbes reported. And 89 percent of people have said they want to text with a company, according to Twilio, a cloud communications platform.
And there’s more: text messaging is the number one reported use of smartphones, from MarketingCharts. Americans spend as much as 55 minutes a day texting according to Text Request, sending approximately 26 billion texts per day, according to Statistic Brain. And text messaging is the number one business communication channel of people 24 to 39 years old, according to Twilio.
It’s no wonder companies such as JOANN have figured out a way to use this marketing channel in very successful ways.
Text Messaging as Marketing
There are several different ways to incorporate text messaging into your marketing mix. Think of it just like an email list, but via text.
First, like any marketing, you need to define your goals. The good news is you can use text messaging in various ways to achieve those goals. Have an event coming up? Want to increase your email subscribers? Want to raise brand awareness? Want to increase sales? You can use text messaging to help you achieve these goals and more.
Shannon Okey, the organizer of Cleveland Bazaar, Northeast Ohio’s longest-running indie handmade craft fair, uses text messaging to help grow the Cleveland Bazaar email list with a service called Join By Text. This service lets users text to join their email list.
Cleveland Bazaar has utilized an email marketing list since the inception of the market. Okey explained via phone how they’ve started incorporating text messaging into their email list growth strategy.
“We added Join By Text because people are transitioning off of email and we wanted to see if it would be a good way to get more people on board who might not fill out a traditional form,” she said.
Okey has seen many benefits from using the Join by Text service. Okey said her customers have found texting to join the Cleveland Bazaar email list to be novel, as well as being quick and easy. On the administrative side of things, she said it was also simple to explain, and the interaction was positive because it was succinct. “It’s very easy to include in marketing materials. So for postcards or show posters, it’s extremely easy to put ‘text this number to join our mailing list’ as opposed to – ‘go to our website and sign up to our mailing list,’” she said. “There’s brevity to it that I find valuable for marketing materials.”
Cleveland Bazaar has been using the text-to-join method for about a year. They haven’t seen explosive growth due to this different approach, but they have seen growth. “It’s people we didn’t have before,” Okey explained. “For me,” she said, “that is a win, and the chances are good that they’re also local people because they’ve seen it somewhere on a postcard or a poster.”
Okey did acknowledge a downside to using the text-to-join method. “The expense,” she said. At $19 a month, it’s not a significant outlay but as Okey went on to explain, “We have a lot of things competing for the amount of money we have for advertising purposes.”
Text to Sales
Another way to use text message marketing is to drive traffic to your e-commerce site to increase sales. Bean Goods is one such company that has started to delve into using text message marketing for this purpose.
Bean Goods is a niche brand for people who love dachshunds and want dachshund-themed clothing and accessories. This e-commerce site was launched in 2011 by husband and wife team Claire and Chris Wolfson. After revamping their e-commerce site and moving it to Shopify in 2018, Wolfson became intrigued by text message marketing. “I had been hearing a little bit of buzz here and there from various Facebook groups and blogs and social media and all the podcasts and all the things where I try to continue my learning. I was super interested in it,” she explained.
After learning about a company called Postscript, Wolfson attended an info session at Shopify in LA to learn more about the company and what they could do. She was so impressed that they signed up on the spot. Postscript is a software that works with Shopify to run your text message marketing.
Bean Goods has only been using text message marketing for about seven months as of publication, and they’ve seen a significant increase to their SMS list. Their conversion rates to sales from SMS are higher than email, and they have a lower opt-out rate when compared to their email list.
“Our SMS list is growing kind of without effort,” Wolfson said via phone. “We have a pop-up on our site, and it gives a 10 percent discount code [for those signing up to their SMS list].” This pop-up is only visible to those visiting Bean Goods via mobile.
“This is a great way to capture those who are already shopping using their mobile device and meeting customers where they’re at.”
Wolfson wasn’t surprised by this development. “We have so many users coming from mobile, and the SMS pop-up shows up before our email pop-up,” Wolfson explained.
Bean Goods has also had great success with sales using text messaging. They incorporated text message marketing for one of their last product launches – matching human/dog clothes, to great success. They sent text messages to encourage their customers to sign up to be on a VIP list for the launch of the new products. Wolfson said it was very successful. “We sent it to all of our U.S. customers, and it was an ask to come and sign up to be on early access for the launch,” she explained. It asked them to sign up to their email list, and while there wasn’t a specific call to action to shop, they still made over $1,200 from that text message campaign.
While Bean Goods has seen success in using text messaging, Wolfson also highlighted the biggest drawback to using the medium: “SMS marketing is not cheap,” she said.
Getting Started with SMS Marketing
You need either a longcode or a shortcode to begin to text your customers. A longcode is the same as any landline or mobile phone number that you use exclusively for text messaging with your customers. A shortcode is a unique five or six-digit phone number that can only be used for text messaging and only be used by software.
You can get a shortcode or longcode from an SMS aggregator or provider such as Twilio or Sybase. These companies work directly with the telecommunications carriers, so you don’t have to. There are pros and cons to using a shortcode and a longcode. Shortcodes are much faster. They can send 100 messages per second. So they’re great for extensive lists; but shortcodes are expensive. They cost around $12,000 annually, whereas longcodes will cost only $1.00 per month. The downside to using a longcode is they can only send one message per second.
There are also costs involved in sending and receiving messages. It costs $ 0.0075 to send one message and the same to receive one message. If you include an image, the cost to send goes up to $ 0.02 per message sent and $ 0.01 to receive per message.
There are several services that will manage your text messaging and will often bundle these costs into a monthly fee, such as Postscript mentioned above. And as your text message list grows, so will your expenses.
The other thing to consider is your regulatory and legal requirements. Sending and receiving text messages from a business is highly regulated by the Federal Communications Commission (FCC), the Cellular Telecommunications Industry Association (CTIA), and the Telephone Consumer Protection Act (TCPA). You’ll need to make sure you are in compliance or face serious consequences not only from the FCC, but you could also open yourself up to lawsuits.
Many text message management companies will help guide you on best practices, but it is ultimately up to you to make sure you are compliant with the law.
Despite the cost and compliance risks, texting is a powerful marketing tool, and one Washington believes necessary, “It’s essential for craft businesses to include the SMS channel in their marketing stack,” he said.
Kelly Rand is an author and the Founder/CEO of Handheld Handmade, Inc. Handheld Handmade helps you discover delightful handmade finds all via text message. Launched in September of 2018, Handheld is an innovative and fun way to buy curated handmade items via your text messaging app. To join text HANDMADE to 202-800-9191.
Rand has a BFA in illustration from the Savannah College of Art and Design and has exhibited her work in art galleries and craft fairs alike. She has lectured on the handmade movement for the American Craft Council and provided guest critiques for students at the Maryland Institute College of Art. Rand frequently consults on elements of craft and sustainable business.
Rand resides in San Francisco, CA with her husband and daughter.