SMS is still one of the most popular ways to communicate. But is it a viable channel for B2B marketers? Alex Blyth investigates
Given around half the UK population owns a smartphone, and the proportion of business buyers who own one is likely to be far higher, it seems astonishing that any B2B marketer would continue to bother with SMS marketing. After all, why limit yourself to limited characters of bald text when you could engage the recipient with a graphically rich email, or use an instant messaging platform to build a dialogue, or bring the audience into your own world with an app?
Yet, Chris Minas, founder of mobile marketing agency Nimbletank, says, “SMS remains hugely relevant. Perhaps now more than ever. It is still the most widely used data application in the world with over 2.4 billion active users. In 2011, mobile users sent 7.8 trillion messages and this is predicted to reach 9.6 trillion in 2012.”
Indeed, in July this year, a report from Ofcom revealed that while Britons spent five per cent less time on the phone in 2011 than the previous year, we sent twice as many text messages as we did four years ago. The average Briton now sends an average of 50 messages a week, making texting the most popular form of daily communication.
Many believe SMS can be more than just a popular peer-to-peer platform for digital natives, and a growing number of consumer brands are using it as a marketing tool. Minas claims SMS campaigns regularly achieve response rates of more than 70 per cent and explains this is because over 95 per cent of SMS messages are read by the recipient, and usually within the first 15 minutes of receiving the message.
So given many digital natives are the business buyers of the future, is it time for B2B marketers to look again at SMS? Can it be an effective method of reaching business buyers or is it limited to consumer campaigns? Is it as useful for customer acquisition campaigns as it is for customer service or simple updates? And if it genuinely is a valuable weapon in the B2B marketer’s armoury, how can they go about deploying it to best effect?
A ubiquitous tool
One thing is certain: SMS does not lack for advocates or for research studies showing its continued value. “SMS is very much alive and relevant, and will continue to be so for many years to come,” says Ken Hart, EVP enterprise messaging at mobile messaging firm Acision.
Acision recently conducted a study among 1000 mobile users in the UK, 63 per cent of whom were smartphone users. Ninety-five per cent of the participants stated they actively use SMS. “Reports that suggest SMS is on its deathbed, it seems, have been greatly exaggerated. In fact, it appears that smartphone owners are united by their affection for text messaging,” commented Jorgen Nilsson, chief executive at Acision.
Julian Hucker, CEO at SMS provider Esendex, agrees, saying, “SMS remains the most powerful and ubiquitous way for a business to push an important message out to any phone user.”
Many observers argue that instant messaging (IM) is the future, but Hucker counters this by suggestin that at best IM can only hope to complement SMS. “While IM is growing in popularity, it still has a long way to go to catch up with the reach, reliability and ubiquitous nature
of SMS.”
He adds, “Analysts are predicting that mobile IM will exceed 1.3 billion users by 2016, compared to over five billion users with access to SMS today. While IM is useful to communicate with people in an everyday environment, such as family or friends, SMS is the best tool when looking for a more formal way of communication.”
More reach than email
SMS advocates also claim that it is better than email. Ed Ryan, marketing manager at Esendex, says, “Emails take time to design, write, render in email clients, and after that you are not guaranteed the email will reach the inbox or indeed get heard over the other channel noise. SMS, on the other hand, costs a few pence per message sent, can be written, personalised and sent within minutes. It will reach your customers wherever they are and has a much greater open rate compared to emails.
Ryan offers the following facts as evidence: according to the Mobile Marketing Association in 2009, 90 per cent of all emails were spam compared to one per cent of text messages; according to Frost & Sullivan, in 2010, only 22 per cent of all emails were opened compared to 98 per cent of text messages; and according to ITU, in 2010, the average person received 1216 emails per month compared to 178 text messages.
Simon Armstrong, marketing manager at cloud-based ecommerce vendor, Actinic, adds, “According to research carried out by Text Marketeer and published in August 2012, 61 per cent of respondents received three or fewer marketing texts in the last month with 31 per cent not receiving any messages at all. So the ones they do receive they are likely to read. This is in contrast to a typical email inbox that is overloaded with marketing messages and offers, most of which are ignored.”
Customer service and admin
Yet, while all of this may be true, it is still remarkably difficult to find examples of SMS marketing campaigns in the B2B arena. There are plenty of consumer SMS campaigns. Pick up your own phone, scroll through your messages and you may find some examples.
You may have even found some messages targeted at you as a businessperson, but they are unlikely to be marketing campaigns. Most of them will be customer service notices, for example alerting you to changes in your business bank account, or confirming orders and deliveries.
On top of this, SMS can be a useful administrative tool. At one show, UBM had 22,000 attendees over three days. It set up eight registration desks and 16 self-service touchscreens for people to get their badges using unique reference numbers. Few people brought their numbers, and the result was chaos – thousands of people queuing, getting annoyed and blaming the organisers. At the next show, UBM sent attendees an SMS containing their unique reference numbers, and this reduced queuing time to just five minutes.
SMS is undeniably useful for customer service, event administration and even softer marketing campaigns aimed at existing customers. Yet in the B2B world there is, as yet, precious little evidence that it can be used to acquire new customers. Hucker admits as much. “SMS works best when you already have a relationship with the recipient: to confirm an order or appointment, to tell them about a new offer or discount,” He says. “I don’t believe that it works as a blind medium.”
Testing the water
None of these issues are irresolvable. You should be able to craft an appropriate message that you deliver at a suitable time to a carefully targeted database, to ensure you gain a high delivery rate, a high open rate, a high response rate, and a good return on investment. But, when you can simply fire off another email campaign for free, why bother? There are just two possible reasons why you might.
Firstly, you may have a core of prospects on your database who are unreceptive to emails. “Taking a multi-channel approach can make a refreshing change and deliver impressive results,” argues Jenna Lovell, senior account manager at email marketing company Adestra.
She continues, “If contacts have been bouncing when you try emailing them, and have opted into receive SMS communications, you could gain an updated email address from them via an SMS campaign. Or when recipients unsubscribe from your email communications, you could ask them
if they would prefer to be contacted via SMS.
Secondly, you might want to experiment with the emerging geolocation technologies. “Location-based targeting could be a source of rich, rewarding customer engagement for brands,” says Mark Hadfield, senior planner at marketing agency Weapon7. “Informing me I’m close to something relevant is useful, as are personalised offers pushed to me that I can instantly claim.”
Of course, those are certainly factors to consider but in the foreseeable future it seems probable that B2B customer acquisition campaigns are likely to use email, instant messaging and app opportunities offered by rising smartphone penetration, while SMS will remain a useful tool for customer service and basic marketing administration.
Obstacles for marketers: For all its benefits, there are three significant reasons why B2B marketers have not rushed to use SMS
1. Appropriateness: Many business purchases are large items that involve many people in complex negotiations over an extended period of time. A friendly, chirpy text message arriving over a family breakfast on a Saturday morning might help to boost furniture sales or sell more mobile phone ringtones, but it is unlikely to help sell pensions software to a global corporate. It is in fact likely to damage the sale.
2. Data: Data protection laws may only require that you include an opt-out, but the fact still remains that few businesses have mobile phone numbers for their business prospects. The focus for the past decade has been on email addresses. When it comes to SMS data we are back where we were with email data in 2002.
3. Cost: Adrian Sarosi, director of sales and marketing at OpenMarket, says, “Typically, SMS and MMS attract a per-message fee, which means campaigns will shift in cost depending on the volumes sent. Just like posting a letter, there is a transit cost involved with delivering SMS, and a business should expect to pay 3-5p for a decent quality of service on message delivery.”
