Got the message?
- Article 2 of 6
- Database Marketing, December 2002
With more and more mobile numbers becoming available to marketers, Robert Buckley finds that the latest handset technology still has a long way to go to beat SMS as a marketing medium.
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SMS messaging was the surprise hit among consumers of the first generation of digital mobile phones. No one expected the ability to send short messages of 160 characters would become almost more popular with phone users than making calls, with 186 billion messages being sent each year and 90% penetration of the market. Marketers were not slow to notice this trend and began integrating SMS messaging with traditional channels as part of their campaigns, both as relationship tools and for prospecting. As the next generation of phones with always-on Internet access and multimedia messaging emerges, has SMS yet found its niche and what is its future?
For marketers using the technology, the benefits of SMS are clear. “We've been working on SMS marketing for three years,” says John Farmer, director of SMS marketing specialist Carbon Partners. “SMS brings interactivity to a lot of other elements and provides a target audience with an instant response mechanism.”
Pamir Gelenbe, co-founder and director of corporate business development of mobile marketing firm Flytxt, argues that messaging is a lot more effective than direct mail since messages do get read when they are received and it costs one-sixth to one-seventh the price.
No wonder it is so popular now. As many as 83% of media companies are using SMS are part of their brand awareness and marketing campaigns, according to a survey by Benchmark Research, a UK-based market research firm. Many have used it as a relationship tool, with more than 40% having tried to run SMS quizzes; sports updates and voting have proven popular in 30% and 23% of cases.
Broadcasters GMTV and Channel 5 are two such users. Nog Sawdon, head of interactive services at GMTV, says that the company is increasingly moving towards SMS as a replacement for paper-based services, including competitions. “It's a good brand enhancement and I have more belief in it than interactive TV.” In contrast, 5 News invites viewers to comment on stories by text message, the results of which it includes in the programme. The company then asks contributors if they want to receive offers and further information via SMS so it can build up an opt-in database of mobile users.
“SMS provides us with a cost-effective, highly-targeted method of communicating with our audience in new ways,” says Adrian Monck, managing editor at 5 News. “Over the next 12 months, we’re looking to develop our mobile marketing strategy since we believe there are excellent opportunities for one-to-one interaction with our viewers using mobile technology. In comparison to personal email addresses, which are changed on average once a year, mobile phone numbers are currently retained for at least three years.” He is very confident that SMS will prove to be a valuable marketing tool for 5 news that will allow it to increase the strength of its brand and extend its relationship with its audience.
Apart from the huge market penetration of SMS and its ability to provide prospects with a way to reply instantly to a campaign, the high response rates from SMS campaigns are making it popular with marketers. Gary Corbett, managing director of Opera Telecom, says that the response rate is usually five times greater than that of a direct mail campaign, while Carbon Partners' Farmer says that a typical campaign will get a double-digit response rate, as long as the offer and data are good. And the chances of that are lot better than they were even just a year ago, with both lists and in-house data far better tailored to the SMS market.
“Access to good data is definitely improving a lot,” he argues. “Going back a year, you couldn't get information for all the right demographic slots and it was pretty poor. A lot of it was opt-in by default – the prospects had opted in for information from other sources but no mobile data was collected. Now you can get quality data that's been acquired in the right way and checked off by a third party.”
Corbett agrees that data has improved, particularly as companies have improved their own data acquisition. “There's been a big change in the last year and a half as people have realised the value of SMS as a medium. Getting mobile phone numbers has become a part of data collecting.”
What is important with all these lists is that they are all opt-in. Sending broadcast messages to people who have not opted for them is almost universally looked down upon by other marketers. Icstis (Independent Committee for the Supervision of Standards of Telephone Information Services), an independent watchdog that supervises premium rate telephone information and entertainment services, fined marketer MobyMonkey £50,000 in August after receiving 200 complaints over a message for a premium rate phone line that some people had received 40 times in one day or whose children had received them. Icstis director George Kidd said the fine reflected the “serious consumer harm caused by the service and its promotion, and will act as a warning to the industry.”
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