As the changing winds of technological advances continue to drive consumer behaviors, it’s crucial for marketing professionals to adapt their strategies accordingly. The proliferation of smartphones and text messaging combined with stricter safeguards on email inboxes has made SMS/text message marketing an increasingly attractive option for these digital marketers.
And while our recent survey of 300 digital marketing professionals found that text message marketing is generally less impactful in terms of ROI compared to email marketing, most marketers still expect it to be an important part of their strategy in the near future.
In this report, we’ll further explore the state of SMS/text message marketing to discover:
- The effectiveness of SMS/text message marketing compared to other forms of digital marketing such as email marketing
- The tools and tactics being used by marketing professionals to reach their goals through SMS/text marketing
- How frequently digital marketers are sending SMS/text marketing messages as part of their mixed marketing strategy
- The future role of SMS/text message marketing in modern marketing playbooks
Let’s jump in.
Despite much higher open rates, text marketers report both lower ROI and effectiveness compared to email marketing
Studies have shown that 70% of consumers consent to receive marketing texts, and more than half check their mobile text messages 11 times a day or more, making the text message inbox the most frequently used app on consumer’s phones[1].
Because consumers must opt in to receive SMS and text marketing messages, you might think that engagement on these messages would be relatively high. However, much like email marketing, just getting your foot in the door of someone’s text inbox doesn’t necessarily translate into optimal results for marketers.
SMS/text open rates are inconsistent, but still far outperform email
Respondents to our survey reported encouraging levels of engagement with their SMS marketing efforts. More than one-third (36%) of SMB marketers reported an average open rate of 41-60% on their SMS/text marketing messages.
And 17% of our respondents reported an open rate of 81% or higher, meaning that—on average—at least 4 out of 5 of their marketing text messages are being opened by the recipient. Can you imagine seeing open rates like that on an email marketing campaign?
In fact, our recent email marketing survey found that only 11% of respondents reported an open rate of even 25% or more.
ROI skewed in favor of email marketing
While text message marketing enjoys a clear edge over email marketing when it comes to getting recipients to open the message, this advantage isn’t quite that simple.
More than half (51%) of SMB marketers reported an average ROI of between $21-$40 per dollar spent on their SMS marketing campaigns, which is nearly identical to our email survey findings.
However, a discrepancy is revealed when looking at the highest-performing end of the spectrum. While 27% of email marketers reported an ROI of $41 or more on their campaigns, only 22% of text marketers claimed an ROI of $41 or more. In other words, while both email and text message marketing campaigns show consistently favorable ROI for marketing teams, email still seems to top out at a level unmatched by text marketing.
Of course, there are many other factors at play here, such as the types of messages being sent, the frequency, the content included, and the resources used to support these campaigns, all of which we’ll explore below.
Overall, digital marketers find email marketing campaigns to be more effective
Besides what our open rate and ROI findings bear out, digital marketers themselves report that email marketing is more effective than text marketing.
Our survey found that 67% of text marketers rated the effectiveness of their campaigns as moderately (44%) or very (23%) effective. However, our email survey revealed that 74% of email marketers rated the effectiveness of their campaigns as either moderately (39%) or very effective (35%), giving email marketing a significant edge when it comes to “very effective” campaign performance.
Improving the ROI and effectiveness of text marketing campaigns
As we’ve seen, getting recipients to open marketing text messages isn’t the problem for digital marketers. It’s what happens after the recipient opens a message that determines the effectiveness and ROI of text message marketing campaigns.
What you include in your marketing SMS messages, what time of day you send them, and who you send them to are all factors that can drastically alter the effectiveness and ROI of a text marketing campaign. Digital marketing experts can help you and your business fine-tune these variables to get the most bang for your buck.
Text marketers struggle to find the best service providers and tools
Achieving an acceptable ROI was one of the top challenges reported by 40% of our respondents, just behind finding the right service provider to partner with (41%) and finding the best tools and SaaS resources (41%).
Other reported challenges include creating effective content for campaigns (38%), getting recipients to engage with messages (37%), and building out a list of recipients (34%).
Interestingly, solving the top two challenges in this list—finding the best service provider and finding the best software resources—could also be the solution to every other reported challenge, as the right tools and service providers can help marketing teams target the right audience and create compelling content that drives engagement and ROI.
ROI is driven by the types of texts being sent
Text messages offer a limited platform for engagement with customers, as marketers are forced to craft powerful marketing materials that fit within the smaller screens and interfaces of mobile devices.
To further investigate this, we asked our survey respondents about the types of marketing text messages they send most frequently and found that two types stood out above the rest:
- Sales, coupons, and promotional messages (45%)
- Customer reengagement messages (35%)
Indeed, digital coupons are ideal for SMS marketing campaigns because they are well-suited for quickly grabbing a recipient’s attention with just a few words, and they can be used to improve conversion rates and track the effectiveness of your campaign through the use of coupon codes[2].
Service providers play a significant role in text marketing campaigns
While a little over one-third of our respondents (35%) reported that they are primarily using in-house marketing teams to manage and execute their text marketing campaigns, more than 40% are already relying on either a digital marketing agency (25%) or contractor (16%) to oversee their campaigns.
With another 19% of respondents saying that they use some combination of in-house and outsourced teams, it becomes even clearer that digital marketing agencies play a crucial role in text message marketing campaigns.
As we discussed earlier, the right service provider can help small businesses maximize the impact of their text message marketing campaigns. So even if you have an experienced team that is confident in their ability to manage an SMS campaign, you could be missing out on improved engagement and ROI if you’re not enlisting outside help.
Text frequency is key to the effectiveness of text marketing campaigns
Like ad placement, email marketing campaign distribution, and paid ad campaigns, timing is important when it comes to text message marketing. Comparing the data from the SMS marketing survey to our email marketing campaign survey, we found that marketers prefer sending marketing text messages on a weekly basis, similar to email.
Almost half (44%) of the SMB marketers we surveyed regularly send SMS/text marketing messages on a weekly basis, while less than a quarter (23%) send daily text marketing messages. By contrast, our email survey found that marketers were almost evenly split between executing daily email marketing campaigns (32%) or weekly campaigns (33%).
This suggests that text marketers are a little more reluctant to bombard their recipient list with daily messages, which makes sense given how intimate consumers are with their smartphones.
While a daily stream of email marketing messages might go largely unnoticed for weeks in someone’s ever-growing email inbox, a constantly buzzing phone is sure to attract attention. But if your repetitive, incessant marketing messages are the source of that buzzing, there’s a good chance that your recipient list will start shrinking quickly.
Regardless of whether you decide to send marketing text messages on a daily or weekly basis, make sure that you have an opt-out policy in place and that you respect requests to be removed from your list.
Despite middling confidence, most marketers consider text marketing an important part of future strategy
As we discussed above, 35% of SMB marketing teams are executing text marketing campaigns primarily in-house. But only 31% of those teams said that they’re “very confident” in their team’s ability to successfully run an SMS/text message marketing campaign.
This lukewarm level of confidence paints a picture of SMB marketing teams that are struggling to achieve their goals through text message marketing but still trying to resolve these issues on their own.
That kind of approach is likely to lead to an unnecessary waste of time and resources compared to teams that recruit outside expertise to support their campaigns.
Service providers provide the necessary performance boost in text marketing to give it longevity
Almost 60% of text marketers somewhat (36%) or strongly (23%) agree with the statement that SMS marketing will continue to be an important part of their marketing strategy in the next 3-5 years.
This suggests that even though teams struggle to reach their marketing goals using text marketing and they lack confidence in their ability to run a campaign with a high level of effectiveness, there is still optimism among more than half of marketers that this technology is too powerful to ignore.
On the other side of the coin, 23% of SMB marketing teams disagree with the prospect of text message marketing being a tool in their marketing arsenal in the near future.
Small businesses that neglect to use this powerful marketing tool risk missing out on a massive opportunity to reach potential customers. If your team is struggling to reach your goals through text message marketing alone, consider recruiting an experienced digital marketing agency to help optimize the content and cadence of your campaigns for maximum effectiveness.
Incorporating SMS messaging into your marketing strategy
Don’t be part of the 41% of marketers struggling to find the best service provider for their SMS campaigns. Connect with a top-rated direct marketing agency to help your business reap the rewards of a well-optimized text message marketing program.
Survey Method
This survey was conducted in August of 2023 among 300 U.S. marketers to learn about SMS message marketing results and preferences. Respondents were screened for their role overseeing text message marketing campaigns.