2022: the year of SMS marketing. With cookies continuing to diminish, brands understood the need to gather more first-party data and marketers got more creative in their customer outreach, including text messaging opt-ins. With SMS open rates reported at 98% and response rates at 45%, brands are fully embracing this tactic to build on their existing customer communications.
SMS marketing services have also made it easy for marketers to adopt these products with lower entry costs. Sending mass texts at less than $.01 per customer, and with direct integration with ecommerce platforms, it seemed like a no-brainer. However, with the spike in companies embracing SMS, many consumers have found themselves overwhelmed with the volume of texts they’re receiving from their favorite brands.
While text messaging tends to feel more personal than other forms of communication, it can also feel more intrusive. We’re used to reserving this format for connecting with friends, family or even coworkers — all of whom you have a close personal relationship with. It’s easy to feel a sense of crossed boundaries if you’re receiving multiple messages per week from brands with varying promotions, even more so if that product is not relevant to you.
SMS Recipients Expect Personalized Messages
As with the text messages that your customers receive from their personal contacts, they expect a level of personalization. Many of us have subscribed to receive an initial welcome offer, but staying subscribed to an SMS list takes effort and strategy from the brand. Blasting your entire database may drive some conversions, but there is significant marketing waste involved and you risk losing these valuable customers — not to mention the damage to your brand reputation.
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Your personalization strategy should go far beyond using a customer’s first name or location in your messaging. To be effective and stand out amongst the noise without irritating your loyal customers, consider these SMS marketing best practices.
Know Your Personas and Their Preferences
Beyond SMS, incorporate well-defined and distinct personas into your strategy. Using personas built on AI is an efficient and effective place to start, as these are generated from hundreds of data points to cluster customers based on their most distinct attributes and product affinities. Each persona behaves differently — from favoring a certain set of products to the frequency of their purchases. Use this information as well as lifestyle images, user-generated content and blog posts to your advantage and segment your audience by behaviors and affinities.
Target Customers in the Top 20% of ‘Propensity to Purchase’
These are customers who have a very high likelihood of purchasing within a given time frame. “Propensity to purchase” is a customer-level metric based on past purchase behaviors. You may use a classification model that takes into account the quantity of products and orders, statistics around product prices and time between purchases, time since last purchase, time since acquisition and a number of additional characteristics.
Engage Your Highest Value Customers (top 10% AOV/LTV)
This group has a high average order value or a high lifetime value, making it low-hanging fruit that’s likely to increase immediate revenue. This group may respond well to rewards programs that they’re opted into or may just require a nudge to result in a purchase.
Tailor Messages by Product and Category Affinity
Send product-specific copy based on a customer’s stickiness to a particular product or product category. Utilize your personas to predict preference for specific products or product categories, or analyze sequential purchases to predict which product(s) a customer is likely to purchase next for the best results.
As an example, let’s say your brand is getting close to launching new products. However, you have inventory left from the previous season, and you’ve been tasked with reducing the leftover inventory. You could utilize your personas to know which ones are most likely to purchase the excess products, if a discount is required and how best to message to your customers.
Ensure that every new customer you acquire gets mapped to a relevant persona, so you can track the performance of the personas over time. Leveraging these personas in your SMS campaigns allows you to send the right message to the right customer so that you are not blasting your entire CRM with a broad, irrelevant message.
With a personalized approach, you’ll reduce marketing waste and expand your base of loyal customers. We’re predicting that 2023 will be the year that your business gets even smarter about their SMS strategy.
Cary Lawrence is the CEO of Decile, a customer data and analytics platform with a mission to help ecommerce brands grow profitably. Decile spun out of SocialCode in July 2020 where Lawrence was a Co-founder back in 2010. SocialCode’s goal was to transform marketers into more responsive, data-driven institutions that connect more deeply with their customers. Prior to SocialCode, she worked in the Ad Innovations group at Washington Post Digital and served as a Program Associate at the Aspen Institute in the Communications and Society Program, and she has roots in the agency world.
