Why Your Startup Needs to be Using SMS Marketing

It’s a surprising concept. New businesses avoid using SMS marketing. At least that’s the premise of an article on Forbes.com.

The idea is that the new businesses are afraid of both annoying customers and of breaking the rules of using SMS marketing.

Well, I don’t think they fear either of those things. First, SMS marketing is opt-in only. This means customers want to get messages from you. Yes, you could annoy them if you overdo it, but you won’t right? Second, staying compliant with the regulations isn’t that difficult in the UK. There are just some simple rules to remember.

So if it isn’t those fears keeping you and other startups away from using SMS, what could it be?

Most startups are short on cash. When it comes to choosing a marketing strategy you need to make difficult decisions. You can’t possibly do everything with your small budget.

So if you aren’t using SMS, it’s probably because you convinced yourself that it’s too expensive for you, or that it won’t give you a good return on your investment.

Let’s look at the “too expensive” reason first. The fact is that SMS is one of the most inexpensive mobile marketing channels. If you have 1000 people on your list (quite a bit for a new startup maybe, but go with it to keep the maths simple), you can send all of them a message for just £35 (fastsms pricing as of this writing).

Now think about what you spend on other forms of marketing – even ones you consider to be “free” like social media. By the time you take into consideration what you pay someone to manage it and any advertising you do on the channel, you probably spend much more than 3.5p per customer.

But the benefit isn’t just the cost of the messaging. When you use social media, TV, radio, or print to advertise you’re basically taking a shot in the dark – or maybe with a small torch. With SMS marketing, you’re sending offers to a very specific set of people: the ones who already like you and want to hear from you.

When they get an SMS message from you, they will read it. And, on average about 30-something percent will act on it. That’s about ten times the average email response rate seen in most industries.

That higher response rate answers the concern about ROI. More customers taking action on your offers means more business for you. And that translates to much higher ROIs than many other marketing channels. You can read about one company that got an ROI of 6,600% in this blog.

If you are a brand new startup, or one just getting its marketing legs, you might be thinking that’s all great. But how do you get a list when you’re just starting out?

If you have customers, then you have a list. Well, you’d have a list if you just asked them to sign up. It doesn’t have to be much harder than that.

The first step is to let them know you have an SMS programme (even if you’re just starting out). Current customers are the easiest to get on your list. They already know you and like you so make sure they join by offering something really good. If you’re not sure what that might be, or how to decide check out this blog for a checklist to use on your first marketing campaign.

If you use all the free means of getting them to sign up, then it costs you nothing extra to get them on the list, but it potentially increases the amount they spend with you.

Also, use those loyal customers. If they love you, there are probably people they know that would too. Send out a deal they can forward to someone, or a link to a page where someone else can sign up too – and you give them some benefit in return for people they bring in. You can read more about using SMS for referral marketing in this blog.

So when you’re looking at how to spend your marketing monies, remember SMS is much simpler and more cost effective than many other channels you might be considering. Not that you shouldn’t use those other channels, but if you have to choose, SMS could be the best option for a startup looking to increase their customer base and profits.