The Power of SMS Marketing in Banking

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Think about how to use your own mobile device. When is the first time you watch it during the day? What news do you check first? Which messages are you most likely to reply to? For most people, the cell phone is viewed and text messages are displayed within minutes of waking up before opening an email.

When it comes to direct marketing, no channel is more immediate or impactful than SMS marketing. 68% of people say reviewing, sending, and replying to text messages is the most engaging activity on their phones throughout the day. In addition, 82% of consumers say they open every text message they receive.

Key factor:

82% of consumers open every text message they receive.

Since the pandemic, more and more companies have been using SMS marketing to communicate with receptive customers. With open rates much higher and faster than email, SMS marketing is an extremely effective way of reaching a large audience of consumers with important messages.

Research has shown that it takes 90 seconds for someone to reply to a text message compared to the 90 minutes or longer it takes for someone to reply to email. Since most consumers have their phones with them at all times, SMS is an extremely reliable way to reach your target audience. While text messaging cannot have the depth of other forms of communication, text messaging has become so popular because of its ease of linking content and compatibility with all brands of mobile devices.

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Essential insights into SMS messages

More than ever, consumers expect the brands they work with to communicate in real time at a personalized level. There is no communication platform that is as direct and agile as an SMS message. While over 65% of the world use text messaging regularly, only about 40% of marketers use SMS SMS. The delay in adoption by marketers is a combination of a lack of familiarity with maximizing the effectiveness of the channel and concerns about the perceived intrusion of the channel.

While email inboxes and social media feeds are overflowing with direct-to-consumer brands encouraging people to buy, brands are looking for new places to talk to customers they haven’t had enough of to hear from brands. In fact, over 75% of consumers say they would rather receive promotions via text message than see ads while browsing the web and social media. By giving consumers the choice of toggling on or off, you’re giving them control over the messages they see rather than interrupting their social media browsing.

According to SimpleTexting’s 2020 Text Messaging Marketing Report, 42% of Millennials check their text messages an average of 10 or more times a day. When asked, “How quickly can you review your text notifications throughout the day?” Nearly 60% of consumers surveyed said they checked within one to five minutes of receiving the text. In fact, 68% of respondents said reviewing, sending and replying to text messages is the most engaging activity on their phones throughout the day, followed by:

  • Checking social media updates.
  • Check your email.
  • Make calls.
  • Consume news or entertainment.

Similar to all communication options, consumers have preferences regarding the types of information they would like to receive in the form of text, the frequency with which they would like to receive text from companies, and other preferences. For example, when it comes to SMS marketing, consumers are most receptive to tracking texts (75%), order confirmations (65%), planning reminders (46%), and specials (35%). In addition, the majority of respondents (60.8%) would like to have the opportunity to inform companies about customer support issues.

Key factor:

60% of customers want to actively notify companies of customer support issues.

When it comes to who consumers want to receive text messages from the top three industries, customers say they are more likely to choose text messaging: e-commerce / retail (46%), healthcare (43%), and banking or financial institutions ( 41%). Businesses see 98% open rates and 36% click-through rates for specials because consumers enjoy having great deals direct to them via text instead of browsing websites, emails, and social media.

When asked about the benefits of SMS-SMS, over 62% of business owners and marketers surveyed said that the fastest delivery of messages is the biggest benefit of SMS for their target audience, followed by greater customer loyalty and cost efficiency. With consumers having their phone in hand almost every waking moment, the speed of messaging and engagement for SMS text messaging is hard to beat. Text marketing is also very inexpensive when compared to other forms of digital marketing and advertising.

Key factor:

Text marketing is incredibly effective with an open rate of up to 98%.

When asked about the top motivation for using SMS-SMS, over 52% of businesses said that having a large mobile audience was their main motivation for investing in text marketing, followed by the ability to have strong customer loyalty, real-time reach and high-reach open rates.

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6 Ways To Maximize The Success Of SMS Text Marketing Campaigns

If you are trying to recommend a new service, activate a dormant account, or provide guidance at a time when there is a potential need, communicating over the mobile channel is one of the most effective options. SMS marketing is a low cost, high return on investment marketing process that enables customers to receive short messages or multimedia content.

Below are some of the most effective SMS tactics that can help you increase engagement and response rates.

1. Get permission. Before texting your customers, you need to get their permission – legally. Asking permission is a great way to discuss how text messaging will be used in the future, and it’s easy for you to hop on or off. This simple process will increase engagement in the future.

2. Send time sensitive messages. SMS messages can be perfectly timed based on consumer behavior. From a welcome message after opening a new account to an engagement or special offer message that allows a customer to use a product or service more effectively, SMS is an ideal marketing channel for communications that need to be opened and processed quickly.

3. Integrate with other channels. With just 160 characters, you can get more out of a campaign if you use other channels in addition to SMS. For example, you can send personalized videos, images and links within a text to your website and supplement SMS messages with e-mail, mobile banking messages and even telephone contact.

4. Personalize SMS messages. As with any outbound marketing, customers respond best to messages addressed directly to them. Text marketing allows you to tailor your message to each recipient based on the data gathered from customer intelligence.

5. Reference positions. Location-based text campaigns are a method of personalization and an effective way to initiate action and engagement. This type of communication can direct you to a local office or provide you with an offer from a local company.

6. Measure effectiveness. SMS marketing offers a direct, measurable and traceable marketing channel. You can easily tell which messages and promotions are working and which are not. This is how you can refine and improve your text campaigns. Most importantly, you can capture leads and text-based responses for sales follow-up.

Text messaging has become one of the most effective ways for financial institutions large and small to engage with customers and prospects in a very personalized and immediate way. As more consumers choose digital channels, the use of text messaging is definitely increasing. Because these campaigns are more successful than any other existing channel, companies are finding new and exciting ways to integrate into their marketing plans.




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