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These three SMS marketing KPIs (key performance indicators) will help you grow your business and improve text marketing campaigns.

Most companies do not analyse SMS marketing conversions – shows our report “SMS Communication in Poland”. Those that care about the campaigns’ effectiveness measure it using the CTR (click-through rate) of the link in the message, average sales increase or the percentage of discount codes used. What factors should you consider to call a campaign successful? Read about KPI in SMS marketing.

Since we’ve switched from SMS or phone calls to instant messaging via WhatsApp or Messenger, we do not often hear an incoming SMS signal. Nevertheless, a new text message notification reminds us of something essential and urgent.

As a result, the open rate of SMS messages is still high (up to 98%), and most people read text messages up to 5 minutes after receiving them. However, this is only half of the success. Apart from the Open Rate, other possibilities for assessing SMS marketing effectiveness are worth knowing.

SMS marketing KPI: delivery rate

A good and well-maintained customer database can serve for years, but many people can change their phone numbers or lose interest in the offer. Thus, it’s worth comparing lists of sent and delivered messages. We recommend running such checks regularly to keep your database effective and to lower conversion costs.

Key questions: delivery rate of SMS campaign

• Are there returning customers in my database?
• Do I personalise messages by interests and preferences?
• Are the buyers interested in purchasing my product again?
• What would make their comeback?

High CTR starts with a high deliverability rate

Click through rate (CTR) is one of the key metrics, but way more important is the one that impacts your conversion rates: quality of contact database. It’s the foundation of SMS marketing campaigns’ success.

Since the text messaging standard was established over 30 years ago, it has certain limitations. For example, no one thought measuring the exact open rates of text messages would be necessary, just like in modern marketing channels.

You can check whether numbers in your database are still active before you even send SMS messages. It’s a good start – you cut costs and increase the average conversion rate.

Check if the number is active using the HLR (Home Location Register) function. You can check records individually or run a complete database sweep. The HLR lookup will result in a list with inactive numbers marked. A simple comparison of input and output records will allow you to exclude invalid contacts and check the registry of phone numbers in the appropriate GSM network.

Check other features of SMS gateway

What else affects your marketing efforts and return on investment?

We can’t stress it enough: SMS marketing campaigns are one of the most personal communication channels. The closer you get to your audience, the better. Your SMS marketing ROI depends on it. There’s a simple yet effective way to ensure your clients will better understand the context and reason of the message: use the data and personalise the content of the SMS message.

Furthermore, it’s also worth knowing the recipients’ preferences. You can get them by doing a quick survey or collecting data during signup to your text marketing campaigns. Both methods target future campaigns according to specific parameters, e.g., gender, age, shoe size, and tailoring content and offer to particular groups. Personalised SMS campaigns are considerably more effective and have lower opt outs.

Know your SMS KPIs: opt-out rates

The SMS opt-out rate is the number of unsubscribes divided by the number of all recipients. This metric allows you to define a share of subscribers not interested in your messages. Although it might seem unreasonable, it’s best to present them with a quick way to unsubscribe from the newsletter. After all, opt out should be equally easy as opt in.

Clicking a personalised opt-out link attached to an SMS allows unsubscribing from the database and excluding yourself from future campaigns. Removing uninterested customers favours the effectiveness of the database, advertising budget, and brand image.

SMS KPIs: conversion rate

You should start to monitor the response of the recipients as soon as the SMS campaign hits their phones. Knowing how many messages were opened is crucial, but the number of people who clicked the link inserted in the SMS measures the effectiveness better. In other words – always check CTR (click through rates). And since you can generate a specific link for each recipient, prepare follow-up messages for those who didn’t tap the URLs.

Our reports show that about 40% of companies insert links in SMS messages, and the average CTR of the links is more than 17%. This means that the recipients read the messages and willingly take the next step on the customer journey.

Similarly to email marketing, the primary determinant of bulk SMS effectiveness is the conversion rate. This indicator shows how many recipients made the purchase and became customers after the campaign. Estimate results of the text marketing campaign and track traffic intensity in e-commerce, e.g., in Google Analytics and compare it with the same time interval for previous days or with average traffic for that day of the week.

You can track the SMS campaign’s effectiveness by adding UTM parameters containing the medium type and campaign name in the link and then shortening it with a tool such as cut.li. These two actions help to measure the number of clicks and shorten the message.

How to add UTM parameters to shortened links?

The same can be achieved in retail stores using a discount code or coupon in the message, which can be generated online and shown while purchasing. However, use the code only in the SMS campaign, so you will quickly check its effectiveness.

Why SMS KPI?

SMS marketing KPIs determine whether the direction chosen in the marketing strategy meets with a positive market reaction, whether the tools selected to achieve this goal are correct, and whether the messages are appropriate for customers.

What are the three KPIs your overall SMS marketing strategy should include?

• delivery rate,
• conversion (click through rate),
• opt out rate.

Without the knowledge of the deliverability, conversion rate (CTR) or opt-out, the marketers would have to rely solely on intuition, and that’s not good for business. SMS metrics will help your marketing team to make educated decisions. Final thoughts: test and measure everything you can, always.