New research reveals poorly executed SMS marketing deters customers from buying, leading to drops in revenue amidst a looming recession

Validity, the leading provider of data quality and email deliverability solutions, released the findings of its new State of SMS Marketing in 2023 report. Over 1,200 SMS, text, and WhatsApp users across the United States, United Kingdom, Australia, and New Zealand were surveyed, with findings indicating that when done well, SMS marketing encourages customer engagement and spending. Conversely, when done poorly, it can have crippling implications for a company’s bottom line.

SMS marketing has become a widely adopted practice, and when complemented with email marketing efforts, has enabled brands to reach an array of customers directly on their personal mobile device. With timely promotional pings and reminders of an abandoned cart, SMS and messaging drives customers to buy. In fact, 38% of customers have been influenced to purchase a service and 50% have been influenced to purchase a product because of a brand message they received via text or WhatsApp.

However, there is a fine line between positive and negative brand experiences when it comes to SMS. A major concern is a perceived lack of purchase history knowledge and blatant disregard for customer communication preferences. Why does this matter? As customers are bombarded with more mobile communication than ever before, marketers risk losing customers and valuable revenue if they don’t create personalized messages that are delivered at the desired cadence. Notably, 96% of customers report finding themselves at least occasionally annoyed with SMS marketing, particularly when messages aren’t relevant to their needs or contain products that they’ve already purchased.

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Some customers go as far as abandoning a brand due to this irritation. In fact, 28% of those who have felt annoyed from brand messages have completely stopped doing business with companies and 28% report purchasing less – entirely due to irritation with a brand’s marketing text messages. What’s worse, poor SMS practices extend beyond a single disgruntled customer: 14% of customers that have felt annoyed from brand messages report having left a negative public review of a company due to irritation with marketing text messages. When implementing ill-crafted SMS strategies, marketers create a domino effect of poor experiences, lost customers, decreased revenue, and damaged brand reputation – all of which can be mitigated by honoring customer preference.

“With bleak economic conditions projected for the coming months, it is increasingly critical to reach customers where they’re at – which in today’s world is via SMS,” said Kate Adams, SVP of Marketing at Validity. “Marketers who’ve mastered the art of SMS are able to create campaigns that increase customer engagement and satisfaction, and ultimately drive revenue for their business. But the findings of this report are also a cautionary tale because the opposite is equally true. When SMS is done poorly, businesses risk alienating large swaths of customers. Unfortunately, many marketers don’t know how to incorporate SMS effectively, and often attempt to apply age-old email marketing tactics – which aren’t effective in this medium. It’s crucial that businesses invest in training for their marketing teams so they are able to effectively adjust how, where, and with what frequency to employ SMS messaging tactics.”

Additional key report findings include:

• 19% of respondents list SMS as their most preferred brand communication channel (ranked above email, social media, direct mail, or app notifications). In fact, 16% would ideally like to receive these messages from brands 2-3 times per week.
• Nearly half (49%) of respondents reported that brands messaging too frequently was what annoyed them most about SMS messaging.
• To mitigate this challenge, brands should consider giving consumers the ability to customize the frequency with which they receive messages from brands. In fact, 97% of respondents report that they would prefer this feature and, of those, 81% say that this capability would make them more likely to purchase from or do business with a brand.
• Data privacy also poses a risk for customers with 70% reporting they’re worried that texts from brands might pose a data risk. Of those, 66% are concerned about companies selling their data and/or clicking links within brand messages due to risk of scammers.
• But the majority of customers are willing to risk it, with 66% of respondents who believe SMS messages from brands pose a data risk, reporting they continue to sign up for texts, SMS, and messages from brands because of the potential rewards – including company updates, shipping notifications, and free merchandise.

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