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On 3rd December 1992, Vodafone made the first ever contact via SMS. Software engineer Neil Papworth sent a message from a PC – SMS-enabled phones hadn’t been developed at that point – to Richard Jarvis, a Vodafone director. Now, either Mr Papworth was feeling very festive at the time, or he anticipated that the message would take 22 days to deliver, as its contents simply read “Merry Christmas”.

Over the past 25 years SMS – or text messaging as you and I know it – has managed to survive in a world addicted to novelty.

Fast-forward to 2017, and some would argue that SMS has lost a lot of ground in the popularity race to more advanced messaging services such as Apple’s iMessage and WhatsApp. And with Google’s RCS (Rich Communication Services) now entering the fray to support Android devices, the future of SMS in the consumer market seems fairly bleak.

Which makes us ask the question: why is the value of the global SMS market expected to grow to US$70 billion by 2020?

Personalised interactions

Text messaging may have fallen out of favour among some consumers, but it still remains available for use. SMS is the only app that’s on every mobile phone in the world, working across all operating systems and networks – a service in the hands of 5 billion people today. With far more people worldwide able to receive a text message than use an internet connection, SMS is now applied as one of the most effective methods for businesses to talk to their customers.

Today, A2P SMS (application to person SMS), is a form of B2C communication that is seen as a vital touchpoint with customers. People are often unresponsive to emails, and annoyed by disruptive phone calls, but they check their phones frequently throughout the day. An SMS message immediately grabs the attention of the recipient, and this is proven by the channel’s high open-rate – 95 per cent of text messages are opened and read within three minutes of delivery.

Texting

Confined to 160 characters, a text message is naturally concise, containing much less opportunity for extra content than your average marketing email. This forces SMS to be better targeted and more customer-friendly, which is positively reflected in customer perception – 91 per cent of consumers deem SMS a useful messaging channel. With time-stricken customers valuing communications that are both efficient and informative, SMS is a key component of customer relationship management.

A truly global service

Businesses understand why SMS is an effective communication channel, and they ensure that it is still valued by consumers by guaranteeing that all messages are both direct and succinct. By making SMS synonymous with a clear call-to-action (e.g. “reply Y for Yes”, “N for No”, “STOP to opt-out”), businesses have enabled the simplest form of two-way interaction, with which customers are happy to engage.

From a marketing perspective, we see the SMS channel used by organisations for time-sensitive campaigns that need to be communicated to large groups of people very quickly. However, we also see a broader use of A2P SMS to deliver various messages, typically falling into one of the following categories:

  • Special offers, deals and personalised marketing messages.
  • Identity verifications and the resetting of passwords.
  • Customer service updates and urgent service announcements.
  • Internal staff updates.

The above examples of SMS use are often applied to interact with end-users throughout the UK, Europe and North America. However SMS is a truly global service, with a strong demand for it in mobile-oriented regions such as India and China, where PC-ownership is far lower than in the West – Asia Pacific has over a 40 per cent share in the global A2P SMS market. And in developing countries, where smartphones are rare and mobile data coverage scarce, many people are dependent upon SMS for mobile payments and banking services, through solutions such as Vodafone’s M-Pesa.

M-Pesa

Gain your customers’ attention

SMS is a powerful way to instantly reach your target audience, regardless of geographic location, and is a cost-effective form of targeted communication. Vodafone Managed Messaging (VMM) is a A2P SMS solution that uses Vodafone’s secure global infrastructure to help businesses realise this by removing all barriers to the full potential of SMS.

With VMM, businesses only have to work with one supplier to distribute their text messages to recipients internationally, via numerous network providers. This mitigates the need to negotiate local arrangements and individual contracts for each region or country, by operating within a single service agreement.

The text message has stood the test of time. Hardened by years of multi-channelled brand interaction, consumers often welcome the transparency and simplicity of a humble text message. And businesses are working to uncover more uses of a channel that's proving to be a simple route to gaining their customers’ attention.

Want to know more about how SMS can help your business achieve enhanced customer communications? Discover Vodafone’s Managed Messaging solution.

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