Friday, June 18, 2010

Text messaging: the third realm of mobile commerce

Text message marketing offers benefits other mobile technologies don’t, Tim Sherwin, vice president of CardinalCommerce Corp., an e-commerce and m-commerce technology provider said at the Internet Retailer Conference & Exhibition last week.

First off, unlike an app or m-commerce site, texting is immediate. A retailer can deliver a message to a consumer’s handset anytime and anywhere, or a consumer can send a text to a special number for a reward, such as a coupon. And, for those retailers sending messages, Sherwin says, most will get read. The U.S. boasts a 95% read rate for opt-in text messages, he says.

To get started with text message marketing, retailers need to register and purchase a short code—a five-to-six digit number—with the Common Short Code Authority, the regulatory body that protects consumers from text spam. Short codes cost anywhere from $1,500 to $3,000 per quarter. Retailers also need to be sure and follow regulatory best practices and rules including allowing consumers to opt-in and opt-out, and offer such options at the end of texts as help, quit, stop, unsubscribe and cancel.

To monitor the sending and manage a text campaign, retailers may want to use a web-based text message application, Sherwin adds. For example, such a system can maintain opt-in lists, manage demographics, and help retailers define, keep track and launch text campaigns.

Beyond managing a text campaign on the back end, retailers need to be careful about how they approach sending texts to consumers. For example, Sherwin advises to be mindful of time zones. “Segment lists based on zones or launch the text campaign during common hours, such as between 3 p.m. 9 p.m. Eastern,” Sherwin says.

There’s limited space to work within a text message, Sherwin adds, as most phones cap messages at 160 characters. So retailers need to be short and to the point. “Tell the customer what is in it for them,” he says.

Sherwin adds that special text offers such as a coupon code often work well. And, while teens may understand text lingo, older consumers might not, so retailers should be mindful of their audience when sending messages.

To increase conversion, Sherwin suggests retailers provide a direct and immediate service. For example, a message might provide a store locator service to find the nearest location to redeem a coupon code or provide an address to a mobile site where customers can purchase right then.

In addition to sending messages, retailers can prompt consumers to send texts to receive services or discounts. For example, web and catalog retailer SkyMall places the phrase, “Order from your cell phone. Text your item number to 49432,” throughout its print catalog. Retailers can take the same approach with e-mail, Sherwin adds.

Retailers are successfully implementing text campaigns into their overall marketing strategies. Signs inCrocs’ 180 U.S. stores, for example, promoted a 15% discount on any purchase—no limit, no minimum. To get the discount, customers texted “Crocs” and the store number to the retailer’s short code. Within seconds they received a reply text message with the coupon, which contained a code that a cashier entered at checkout. In two months time, customers made 94,000 requests for the coupons, Sherwin noted in his presentation.