The world’s very first text message was sent almost three decades back. The sender, 22-year-old engineer Neil Papworth didn’t think it was a momentous event back then, but SMS has been and will continue to be a powerful channel for businesses with a keen eye on customer engagement. A Mobilesquared report titled State of The Global Messaging Market revealed that in 2022, total messages sent per unique smartphone stood at 2.4 trillion messages and this number is all set to rise to 8.7 trillion in 2030. Today, over 90% of CPaaS providers offer SMS as a channel for customer communication. Sounds promising, right? And so, it is.
With a powerful reach of over 98% and an open rate of 95%, SMS is the go-to channel for most brands. Most businesses agree that SMS drives more conversions for them than any other channel with the number inching to 45%. Now, for a channel that drives up to 45% sales for your brand, have you wondered whether you have been able to tap the true potential of every sent SMS?
Unfortunately, even if 1-2% of your SMS remains undelivered, the quantifiable loss is certainly worth a thought. Let’s try and understand this in depth.
Enterprises and SMS service providers: Reaching the audience
To handle the bulk of customer communications, enterprises rely on CPaaS providers. This ensures that critical messages reach the intended customer in a timely manner. An SMS service provider will ensure that the relevant critical or promotional message reaches the right person. But does every message reach them? Unfortunately, not.
There could be many reasons why your SMS did not get delivered. Besides delivery rate, SMS service quality is comprised of latency which is the average amount of time between a send requests and message deliveries and database quality that is the validity of the mobile phone numbers provided by the client.
These are problems that enterprises often discuss while choosing their CPaaS partner and most end up choosing the “best” partner based on the cost, experience, and repute. Unfortunately, most businesses tend to side with partners that seemingly offer the best pricing, which is fair but what if we say it comes at a cost?
Does an enterprise have complete control over every message?
Now, that is a question enterprises must think about.
Sample this. BusinessB partners with SMS service provider A to handle the bulk of SMS communication with customers. Vendor A was shortlisted based on pricing, which was the most affordable of the lot. After every SMS campaign, Vendor A claims to have delivered 99-100% of messages and so far, BusinessB is happy about the progress.
A month or two later, the enterprise discovers that the SMS marketing campaigns do not seem to influence the customer. Even when nudged at the right moment, the customer has taken no action resulting in a dip in ROI. What went wrong despite a 100% delivery?
Have you come across a scenario like this? Well, the messaging ecosystem is so complex that unless an enterprise has complete control, there are consequences for your business.
Let’s learn a little about the complex ecosystem that we’re talking about:
If you look at the message delivery side, there can be four scenarios:
Scenario 1:
An enterprise tries to send messages to the customer. In this case, the messaging partner could be the direct operator. Enterprises can take direct connectivity from the operator, send messages to the operator and the message gets delivered to the intended end user/customer.
Scenario 2:
In this case, a message is submitted to an aggregator or a channel partner. Instead of using a direct operator connect, the aggregator can choose to deliver the message through a SIM farm.
Scenario 3:
An enterprise sends a message, and the aggregator receives this message. The aggregator has a direct operator connect and these messages are further sent to operator and this message is sent to an operator.
Scenario 4:
When the message sent by an enterprise to the aggregator is further passed on to another aggregator (and this may be a chain). This usually happens because the aggregator is not directly connected to the operator. The final aggregator who is connected to the operator then submits the message to the operator.
In any of the above scenarios, if the message delivery gets impacted, an enterprise has little to no control over it. Messages may be undelivered impacting the enterprise in any of the following ways:
How does an undelivered SMS impact your business?
Lost opportunity cost
What is the cost of a lost opportunity? Sample this.
Since most organizations send messages in high volumes, a difference in delivery rate of 1-2% has a significant indirect cost. Sadly, this often tends to be overlooked. Here’s the math.
Suppose an enterprise sends 1,00,000 messages. The SMS service provider claims to have delivered 98% of these messages, which means 2% of 2,000 messages weren’t delivered due to various reasons. The impact of those undelivered messages will depend on the intention of the messages and what it would have meant for the customer.
Broken customer journey
At a time when businesses keep their customers at the core, broken customer journeys can only mean harm. Customers expect businesses to keep them updated about everything, be it new launches, product recommendations, product upgrades, deals, and discounts etc., besides important transactional updates. If the customer does not receive these communications on time, chances are they will switch over to your competitors who may be able to deliver a superior customer experience.
Loss of credibility
At a time when companies are focusing on customer retention, an undelivered message or multiple instances of SMS delivery failure can lead to loss of trust among customers. This in turn can lead to your customers mistrusting you or they may not be confident about a uniform customer experience. Take for example, the following situation.
On shopping for merchandise worth Rs 10,000, Kritika receives an attractive offer of 20% off on her next purchase, conveyed through SMS the very next day. As a regular customer of this retail outlet, Kritika is quite excited about the offer. This prompts her very good friend Ashi to go shopping for the same amount. Unfortunately, this mass offer was not rolled out to her and this was not the first time. In this case the high intent customer who is a rightful candidate to get a discount has just missed receiving the brand message on this limited period offer but the enterprise had no clue about it. Ashi feels that she should switch to another retail outlet.
Scope for future losses
Lack of transparency can cause losses to an extent that may not be identified. For example, false positive SMS deliveries can be misleading and can throw up wrong insights adding up to a completely flawed business view. Insights based on wrong assumptions can only mean that the business ends up directing its efforts in the wrong direction. Not just that, if it is a case of fake DLRs, the enterprise will end up paying for even those SMS that were not even sent to the end user.
How can enterprises achieve transparency in SMS delivery?
Much before enterprises realized the menace of unreliable message delivery, Sinch stepped in with a pioneer product, Sinch Trust. It gives enterprises a chance to evaluate all their partners fairly. Businesses can now:
Keep messaging transparent: Get actionable insights into SMS delivery reports
Identify trusted messaging partners: Drive business goals with the right partner!
Maximize ROI: Turn lost opportunity costs into potential gains
Wondering how?
Sinch Trust enables enterprises to access Trust scores that helps them to track the SLA. Scores are calculated based on how many messages were actually delivered to the device and how many failed. The resultant score, expressed in percentage gives a comprehensive picture to the enterprise. Trust scores can be calculated for both bulk campaigns as well as transactional traffic. Trust scores of less than 90% indicate that some of the positive delivery reports may be misleading and that the customer has not received the SMS.
Trust scores in the yellow range, that is between 90-95% indicates that the messaging partner is somewhat reliable. A score of 95% and above means that your messaging partner has rightly projected the delivery reports. Basis the score, an enterprise can choose to be in complete control of the messaging ecosystem, improving customer experience by a significant measure.
This helps you:
- Track vendor delivery: Configure your vendors and capture their delivery status for specific messages
- Compare against actual message status: Validate the vendor delivery reports against the actual delivery status for specific messages
- Check trust score: Analyze and identify the most transparent and trusted vendor
CPaaS players also have a major role to play. They must ensure that they have the best infrastructure to land the SMS in the inbox of the intended recipient. There are far-reaching implications of an SMS non-delivery.
Enterprises, when a high-intent customer does not receive your crucial message, hence is not nudged at the right time turning it into a lost opportunity cost for your business. Let that not be your enterprise story!
Have questions or need a demo? Contact us.