Hello, this is the next article in a series of articles on how to measure the return on investment in software development projects.
Companies that do not effectively measure the performance and profitability of their companies do not have an effective way to modify or improve their business model. To take this further, companies should measure the performance of all the different business functions.
In this article, we are very specific on how to effectively measure the exact return of bulk SMS campaigns. Remember that this is only the opinion of the writers, feel free to comment and offer your own suggestions on this, it is about learning and sharing to make the business work better.
A little history first. Most people will agree that SMS has become huge, the technology is simple and most importantly very short, forcing you to get to the point quickly on whatever you are communicating.
That said, however, companies find sending SMS a great benefit when done correctly, the cost-benefit ratio is outstanding. The dilemma is this, most companies that send SMS know it’s worth it because once in a while a customer walks into the store and says they received an SMS, however, how many companies can tell you exactly how much money they make with? who send SMS? Very few right? So how do you do it?
How to measure
We will use the example of retail businesses that offer their customers a combination of services and products.
Step 1: Your existing customers are like gold, make sure you know as much about them as they will let you know, at the very least ask each customer for their cell number and name, with that you can send a completely personalized SMS to that person and make it look like that you wrote it yourself. You can create a sales profile on that customer, buying pattern, etc.
Step 2: Decide what type of campaign you want to send to customers. Make sure that every SMS that is sent to a customer has an offer/discount or something that ensures that your customers are always excited to receive SMS from your business. Informational or advertisement type SMS is never a good idea, it can irritate your customer and possibly lose a customer or the customer will ask you to stop sending them SMS. In other words, my suggestion is that if you’re going to send out a campaign, give something away, say, 10% off a specific service for a week to customers you know are interested in that service, come find a gift because it’s his birthday. early. However, the point here is that an SMS campaign that is giving something back to a customer will always perform much better than a campaign that is just providing information. Experience has also shown that the cost of offering something is cheaper than offering nothing when comparing the average value of sales and the number of purchases made. Sometimes it is necessary to give something back to the customer to get more from him. Think of the line of that customer talking to someone else talking to someone else, etc. That’s just one of the many benefits of giving something back to the customer.
Step 3: Add a unique code to each SMS and indicate that the person must give the code to redeem the 10%, gift, etc. Now you know where I’m going with this, but you’re already saying that people won’t come to the store and present the number. I agree and disagree with this statement, the reality of adding a say 5 digit code to the end of an SMS means that the customer now needs to take an action and this can be seen as a negative, however remember that the goal is to measure exactly how many people return as a result of the SMS, the interested customers who receive the SMS will come to your store and show the code if they are really interested in what you are returning. You will also get those customers who come to the store and say that they received an SMS, a good system will allow you to take the mobile number of that customer and verify if they received the sms and therefore receive the code.
Step 4: Your point of sale software program should have a built-in part that allows you to enter SMS codes into the system, this is then verified against that customer’s mobile number, and more importantly, have your program automatically deliver that gift (product service code), the discount on the product or service, etc. automatically. The customer will then see that this SMS code actually helps to get what is being given to them very quickly, thus making the customer more receptive to the same campaigns in the future. More importantly though, your program will have recorded that a discount or item was given as a result of an SMS code, oh and did I mention that anything else purchased on that invoice can also be safely directly attributed to that SMS! Why? Well, this is the impulse buying syndrome that many people exhibit, now you not only get the customer to come back to your store, but they also bought additional items and services as a result of your campaign to give them something. Yes, there will be customers who are not, but experience has clearly shown that customers will more often than not buy more of what you offer. Better yet, if you have a good sales team, they will promote products or services that complement the discounted product or service purchased by the customer due to sending SMS. This means that you are actually using SMS to promote a product line to the customer by offering a discount on one of those products, you could also have negotiated a lower cost price with your suppliers for the product, so it would not really affect your product profitability.
Step 5: Finally, your software program must have a specific report that is based on a date range and/or an SMS campaign that shows the ROI on SMS campaigns, this is not such a complex report, the cost price is made up of:
– the cost of the SMS campaign as a whole – the cost price of all the elements of the invoices attributed to the campaign
The sales portion is simply the sales price (ie, the actual sales price minus the discount if that is the discount) of all items on all invoices for that SMS campaign.
The report then subtracts the sales from the cost of sales to give the campaign profit and then displays a simple ROI percentage.
That’s it, you now have a way to provide an exact way to track the exact return of SMS campaigns, however, it is important to have software that can offer these capabilities. Most customers (companies) find that the success rate of customers responding to the number of SMS sent is probably less than 10%, but that the return and profitability of the campaign far exceeds what it seems to be. few people return to his campaign. Remember that you don’t need a large number of responders to make a good profit, in most cases it only takes 2-3 returning customers to accept your offer. 10% of 10,000 returning customers is a huge win for any business, considering it took a well thought out SMS and 5 minutes to send 10,000 SMS to customers, that’s probably the best money you could have spent on marketing.
Also remember that a report showing the ROI on an SMS campaign will greatly help you to be even more effective with SMS campaigns, i.e. what time of the month has a better return, what season, time of day, what type of discounts customers like best, etc. , all these business decisions can be made very easily with a report like this in front of your eyes.
One final note: If you find that your success rate is too low for your liking, your campaign is likely to be a bit general, instead of sending more targeted campaigns to even more targeted customers, that will definitely drive your percentages up, if that doesn’t work. then perhaps the problem lies in the service you offer customers, great service always keeps customers coming back. I’ve had clients who had almost no return on SMS campaigns and they sent the same SMS campaign that other clients had sent with great success, without telling them, however, it was clear that they simply weren’t offering their clients a good service in any way. way. case, so no amount of SMS and discounts was going to help them.
I hope this article has helped some people and companies. Comments are always welcome