Friday, April 03, 2009

Is SMS marketing doomed?

doom the end Well, that’s a question I was asked recently. The marketer who asked me feared that SMS marketing could go the same way as email marketing, which in his opinion, is ruined and he wondered how or even if we could stop that from happening and whether or not any industry initiatives held any weight.

Many would argue that email marketing isn't broken - it makes money, can be useful and is now a well-honed, scientific activity. There are plenty email companies out there doing very nicely thank you. And there are even a few of them who take our privacy and customer experience seriously. Personally, email marketing is broken for me. I’m overwhelmed by email (I always have a backlog of emails to read and I don’t get round to answering them all despite best intentions, there simply aren’t enough hours in the day). And I still get junk email to made up email addresses based on my domain names which I find particularly distasteful. That said, I still sign up to email newsletters and from time to time there are some things I respond to. But it’s all a bit random and I really could do without the volume. The same goes for direct mail and direct marketing. It doesn’t work for me. I’m completely overwhelmed by direct mail, both business and personal, and despite being on the Mailing Preference Service’s 'Do not mail’ list, it still keeps coming. I’m also on the Telephone Preference Service list although, you’d never know as I still get a ton of unwanted marketing calls.

But those direct marketing channels still work as most people are not like me. Or the chap I was talking to about this. Not everyone is overwhelmed with paper or digital communications. Different people have different needs and we are most definitely not all the same. Click through and conversion rates in the very low percentage points are all that’s required for a direct marketing campaign to be successful inasmuch as there’s a return on investment. That fact that 99.9% of your audience didn’t respond is largely irrelevant if the 0.5% responding made you the money. Screwed up, yes, but it still adds up financially.

Coming back to mobile marketing, it is inevitable and unfortunate that mobile advertising and marketing will be and has already been misused. There will always be someone out to make a quick buck, find a loophole and exploit it. Junk SMS does make money too - although the economics and science behind it are more limited than with email due to the cost of sending. But even factoring that in, and factoring in the potential of a fine from Phone Pay Plus, junk SMS persists – I know. I still get the junk SMS messages offering me a hot date, filthy video clips or a dodgy loan. The Mobile Marketing Association initiatives *are* worth supporting and savvy marketers and companies will follow them as the short cuts become less and less appealing.

I co-founded Grumbletext SOSSMS back in 2003 which is a site where you can complain about your junk SMS and it certainly helped raise awareness at the time and is still a place where you can name and shame the offending companies and campaigns. Phone Pay Plus (formerly ICSTIS) is the UK regulator for many issues around junk SMS and does fine companies pretty regularly. However, the fines for some companies are simply a ‘cost of doing business’,but if we didn’t have this, then the landscape would be even worse.

We will never stamp it out completely, there will always be someone who doesn't want to play ball and finds a way around it and who is led by greed and not what customers what, but the industry initiatives are worthwhile supporting because, if nothing else, it raises awareness on a wider scale. There are no easy answers.

I think the real problem around mobile marketing ultimately will be more generic. As we move towards unified messaging (facebook, twitter, SMS, email all coming to the same inbox), we will be overwhelmed by marketing messages yet again so it will be a law of diminishing return as we just switch it all off rather than trying to work out which messages we want.

We actually need less advertising overall not more but in this world where creation of digital media and by association advertising opportunities, is almost infinite and only limited by bandwidth (you can create as many web pages as you like and auto-generate emails, blogs, viral message and in turn, on each page there’s the potential to place an advertisement), that isn't going to happen. Automated filtering might be the way forward. Intelligent systems may help. Some customers may even be prepared to put the effort in to manage all of this to keep it under control. And we might think we’re so clever that by understanding past behaviour we can predict future behaviour (which is a myth by the way - “Past performance is no guarantee of future results” as all financial companies will tell you). Even with all the targeting and relevance in the world it won’t necessarily make our advertising lives any better or easier. Serendipity plays a part too and I’m not clear how much that is or isn’t understood in marcomms circles. I guess that’s one for another post.

We're in a period of fast change, a revolution even, and we do need to keep an eye on the ball as to what the future might hold. We don’t have the answers yet but that shouldn’t stop us from trying to work them out.

Image courtesy of sirmikester used under Creative Commons Licence.

Update 3pm 3 April 09: Paul Berney from the MMA has written a post about how to harness CRM using mobile marketing and says,

"...the customer experience and the ensuing results for the brand will only be good if the channel is not abused in the same way as email has been in the past. For any mobile marketing message to really resonate with a consumer, they need to have confidence that what they receive is something of interest and use to them. Anything else on this highly personal medium is unacceptable.

Current internet marketing and privacy standards do not adequately address the specific challenges faced by marketers when marketing through the mobile channel. Strong mobile industry privacy principles must protect the mobile channel from abuses by unethical marketers, to limit consumer backlash and additional regulatory scrutiny."

Check out the full article and the links to the relevant MMA guidelines.