$3.66 million SMS revenue generated in a few months, 10% of Overall Store Revenue And An average ROI of 8x:

SMS marketing Report 2021

Powered by mastery over email marketing through years of learning, practice, growth and stellar client results, extending to SMS has been a natural progression for Hustler Marketing. Together, email and SMS marketing form the two essential pillars of lifecycle marketing for any ecommerce brand.
With an added push of a timely SMS – which is
short, usually with a pointed call-to-action, and
one which reaches the customer on a device
that’s always with them – it’s proven to
capture their attention, get results and
in the long run, increase your
customers’ lifetime value significantly.

Why SMS is a multi-times ROI-positive channel

Other than being effective for conversions, SMS marketing is highly profitable and achieves an ROI of several times over because of its low costs. It’s also incredibly easy due to its minimal copy and almost no design requirements. With SMS, short is definitely sweet.

Why SMS is even more relevant in the age of “first person data” marketing

Everyone knows email is powerful, but now SMS adds that additional touchpoint in the customer lifecycle. With the new iOS and Facebook changes and with third-party data becoming harder and harder to rely on, the name of the game now is first-party data and ‘owned messaging,’ which email and SMS are the two most important pillars of. It’s a channel brands can turn to in these hard times and test with minimal risk and a high reward.

But don’t take our word for it. We analysed our SMS results for the last year (2021) and they’re pretty great.

SMS revenue as part of the overall revenue

Between the 21 clients, the average revenue from SMS stood at 10% of the total store revenue. Out of the 21, 18 clients have an average SMS revenue share of 18%. The highest SMS revenue was for an adult toy store client at 21.22%. It’s worth noting that most of our SMS clients started their SMS journey in the 2nd half of the year and 1/4th of them started only in Q4.

Average SMS revenue share for:

Revenue breakup between flows and campaigns

SMS flows netted the bulk of the SMS revenue at 80% and remaining 20% was done by campaigns. This is normal and for SMS, flows like the Welcome Flow and the Cart Abandoned Flow perform great, earning even upto 50% of the SMS revenue between the two. The flows also scored a higher share because most stores tend to send more flow SMSes than campaign ones.

SMS Revenue

ROI for the clients

As mentioned earlier, SMS is an extremely low cost and yet high ROI-driving marketing channel. Being that SMS costs are near marginal (under $0.05/sms) and the only real expenditure on SMS marketing for most stores was our setup fees and a monthly management fees, the resulting revenue from SMS for almost all stores was ROI positive, multiple times over. For the last year, the average ROI for 21 stores was 8x or 800% and it was over 15x for 5 stores and between 10-14.5% for 10 stores.

First 3 month performance for 5 stores

5 of the stores that started their SMS journey in October netted an average of 10.48% of their overall store revenue from SMS in the first month, ramped up to 14% in the second month (Nov) and 14.88% in the 3rd month. (Dec)

BFCM results from SMS alone

The Black Friday Cyber Monday (BFCM) month was a strategic time to invest in SMS for most stores, resulting in a whopping $1.1 million in overall revenue from SMS alone. Here’s when we stepped up to the occasion and set up special BFCM flows, campaigns and landing pages, for all the stores we managed SMS for. While for these stores, revenue from email marketing was 30% of the overall store revenue, from SMS alone, they drove a revenue of 12% ( 11.85%) during BFCM month and 13% during the BFCM main sale days (Thanksgiving, Black Friday, and Cyber Monday respectively.)

Store Revenue

Conclusion: SMS marketing which began as an add on to email marketing is now a formidable marketing channel in its own right. With a 10% average revenue from SMS and growing month on month, not only is SMS effective but also a very ROI-positive marketing channel that no ecommerce store can afford to ignore.