THE SMSMODE© BLOG

How to calculate the conversion rate of an SMS campaign?

4 November 2021

The conversion rate of your SMS campaign is perhaps the most important performance indicator. It allows you to calculate the return on investment of your campaigns, the cost per purchase/customer, but also to determine if your marketing is in line with your objectives. Furthermore, the conversion rate allows you to improve your communication, campaign after campaign, and to have a clear vision of the results of your marketing efforts.

sms conversion rate

What is the conversion rate?

Sometimes called the conversion rate, the conversion rate is the number of targets achieved divided by the number of contacts who received a message during your campaign. It is therefore expressed as a percentage (multiplying the result by 100).

The first objective is usually sales, but downloading a PDF can also be one, as can filling in a contact form.

Let's take a concrete example: you have carried out an SMS campaign to encourage your contact base to buy a product with a promotional code. You have sent 1000 SMS and 100 of your contacts have bought the product using this promotional code: the conversion rate of your campaign is 10%. (100/1000 = 0.10 then 0.10×100 = 10)

Why calculate the conversion rate?

It is an essential element for optimising the cost of your communication. In addition, in conjunction with other key performance indicators (KPIs), the conversion rate can enable you to improve your communication, to strengthen your hooks, to refine the way you segment your contact base and therefore, ultimately, to increase your turnover.

How do I know if my SMS campaign has generated conversion?

As a SaaS platform for sending SMS, smsmode©️ provides a significant amount of data (reception rates, sending errors, responses, unsubscriptions...). But unlike a website, the SMS itself does not allow a tracking of your prospects from the reception of the message to the purchase action. It can therefore seem complicated to calculate the conversion rate of an SMS campaign.

However, there are a number of techniques to find out if your SMS campaign has been successful, and there is no need to track your customers' every move to do so. Here are a few scenarios to put in place to evaluate the conversion rate of a campaign:

Evaluate the conversion rate of an SMS campaign for an e-commerce site

  • Implementinga promo code: integrate a code into your marketing message. If it is only available in your SMS, you will get instant feedback on the overall conversion of a campaign: every purchase made with the code is a conversion caused by your campaign.
  • Integration of a link to a dedicated page or a tracking URL: the link can lead to a landing page created for this purpose or contain tracking options (source, support, etc.). From this entry point, you can track the behaviour of your customers in a classic way, up to a potential conversion.
  • Use RCS, the new conversion accelerator channel: this new type of message has a double advantage. First, the addition of carousels, buttons, and clickable images/links gives you the ability to track the customer journey like a tracking URL. Secondly, these new features make your offer more attractive, both aesthetically and in terms of the fluidity of the process. A real reinvention of the customer experience.

For a physical shop

The promo code: this method works for both e-commerce and offline retailers. The codes presented at the checkout by your customers are conversion targets achieved by your campaign.

The incentive text message: on the same principle as the promotional code, encourage your customers to present a text message at the checkout to benefit from a discount. You can then compare the number of text messages sent to the number of discounts granted for this reason.

The e-reservation and the landing-page solution: This solution proposed by smsmode©️ to its customers allows you to benefit from the attributes of a website without having to create one. With the landing-page solution, you will be able to integrate e-booking as well as maps, buttons and contact forms. Choose the objectives to achieve, you can calculate your conversion rate at the end of the campaign.

What is a good conversion rate?

Of course, there are as many good conversion rates as there are types of objective to be achieved.

If your objective is to download a document, sign up for a newsletter or create an account, your conversion rate will necessarily be higher than that associated with a sales objective.

In the mailing world, 4% is considered a good average. For a white paper download, you can expect a double digit conversion rate. If your goal is to sell a product with a high price tag, a rate of around 1% may be quite satisfactory.

In general, the conversion rate of an SMS campaign is 2 to 3 times higher than that of an email campaign. As for the RCS (SMS 2.0) rate, it breaks all records!

sms marketing figures

SMS: the conversion champion channel

Marketing Charts has carried out a comparative study of the conversion rates of the different acquisition channels (note that clicking on a link can also be an objective, and this is surely one of the most achievable, with an average of 30%).

In this study, the average conversion rate of SMS marketing is 29%.

Measured against similar objectives, the conversion rate of SMS is much higher than that of other digital marketing channels:

  • 3.26% for email marketing
  • 3.17% for Google ads
  • 9.21% for Facebook ads

How to improve the conversion rate of your SMS campaigns

Personalise your message

You probably know that personalisation is important. A Marketing Charts study found that visitors who viewed three pages of personalised content had twice the conversion rate (3.4%) than those who viewed two pages (1.7%).

While personalising web content and landing pages can be complicated, sending a personalised SMS is child's play. You can address your customers by their first name, or by their title if you operate in B2B. With smsmode©️ and the mailing option, everything is customizable!

Include a clear call to action (CTA)

Traditional SMS messages only offer you 160 characters, so you need to communicate clearly with your prospects. The call to action should be immediately visible to your recipient. Remember that only the first few words of a text message are visible before the SMS is opened. It is therefore essential to communicate the subject of the text in the first sentence. Otherwise, you risk a potential deletion without even having been read.

Use A/B tests for SMS

This is a well-known technique for sales pages to determine which advertisement or text has generated the most responses.

You can do this with your SMS campaigns: test several catchphrases, different products, several objectives...

You can then keep what works best, or even create marketing automation scenarios or a conversion tunnel, where achieving one goal leads to another goal, with the end result being a purchase.

Conclusion

The days when advertising was limited to billboards, newspaper ads or TV spots are long gone. Marketing is an important budget for most companies and it is normal to want to know how much, precisely, your marketing campaign has brought in. Calculating the conversion rate of your SMS campaigns will allow you to know your return on investment, but also to realise that SMS is one of the best channels to convert.

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