SMS KPIs

Defining a KPI

A KPI, or key performance indicator, is a quantified figure that reflects the extent to which an objective has been achieved. These KPIs can vary depending on what you want to measure: the growth of your contact list, the sales generated by your campaigns, the engagement of your customers, etc. KPIs must be SMART, i.e. Specific, Measurable, Attainable, Realistic and Time-bound. For example, a SMART KPI might be: increase the conversion rate of my SMS campaigns by 10% in 6 months.

The importance of KPIs in SMS campaigns

SMS marketing is a highly effective lever for businesses. It's short (160 characters), instantaneous (average reading time 90 seconds) and personal (perceived as a private message). SMS has an opening rate of 98%, a response rate of 45% and a conversion rate of 29% on average. These figures are well above those of other channels such as e-mail, which has an average open rate of 20%, a response rate of 6% and a conversion rate of 3%.

These specificities mean that the choice of indicators must take into account the nature of the SMS and its impact on the customer. Properly determining the indicators to track enables you to evaluate the performance of a campaign and optimize future ones based on customer feedback. They also enable you to improve the benchmark KPI: return on investment (ROI), by comparing the cost of sending SMS messages with the sales generated by the campaign.

Which indicator to choose for SMS marketing?

To determine which indicators to track, you first need to define your marketing objectives. What is the aim of your campaign? Building customer loyalty, encouraging them to buy, informing them, getting them to take part in a competition, etc.? Next, you need to identify the indicators that will enable you to measure the effectiveness of your strategy. For example, if your objective is to build customer loyalty, you can use the retention rate, the reactivity rate or the churn rate.

The 6 main SMS KPIs

What are the main KPIs to track for your SMS campaigns? How do you calculate and interpret them? What factors influence these indicators? Discover the 6 essential SMS KPIs.

 

Delivery rate: 1st performance indicator

The delivery rate is the first indicator to consider. It corresponds to the number of SMS received compared to the number sent. It is calculated as follows:

Delivery rate (%) = (Number of SMS delivered / Number of SMS sent) x 100

The delivery rate is essential, as it reflects the quality of your contact base, the routing capacity of your SMS platform and the availability of the network. If your deliverability is low, it means you're losing part of your audience and wasting resources. A good delivery rate is over 98%.

To improve your delivery rate, you need to :

• Regularly clean up your database, deleting incorrect, inactive or unsubscribed numbers.
• Choose a reliable platform that complies with quality and safety standards, and has direct routes to operators.
• Adapt the content of your SMS messages so that they don't come across as potential SPAM, avoiding overuse of capital letters, special characters or links that are too long.

find out more about SMS delivery rates

Open rate: a measure of initial commitment

The open rate is the percentage of SMS messages opened by recipients in relation to the number of SMS messages delivered:

Open rate (%) = (Number of SMS opened / Number of SMS delivered) x 100

The open rate is a measure of your contacts' initial engagement. It indicates whether your message has aroused interest and curiosity. It is influenced by the relevance of your message, the time and day it was sent, and the sender's name. A good open rate is over 95%.

To improve it, you can :

• Segment your audience, sending personalized messages tailored to your customers' needs, preferences and behaviors.
• Choose the right moment, taking into account the context, seasonality and buying cycle.
• Use a sender name that inspires confidence by being clear and recognizable.

 

The click-through rate (CTR): evaluating the effectiveness of Call-to-Actions

The click-through rate (CTR) represents the proportion of messages that have generated a click on a link, in relation to the number of SMS opened:

Click-through rate (%) = (Number of clicks / Number of SMS opened) x 100

The click-through rate is an evaluation of the effectiveness of your Call-to-Action (CTA). It indicates whether your message has prompted your recipients to take action, by directing them to your website, application, product sheet, form, etc. It depends on the quality of your offer, the clarity of your call-to-action and the trust placed in your message. It depends on the quality of your offer, the clarity of your call to action and the trust placed in your message and URL. A good click-through rate is above 10%.

There are several factors to take into account to improve this rate:

• Propose an attractive offer that adds value and creates a sense of urgency or exclusivity.
• Write a clear, concise call to action, clearly stating what you want your customer to do, and encouraging them to act quickly.
• Use a short, personalized link, adapted to the SMS format, that's easy to read and inspires confidence.

find out more about SMS click-through rates

Conversion rate: the culmination of marketing efforts

The conversion rate measures the percentage of SMS messages that lead to the achievement of the desired objective, such as a purchase, registration, download, etc. It's the culmination of your marketing strategy. It's the culmination of your marketing strategy. It indicates whether your SMS campaign has achieved its objectives and generated sales for your company.

The calculation is as follows:

Conversion rate (%) = (Number of conversions / Number of SMS delivered) x 100

Many factors influence it, such as the added value of your proposition, the ease of the buying process, or the recipient's trust in your brand. A good conversion rate is above 5%. With SMS, it can be very high.

Here are some tips on how to improve it:

• Align your proposal with the customer's needs and expectations with an adapted offer.
• Simplify the conversion process, by reducing the number of steps, optimizing navigation and offering a variety of secure payment methods.
• Reinforce the confidence of your recipients, by providing them with clear, transparent information.

find out more about SMS conversion rates

Churn: understanding audience loss

The unsubscribe rate corresponds to the number of SMS messages that triggered an unsubscribe request in relation to the number of SMS messages delivered:

Churn rate (%) = (Number of churns / Number of SMS delivered) x 100

It's an indicator of customer satisfaction with your marketing. If your mailings are perceived as useful and interesting, it will remain close to zero. On the contrary, if your communications are perceived as intrusive, inappropriate or undesirable, it could soar. A good churn rate is less than 1%.

Some best practices to reduce your churn rate :

• Respect the consent and preferences of your contacts, by asking for their explicit agreement to the sending of SMS messages.
• Make sure your message frequency is correct and/or allow subscribers to choose their own frequency.
• Clearly indicate the unsubscribe procedure, and make it quick and easy.
• Make sure your communications offer a benefit, by rewarding loyalty and soliciting customer opinions or participation.

 

R.O.I.: the king of KPIs

ROI (for Return On Investment) is a way of assessing the profitability of an investment, taking into account the money invested in a campaign and the money earned as a result. It's the most interesting KPI for an entrepreneur, because it lets you know whether an action is profitable, which is the basis for commercial success.

The R.O.I. formula

R.O.I = (revenues - costs) / costs x 100.

SMS ROI is influenced by a number of parameters, such as the place of SMS in your strategy, the quality of your mailing list, the message, the offer and your user experience. The average SMS ROI is over 3000%.

To optimize the ROI of your SMS campaigns:

• Determine all the costs associated with your SMS communication.
• Analyze all SMS KPIs
• Optimize your strategy with the knowledge you gather

find out more about the king of SMS

Analyze and optimize your campaigns with SMS KPIs

Using data is the key to getting better at mobile marketing. To do this effectively, you need to follow a rigorous, iterative process, which breaks down into four steps:

1. Collect data, using the appropriate tools, such as your SMS platform, a CRM, or a web analytics tool.
2. Process data, cleaning it, structuring it and aggregating it to make it usable.
3. Analyze your results to extract relevant information.
4. Act on the data, turning it into recommendations for improving your campaigns.

This process needs to be repeated regularly, to ensure continuous improvement of your campaigns, and to adapt to changes in the market and your customers' needs.

Pitfalls to avoid in interpretation

Interpreting KPIs is not an exact science, and can be subject to error, bias and misunderstanding. To avoid these pitfalls, adopt a critical and objective approach, respecting a few basic principles:

• Don't focus on a single KPI: take into account all the indicators to get a global and coherent vision.
• Compare comparable data: make sure you use the same criteria, methods and sources to avoid distortions and inconsistencies (A/B testing).
• Don't confuse correlation with causation: check whether the observed links between variables are really significant.
• Avoid hasty conclusions: rely on sufficient, reliable and representative data to avoid generalizations and approximations.
• Take into account the context: such as seasonality, competition, or events that can influence the results of your campaigns.

By adhering to these principles, you'll be able to interpret your results more accurately and avoid analysis errors that could harm your performance.

Conclusion

SMS KPIs are important to your success, as they enable you to identify the strengths and weaknesses of your SMS campaign. They enable you to test and validate hypotheses through data-controlled experiments, as well as learn about your customers' journeys, profiles and behavior. With them, you have all the keys to effective, relevant communication. Now all you have to do is exploit their findings for your future SMS campaigns.