1. Mobile
engagement:
Why SMS is still
the biggest missed
opportunity
GROUP
OX YGEN

2. Contents
About the author............................................................................................................................................ 4
I just can’t live without my phone............................................................................................................. 6
...and you’re not the only one.................................................................................................................... 8
What is SMS marketing?.............................................................................................................................. 10
Perception versus reality............................................................................................................................. 12
SMS = ROI......................................................................................................................................................... 14
And yet, SMS remains grossly under-utilised....................................................................................... 16
The common misconceptions about SMS marketing........................................................................ 18
Misconception #1 - It’s not trackable.................................................................................... 20
Misconception #2 - It’s not engaging................................................................................... 22
Misconception #3 - It’s too time consuming....................................................................... 24
Misconception #4 - It’s invasive............................................................................................. 26
Misconception #5 - It lacks the ability to segment and personalise............................ 28
Misconception #6 - It’s difficult to integrate with other channels................................. 30
Misconception #7 - It’s just for retail..................................................................................... 34
Misconception #8 - It’s only for small business................................................................. 36
Now is the time to turn on to SMS marketing...................................................................................... 38
End notes.......................................................................................................................................................... 40

3. hello.
About the author.
For more than ten years, Mark Grainger has been a key
player in digital marketing in the UK and Ireland, helping
businesses amplify their marketing activities by using the
latest technology. With extensive experience gained in the
marketing services industry,he specialises in SMS marketing
and customer relationship management solutions. He brings
a depth of understanding and logical thinking, in order to
achieve maximum brand penetration, alongside the technical
knowledge to deliver.

4. It is indisputable that we have become attached to our smartphones in a way
that we never have to other technologies. The Smartphone has now become
the essential tool of everyday life. We sit in front of the television and expect
to be able to interact with our programme of choice via social media or text
messaging. We search, shop and pay using a handset which, as little as 20
years ago, was restricted to making phone calls and sending SMS messages.
What’s more, we expect to be connected constantly, and want WIFI available
wherever we are, at home, in a shopping centre, or even on the beach.
Consumers use emotional language to describe their relationship with their smartphones, such as
“I just can’t live without it” or the new smartphone is “life-changing”. Hyperbole? Perhaps, but it is
undeniable that the smartphone offers marketers an alternative channel to acquire, engage and
convert consumers, which is highly effective.
“Mobile text messaging, the first 160-character dispatches
first popularised by nimble-fingered teenagers, may be
the closest thing in the information-overloaded digital
marketing world to a guaranteed read.”
Steve Olenski
Forbes magazine11
I just can’t live without my phone
6

5. There are
6.8 billion
people on the planet and
5.1 billionof them own a cell phone2
...and you’re not the only one
of UK adults have a mobile
phone – up from
50% in 2000
3
of Australians have purchased
clothing or other fashion
accessories via mobile phone4
of the South African population
is expected to have a mobile
phone by 20195
Ireland officially has more
mobile phones than people
with 1.185 phones for every
man, woman and child6
If you lose your wallet, it will
take you circa 26 hours to
report it and get your cards
cancelled – if you lose your
mobile phone the average
response time is 68 minutes7
68% of smartphone
users check their
phones once an hour8
70% of all mobile searches
result in action within
one hour9
50.3% of e-commerce
comes from mobile
devices.10
93% 25% 76%

6. What is SMS marketing?
Let’s start at the beginning, by defining what SMS marketing is
and, more importantly, what it isn’t. SMS is a text message sent to a
mobile phone. Within marketing, it affords the seller the opportunity
of making an offer to potentially large groups of customers, quickly
and easily.
Crucially, SMS marketing is permission-based, which means that each text recipient
must have given permission, in advance, that they wish to receive messages from a
specific company. Permissions are derived from data collection, which can be a simple
text, email opt-in or opt-out capability or web entry.
10

7. Perception versus reality
Two decades ago the only form of mobile messaging was SMS, a pragmatic
mobile data service which had broad reach, standardisation and carrier
interoperability.
Unfortunately, in the minds of many marketers, little has changed. For too many marketers SMS
remains a blunt instrument, characterised as a splurge of unwanted texts that pester and harass
people, and, even worse, have the potential to land you in trouble with the information authorities.
Others regard it primarily as a retail channel, which is incapable of being utilised in other sectors.
The reality is that SMS is now the consumer’s chosen mode of communication.
Our own research at Oxygen8 has demonstrated that SMS messaging is the most popular mobile
service, outstripping browsing email, photography and social media.
What’s more, messaging capabilities have expanded and are now capable of delivering a variety of
content, from video through to redeemable coupons and beyond, which is immediate, contextual,
and serves customers right in their moment of need. Consider these following statistics:
The open rate of
SMS is
Purchasing as a result
of a relevant SMS
Consumers that
prefer SMS to
using apps
SMS that are read
within three minutes
Average response
time for a SMS
Consumers that think
more businesses
should use SMS
98%
90%
64%
90seconds
81%
64%
12
15
13
16
14
17
12

8. SMS = ROI
However, that that isn’t the only perceived problem. The big issue for SMS
marketing cheerleaders is that marketers continue to place more faith in
other mobile channels, such as email, search and app development, which
do not have the proven ROI that SMS marketing enjoys.
Consider the following
of apps are only get used once
of global consumers agree that they should
uninstall apps on their phones due to lack
of use
of consumers will wait five seconds for a
web page to load on their mobile device
before abandoning the site
of customers are more likely to purchase
when mobile offers are part of a
multi-channel campaign
18
The open rate for email marketing is 22%
19
21
20
22
99%
74%
68%
43%
14

9. And yet, SMS remains grossly
under-utilised
However, there is a paradox at work here. Despite impressive statistics both
for smartphone usage and SMS marketing’s ability to deliver to the bottom
line, it remains under-utilised as part of the mobile marketing mix.
All the statistics suggest that mobile marketing, encompassing search, email and social media and
SMS, is growing.
A recent study of multi-channel marketing budgets identified that mobile accounts for 12% of
marketing spend23
, which means that SMS is only a fraction of the marketing budget and a tiny
fraction of the mobile budget.
What’s more, a StrongView study indicated that mobile marketing budgets are increasing, but
marketers continue to place more faith in email marketing and social media.
The “2015 Marketing Trends Survey”24
demonstrated that over 40% of marketers expected to put
more budget into mobile marketing in the coming year, but nearly 49% expected to increase their
social media budgets, and over 60% were putting more money into email.
So, we have a situation where the consumer is all but unable to function without his or her
smartphone, and there is a proven track record for SMS marketing. And yet, more marketing budget
continues to be put into a tactic which gets less than a quarter of SMS’s success in terms of open
rate, namely email marketing.
Something, somewhere is wrong, which brings us to popular misconceptions about SMS marketing.
16

10. The common misconceptions about
SMS marketing
It’s clear that, with its ability to engage and convert consumers, SMS is
chronically under-used as part of the mobile marketing mix, particularly
in comparison to email and app development. Too many misconceptions
continue to exist which deter marketers from utilising an effective and proven
channel. So, let’s tackle some of these misconceptions one by one.
18

11. Misconception #1
It’s not trackable
In the era of payback, ROI and measurability, trackability is everything,
but too many marketers continue to believe that SMS marketing offers no
metrics on which to base success or failure. This may have been true in the
past but it’s not today. Most SMS marketing service providers have the ability
to intelligently track the success of your campaigns and should, at the very
least, be able to gauge campaigns based on five key metrics:
1 Response rates i.e. how many texts elicited a response of a text or code
2 Offers used i.e. when a customer takes advantage of an offer or coupon
3 Call tracking i.e. the number of customers who called a number for more information
4 Click tracking i.e. clicks through to a website from a URL-shortening link, such as bit.ly
5 Text marketing short-codes and keywords, which can be used as a call-to-action and a tracking
method for all forms of campaign activity.
Email marketing
Social media
Mobile marketing
Search (SEO/PPC)
Online diaplay advertising
Tradeshows events
Direct mail
Public relations
Print advertising
Radio/TV advertising
Other
40.2%
38.3%
37.4%
18.0%
16.9%
16.7%
11.8%
7.7%
8.2%
Data Source : StrongView
23.4%
17.8%
33.2%
5.9%
22.3%
16.8%
8.0%
5.9%
1.3%
5.1%
4.3%
48.9%
60.7%
Email marketing
Social media
Mobile marketing
Search (SEO/PPC)
Online diaplay advertising
Tradeshows events
Direct mail
Public relations
Print advertising
Radio/TV advertising
Other
% decreasing spend % increasing spend
Marketing spending plan for 2015, by program
Based on a survey of 377 global business leaders, almost three-quarters of whom are with
companies headquartered in North America
December 2015
20

12. Misconception #2
It’s not engaging
Another common fallacy. Of course SMS is engaging, it’s engaging
because consumers have opted-in to receive the messages. They
have made a conscious decision to give brands their personal
mobile details which offers the opportunity to market directly to a
captive, and loyal, target audience that is already ‘warmed-up’.
What’s more, advancements in SMS functionality means it’s even easier for your
customers to engage in two-way mobile communications that include branded pictures,
videos, and audio with HTML5 pages embedded via a URL within the body of the SMS.
And how does this fit into the customer lifecycle? Well, however best suits you. It is easy
to add mobile tickets, alerts and coupons to transactional messages, or even follow up
with surveys to glean valuable customer intelligence.
22

13. “If your plans don’t include mobile, your plans
are not finished.”
Wendy Clark,
President Sparkling Brands and Strategic Marketing at Coca Cola
Misconception #3
It’s too time consuming
Now, we really do need to spear this one. In today’s busy lives people want
short, sharp and to-the-point messages. Nobody has the time, patience or
attention span to read long novels of communication. However, a short text
message comes in the perfectly compact format that customers are familiar
with and prefer. Modern SMS campaigns, particularly those using a cloud-
based platform, can be set-up very quickly. SMS marketing can be integrated
into nearly all software platforms, including marketing automation, CRM and
EPoS, which means that getting an SMS campaign up and running is extra
quick and easy.
In terms of designing the campaign, marketers just need to switch on their laptops. It is easy to
design, edit, schedule and create optimised landing pages in minutes. Mobile forms can also be
easily created which collect information and build the database. With only 160 characters to work
with (although it is possible to increase this number using multi-part, concatenated messages) it
almost always takes longer to decide the message than it does to set up the software.
24

14. Misconception #4
It’s invasive
SMS marketing is not invasive, at least not if it’s used responsibly. It’s
important that you partner with a supplier that lives and breathes best
practice, avoiding any violation of your customers’ right to privacy.
Most importantly it is vital that you gain permission from the people you plan to engage by
employing a clear, unambiguous opt-in procedure, because gaining permission saves time and
money. It is a method of qualifying your leads or customers. Each message costs money so this
method of qualifying leads ensures that the consumer wants to receive messages, and avoids any
waste of the budget.
What’s more, sending unsolicited messages creates a negative impression of your business
prompting subscribers to avoid the service and file complaints on more public channels, such as
social media and forums, which will negatively impact brand reputation.
Top Ten Rules for
SMS marketing
Top Ten Rules for
SMS marketing
1 Respect your customers’ right to privacy
2 Only message those who have given you permission to contact
3 Allow customers to opt out quickly and easily if they want to
4 Be upfront about who you are and never hide your identity
5
Only send messages during your business hours –
if you are closed don’t message
6 Never purchase lists of numbers
7 Only send texts which are relevant and offer real value to your customers
8 Avoid overt sales messages and marketing jargon
9 Use video and images where possible to improve customer interaction
10 Remember: less is more, don’t over-use SMS
26

15. Misconception #5
It lacks the ability to segment and personalise
SMS marketing is often unfairly labelled as mass marketing. This label is
entirely false. With the right platform, marketers have the opportunity to
highly segment their messages to a handful of customers, or send thousands
of SMS messages to an entire list.
Without segmentation you risk intrusion, but it is only available when the CRM database is tightly
integrated into the SMS platform. Once this has been achieved, it is possible to extract predictive,
behavioural and factual information on each number, which can then be used to profile, predict and
analyse consumer behaviours, in order to deliver targeted and personal messaging campaigns to
your customers – ultimately driving them to mobile sites via trackable in-message URLs.
At the very least I would recommend segmentation by product-lines purchased, demographics,
sales history and VIP clients, who can be targeted with exclusive loyalty programmes. But,
the potential for segmentation is enormous, with everything from geography through to
psychographics, in other words, activities and interests.
“Target marketing … recognises the diversity of customers
and does not try to please all of them with the same
offering. The first step in target marketing is to identify
different market segments and their needs.”
Screen Magic blog25
28

16. Misconception #6
It’s difficult to integrate with other channels
A misconception that is fundamentally wrong.
Application Programme Interfaces (APIs) have the ability to seamlessly connect SMS with other
channels and databases, allowing marketers to deliver multi-channel campaigns. The ability to
deliver mobile messages, mobile vouchers and tickets, and combine online landing pages and
mobile payments, all opens up a world of on-the-go opportunities for creative marketers to sell
their products.
With the massive uptake of PayPal and the rising trend towards mobile payments, M-Commerce
and mobile tickets, mobile messaging gives you the unique ability to target your customers in a
highly effective, responsive and cost effective method to encourage impulse purchases, cross-sell
purchases, and drive loyalty incentive take-up.
Mobile surveys are easy to build and have much higher response rates than other mediums. Send
them by text and you get the opportunity to thank your customers for their feedback whilst gaining
repeat bookings by replying with exclusive offers. Integrated into your existing systems, collecting
customer satisfaction feedback has never been easier.
“It’s great having Oxygen8 as a partner, the multi-channel
technology solutions mean we can easily add further
functionality to our existing systems with the use of APIs as
we grow our business.”
Tim Rooney
Commercial Director, Experian Consumer Information Services
“Mobile is becoming not only the new
digital hub, but also the bridge to the
physical world. That’s why mobile
will affect more than just your digital
operations - it will transform your
entire business”
Thomas Husson
Vice President and Principal Analyst at Forrester Research
30

17. User receives
confirmation SMS
Payment
success
Item added to
basket to pay
Payment failed
Option
Option
Oxygen8
call connect
SMS sent
to user
User views
HTML5 built with
MSISDN tracking
Payment
success
Payment
success
PCI - Automated
IVR payment
PCI - Call centre
representative takes
payment
Fully automated
IVR
1
2
Crucial customer
information pulled
User receives
confirmation SMS
User receives
confirmation SMS
3332
Take this for example…
This graphic illustrates how multiple technologies interact with each
other, passing important information securely, within a fraction of a
second, through the use of powerful APIs. It’s actually a very simple
organisations are losing revenue because they haven’t integrated the
right technology to streamline transactional processes.
Our clients have reported several benefits, such as automatically
recovering lost revenue, an improved customer experience, reduction
the operational costs of call centres, diminished human error… Oh and
it’s all PCI compliant.

18. Misconception #7
It’s just for retail
Well, it’s certainly true that retail has been at the forefront of SMS marketing,
but that does not mean it is solely a retail channel.
If you’re a doctor, dentist, lawyer, consultant, or
anyone who makes appointments (and relies
upon people showing up to those appointments)
text message reminders are an excellent way to
increase your appointment conversion rates.
Recent Forrester research26
suggests that the
financial, utilities, logistics, and food and drink
sectors, are all embracing SMS marketing as
a way of acquiring, engaging and converting
customers.
In fact, it would be no exaggeration to say that
the financial sector is almost prolific in its use of
SMS, with three quarters of customers having
received some sort of SMS contact, in regards
to service reminders, ID and order confirmation.
What’s more, consumers appear to understand
that there are no data security implications, with
78% declaring that their financial institution cares
about the security of their information
of confirming PIN numbers and passwords,
according to Loudhouse SAP research27
.
With online retail going from strength to
strength, the logistics sector has also been
quick to utilise SMS. Customers, unwilling to wait
around the house all day for deliveries, can
receive text messages giving them a precise
time. In fact, according to Loudhouse SAP
research, 83% of logistics customers say that
the use of SMS makes them feel as if “they care
about my delivery / parcel”28
.
Similarly, in the transport sector, be it train, plane
or bus, SMS has the ability to get a customer’s
attention and relay vital information, from a
change in flight times to delays for a bus, which
can keep customers informed and, crucially,
happy.
Surveys are another way for companies to
interact with their customers. Using intelligent
interactive SMS software, customers can be
surveyed around their intentions, attitudes, and
overall satisfaction at key times during the year.
Oxygen8 is currently using the survey builder
functionality to deliver SMS surveys
for a number of clients.
Depending on the response to each question
questions. Typically these are between 4 and
5 questions long (there can be more if deemed
practical) with a “yes/no” or “rank on scale of
1-5” type response, along with the inclusion of
qualitative questions.
“We wanted to let the customer know exactly
where their parcel was and when it would be
delivered. We handle more than 200 million
collections and deliveries each year and we
wanted to start engaging more with the consumer
directly to grow brand recognition.”
Mark Pettit
Director of Sales and Marketing at Hermes
35

19. Misconception #8
It’s only for small business
SMS marketing is for all business not just small business. Certainly,
small business has been quick on the uptake, but bigger businesses and
organisations have followed suit and are leveraging the power of
SMS marketing.
Our own experience is that, over the past year, some of the world’s largest companies have been
won over by the potential for SMS in their own sectors for reliable, secure and interactive two-way
global messaging.
Why is this? Because businesses want to leverage SMS to optimise business operations and
enhance relationships with customers and employees worldwide.
Purchase tracking, alerts and notifications, as well as monetary transactions via SMS, are all high
value and important aspects of a service or overall brand.
The key lies in SMS’s ability to add value to the customer engagement process ushering them
towards a transaction.
All the evidence suggests that even the simplest of messages which remind, protect and advise
customers, can have enormous benefits.
ExploreExploreAskAsk
BuyBuyUseUse
DiscoverDiscoverEngageEngage
Help existing customers discover new
products.
Alerts customers to products or services
for which they have expressed interest
in knowing availability.
Alert customers to flash sales.
Remind customers to use coupons
or rewards.
Remind customers to take action (e.g.
comply with treatment, take action to
meet a fitness goal).
Help customers get better use of
products (e.g. recharge battery or
replace components).
Remind consumers to replenish
goods or refill prescriptions.
Alert customers to opportunities
unique to loyalty members
near shops.
Link in-store visitors to video or
other rich content with product
information.
Use two-way messaging to
facilitate product decisions.
Communicate fraud alerts.
Reset passwords.
Remind consumers to
make payments or to
attend appointments.
Source : April 14, 2014, “The Customer Life Cycle: A Blueprint For Customer-Obessed Enterprises” Forrester report
Messaging is an effective tool to drive sales and
customer engagement
36

20. Now is the time to turn on to SMS
marketing
The purpose of this paper was to set out clearly and simply the case for SMS
marketing, but, it is worth considering one more big reason why SMS is only
likely to grow further as a marketing channel. The demographics are all in
SMS’s favour.
Consider this: in the 18-24 age group 37% of respondents to the recent Loudhouse SAP survey
checked their handsets every ten minutes compared to only 9% of respondents in the 55-64 year
old age group.
The younger generation will grow older and mature, but I am willing to bet that phone ‘checking’
will not tail off as the smartphone children grow up.
We have created a generation who are equipped with the latest technology and expect to engage
with brands almost constantly; have exceptionally high customer service expectations and are
spontaneous, even fickle, in their purchasing decisions.
The irony is that this generation, in marketing terms, is most engaged and most responsive to
SMS, a technology that is decades older than the smartphone. A further irony is that, on the whole,
marketers have not yet caught onto this phenomenon. SMS marketing remains, all-too-often,
overlooked or given an insufficient slice of the mobile marketing budget.
Done correctly, customers will quickly and easily opt into an email list and organisations, across a
wide variety of sectors, not just retail, will be able to supercharge their main drivers, be it traffic to a
website, sales and even brand awareness.
SMS marketing is, truly, the biggest missed opportunity. What’s stopping you?
“Consumers are wholly integrated with
their handsets and interact with brands
on a one-to-one basis via SMS many
times a day. [SMS] is welcomed and
embraced as a communications channel.”
The SMS Advantage
How enterprises can leverage the power of SMS Loudhouse SAP 201430
38

21. End notes
1 Forbes.com “Pulling back the curtain on text message mobile marketing”, March 2013
2 Mobile Marketing Association Asia
3 Mobile Operators Association, Communications Market Report 2013
4 Mastercard Worldwide “2014 Mobile Shopping Survey: Asia Pacific Edition 2015
5 eMarketer 2015
6 ComReg
7 Unisys
8 Loudhouse SAP “The SMS Advantage” 2012
9 Mobile Marketer
10 Shopify
11 Forbes.com “Pulling back the curtain on text message mobile marketing”, March 2013
12 Techipedia
13 IPSOS Observer
14 Loudhouse SAP “The SMS Advantage” 2012
15 Singlepoint “Conversational Advertising”
16 CTIA.org
17 Loudhouse SAP “The SMS Advantage” 2012
18 Techipedia
19 Blackberry
20 Loudhouse SAP “The SMS Advantage” 2012
21 Gomez
22 Responsys
23 Lewis PR, “Multi-channel Marketing: A study highlighting current approaches and investment, opportunities and
key challenges” – July 2nd 2015
24 The StrongView “2015 Marketing Trends Survey”
25 Screen Magic blog, “Market Segregation and SMS Campaigns”, June 2011
26 Forrester research quote needs sourcing
27 Loudhouse SAP “The SMS Advantage” 2012
28 Loudhouse SAP “The SMS Advantage” 2012
29 Forrester Research diagram
30 Loudhouse SAP “The SMS Advantage” 2012
4140
Engage is a cloud-based mobile engagement platform for creating interactive
services and marketing campaigns. With the tools to help you enhance and improve
interactions with your customers, you can fully embrace the power of mobile as a
multi-channel tool, ensuring personal and meaningful engagement every time.
engage
Book a demo today

22. GROUP
OX YGEN
www.oxygen8.com +44 121 621 2000 sales@oxygen8.com
12th Floor, Lyndon House, 58 - 62 Hagley Road, Birmingham, B16 8PE, United Kingdom
Smarter choices = better engagement