Effectiveness of Short Message Service (SMS) as a Marketing Tool

NOW a day’s mobile phone plays the key role in communication in many countries including Pakistan. It seems like the fifth factor that everyone has to have it. Besides the convenience of usage in anywhere or at any time, the user can also listen to music, play games or surf the internet. Another increasingly popular function is the message services in forms of short message service (SMS).

Marketers now discover a chance to advertise their products via SMS. The marketers hope that this new method, also known as wireless advertisement through SMS, will effectively and efficiently promote their products or services. However, it seems that their strategies of message receivers are quite random and convenience-based. Because of the relatively low cost to advertise via SMS, companies now send their advertisements to the mass market without considering the receivers’ personal details.

96% of people who receive text messages, open them. As a result, most people tend to be irritated and annoyed by these careless marketing tactics. Therefore, the purpose of this study is to investigate Pakistani consumers’ response to SMS ads in order to provide a general guideline on how businesses can utilize these tools more effectively. This paper studies influential factors of the responses on SMS advertisements from Pakistani people. The factors considered are demographics (i.e., age, gender, education, and occupation), brand familiarity, relevant on advertisement, and attitude toward SMS.

SMS marketing is rapidly growing as one of the best tools of marketing across the world. It is one of the best ways to connect with the masses. In SMS marketing, a bulk messaging service is used. It is a service in which a single SMS can be sent to a number of recipients at the same time. It is cheap, simple and extremely cost effective. With the ongoing worldwide recession, competition is increasing and many big organizations are finding new ways to advertise their products and services in a cost effective way.

 

According to Pakistan Telecom  Communication PTA, cellular mobile subscriber till Jun-2012 are 120,151,237. Also there is an huge increase in mobile banking market in Pakistan during 2012.

The variables we selected to measure effectiveness of SMS marketing are attention and reaction and both have significant impact on effectiveness of SMS marketing and we conclude that people want to receive SMS of their interests and with familiar companies and interested product/services and mostly people think SMS advertisement as spam so Advertiser should change the share of mind of customers and customize this in better and effective way. Mobile Advertising, also well-known as wireless advertising promises huge opportunities. Still in an investigational stage, business has small knowledge using this new marketing tool. Cellular phone services suggest company’s influential marketing potential via direct communication through consumers, but small research on this subject exist.

 

Information  services  are  mostly  SMS based  and  have  also  contributed  to  the  increase  in  SMS  traffic.  For  example,  mobile banking  services  in Pakistan are SMS  based  and  completion  of  each financial  transaction  involves  multiple SMS  generation.  The  use  of  SMS  is prevalent among  the mobile  subscribers  in  Pakistan,  therefore, mobile  operators  are designing new services based on SMS usage.

We would accept the stated hypothesis H₁. This means that attention has significance impact on effectiveness of SMS. We would accept the stated hypothesis H₂. This means that reaction has significance impact on effectiveness of SMS. Marketers should try to find a single point that regroups all of the permission threads for ads from different sources so that consumers will not have to repeatedly answer whether or not they desire to give permission for every ad they receive. The revelation of personal information without the customer’s permission is a major concern and can easily harm company image.  Also people think that SMS is an effective medium for advertisement. Our R, R², β are positive and shows the significant impact on effectiveness of SMS.

To request to respondents, marketers must adapt their ads to individual use of text messaging and to areas of interest. Companies that launch an effective SMS advertising campaign should register with cell phone operators or specialized SMS information services to reach the maximum number of consumers. These companies can act as filter for unwelcome SMS ads.

Limitations of the study

We only select Islamabad city as our sample so this limit our study and also time constrains is big limitation appears in our study that we faced.

It could give more appropriate picture when done at larger level with big sample size. Moreover this study only encompasses this sector that also limits its framework so it could be viewed further on bigger level in order to get big and accurate picture. By design, the study is limited in its scope. Whereas the student population is a hub target market for operators and advertisers, additional studies should examine a broader sample both in the Islamabad and other cities.

Implications for Advertisers

Rapidly changing consumer needs, consumer choices, market conditions, and tough completions is raising a big question mark for advertisers. More specifically in SMS advertising where little difference found among the brand is also big challenge for advertisers. Last but not least in today’s competitive era, organizations should move beyond features-and-benefits approach to consumer experiences approach (William, 2006)

Future Research Direction

This study brought a number of directions for future research. For future research it is recommended to test the same model in other cities and cultures to verify the generalization of these findings. Cross comparison of four provinces of Pakistan can also be made by using this model. The same model can be tested in advertising companies to test the effectiveness of SMS advertising as a marketing tool in consumer perspective.

Research conducted by Jamil Ahmed  follow him on Linkedin and Arslan Mazhar follow him on Linkedin. This article is written by Jamil Ahmed Co-Founder at Prepareddevelopment.com and you can contact him through email [email protected]