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02/22/2021

How Text Message Short Codes Help Retailers Boost Sales and Engagement

The easier it is for consumers to do something, the more likely they are to do it. That’s why retailers and other businesses use text message short codes as a powerful tool to engage customers.

Mnemonics, systems for improving and assisting the memory, and code length are two reasons why short codes are easier for consumers to remember than URLs and email addresses. Businesses can opt to use “vanity” numbers, which makes it even simpler for customers to remember a brand name and how to get in touch, all of which helps drive sales.

For example, retailers can choose 5-and 6-digit numbers that map to their brand name. Target uses 827438, which spells “TARGET” on the customer’s phone dial pad. Consumers can simply send a text message to the short code to get information, make a purchase and more.

Those advantages also increase the effectiveness and ROI of other marketing and advertising. For example, adding a short code to a radio or TV commercial, billboard, print ad or web banner makes it easy for consumers to act on those ads as soon as they’re seen. A memorable short code also significantly increases the likelihood that consumers will recall and act on that ad later on.

Some retailers use multiple short codes or keywords: one for banner ads, another for print advertising, a third for TV and so on. Or they use a separate short code for each metro area. Tracking the response to each code or keyword provides insights into each channel’s reach and effectiveness.

Short codes are ideal for engaging consumers who use a smartphone as their primary or only connection to the internet. Today, roughly 20% of American adults are “smartphone-only” internet users, meaning they own a smartphone but don’t have home broadband service, according to Pew Research.

Finally, short codes set the stage for an ongoing relationship. When customers text a short code, they can choose to opt in to receive future messages, such as promos, store openings or when a favorite product is back in stock. This keeps them engaged and helps drive long-term sales.

Unlike B2C email, which often winds up in spam folders or unopened, short codes have a 98% open rate and a conversion rate of 45%. By comparison, only 22% of B2C emails are opened and read.

Kiehl’s is one success story. The cosmetics retailer says that 73% of consumers who signed up for text messages purchased a product within 6 months. Another is Attic, a fashion forward streetwear brand that has reported earning a single month’s revenue in just three days by promoting its Black Friday sales via a new mobile keyword. Lastly, Jack’s Surfboards who invited customers via text message to a special event which resulted in $6,000 worth of sales in just five hours.  

Bottom line: Businesses that embrace short codes text messaging make it easy for consumers to act on a retailer’s advertising and marketing. That helps drive sales that otherwise might not occur if they had to remember or write down an email address or URL. It allows a retailer to know a consumer will see the message, make an impression, then allows the consumer to act on it at a time suitable to them. 

Short codes also open the lines of communication and make it easy for consumers to stay in touch with a retailer, driving loyalty and the potential for even more sales and high customer satisfaction for years to come.

Cliff Holsenbeck is senior director of product management at iconectiv.

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