SMS marketing is a powerful tool for businesses looking to connect with their customers more personally and efficiently. With the ability to reach customers on their mobile phones, SMS marketing offers a variety of benefits, including increased sales and customer satisfaction. However, businesses must track specific key metrics to truly measure the effectiveness of SMS marketing campaigns. 

This article will discuss the most critical metrics for measuring the effectiveness of SMS marketing campaigns, including open rate, click-through rate, conversion rate, bounce rate, opt-out rate, delivery rate, engagement rate, and return on investment (ROI). By understanding these metrics and how to track them, businesses can make data-driven decisions and optimize their SMS marketing campaigns for maximum impact.

1) Open rate

This metric represents the proportion of recipients who have opened and viewed the SMS message. A high open rate indicates that the message is relevant and engaging to the recipients. A reasonable open rate for SMS marketing campaigns is considered to be anything above 30-40%. For example, SMS campaigns for appointment reminders or notifications may have open rates as high as 80-90%, while SMS campaigns for promotional offers may have open rates around 20-30%. It is essential to compare open rates across different campaigns and segments to identify which messages are more engaging and relevant for a certain audience.

2) Click-through rate (CTR)

This is the percentage of recipients who click on a link in the SMS message. A high CTR indicates that the message is compelling and that the call to action is effective. A high CTR is considered to be anything over 5-10%. For example, promotional offers may have a CTR of around 2-5%, while SMS campaigns with a strong call-to-action (CTA) and a clear message may have CTR above 10%. It's also important to consider that the CTR will depend on the number of recipients who opened the message, so a message with a good open rate may not necessarily have a good CTR.

3) Conversion rate

This metric is the proportion of recipients who have taken a specific action, like making a purchase or subscribing to a service, following the receipt of the SMS message. A high conversion rate indicates that the SMS message effectively drives sales or conversions. A high conversion rate for SMS marketing campaigns is considered to be above 1-2%. 

4) Bounce rate

These are the SMS messages that are not delivered to the intended recipients. A high bounce rate may indicate a problem with the recipient's phone number, such as an invalid or disconnected number, or the message is marked as spam. A bounce rate of 2-3% or higher could indicate a problem with the phone numbers on your list, such as invalid or disconnected numbers, or that the carrier is blocking the message. A high bounce rate may also indicate that the message is not well-targeted or that the recipients are not interested in the message. 

5) Opt-out rate

This is the percentage of recipients who unsubscribe from your SMS campaign. A high opt-out rate may indicate that the message is not relevant or is being sent too frequently. A high opt-out rate is considered to be anything above 2-3%. However, it's important to note that opt-out rates above 1-2% can also be regarded as high and could indicate that the message is not relevant, is being sent too frequently, or is not well-targeted. 

6) Delivery rate 

The percentage of SMS messages that are successfully delivered to the intended recipients. A low delivery rate is considered to be anything below 90%. A delivery rate below 90% could indicate a problem with the phone numbers on your list, such as invalid or disconnected numbers, or that the carrier is blocking the message. 

7) Engagement rate

These recipients interact with the SMS message in some way, such as replying or forwarding the message. A high engagement rate indicates that the message is relevant and interesting to the recipients. A good engagement rate for SMS marketing campaigns is anything above 20-30%. Engagement rate is an overall metric that takes into account different aspects of SMS marketing, such as open rate, click-through rate, conversion rate, and opt-out rate. A high engagement rate suggests that the SMS message is effectively reaching and resonating with the target audience. Therefore, it will likely generate positive results such as increased sales and customer satisfaction. 

8) ROI

The return on investment of the SMS marketing campaign is calculated by comparing the cost of the campaign to the revenue generated by it. A positive ROI indicates that the campaign is profitable. For example, if the cost of the SMS marketing campaign is $1000 and it generates $1500 in revenue, the ROI would be 50%. A positive ROI means the campaign was profitable and generated a return on investment for the business.

In conclusion

SMS marketing is a powerful tool for businesses looking to connect with their customers. However, businesses must track certain key metrics to truly measure the effectiveness of SMS marketing campaigns. 

By understanding and tracking metrics important to your businesses, you can make data-driven decisions and optimize your SMS marketing campaigns for maximum impact. 

Monitoring the above metrics regularly, businesses can identify what's working and what's not and make adjustments accordingly. This can help businesses to increase sales, improve customer satisfaction, save marketing dollars, and ultimately achieve their marketing goals.

About Radiance Commerce

Want to drive sales and improve customer satisfaction? Look no further than Radiance Commerce! Our platform offers a wide range of features to help businesses and ecommerce brands drive sales through SMS marketing, including automated responses, abandoned cart, reorder and upsell automation, campaign scheduling, advanced segmentation, and more. 

Additionally, our platform offers integrations with popular ecommerce platforms such as Shopify, Salesforce, and BigCommerce. With Radiance, businesses can turn one-time buyers into repeat purchasers, build strong customer relationships, and optimize their SMS marketing efforts. Try our platform today and start driving sales!