Today no one can afford to build a great campaign without measuring their ROI. Due to the investment and time needed, SMS marketers, need an easy way to find their return on investment, so they can know how much they are really spending.
This article will provide you with a guide on how to measure your SMS campaign ROI.
The delivery rate is usually reported as % of messages sent out. The higher the delivery rate the more efficient in terms of SMS usage you are since it’s related to how many users receive your text message(s). Non-profit SMS campaigns a highly effective as they are seen by large audiences.
Open rates are usually reported as % of total messages delivered. The higher your open rate the more engaged your audience is and the better results you will get.
Interaction rate is a measure of how many subscribers completed an action after opening an SMS from you. This is normally expressed as a percentage of total clicks divided by the total number of messages delivered.
A high interaction rate signifies that subscribers are enthusiastic about the message they have received. It shows that your campaign is relevant to the target audience and that they find value in the information. It also indicates a high level of user loyalty to your company and can make your brand more recognizable.
The response rate is the average number of responses received per message delivered. Response rate is usually expressed as a percentage of total messages sent out. Response rate shows how responsive your audience is towards you, as well as how well you can communicate with them. It also serves as an indication of how effective your campaign is in converting subscribers into customers or leads and vice versa.
Since making a purchase/donation is a very important part of your business, it’s important to know how many subscribers unsubscribed from your list and why. Knowing the reasons behind unsubscribes will help you create better SMS campaigns in the future.
Usually Unsubscribe rate is reported as % of total subscribers, a reduced unsubscribe rate for this campaign compared to previous ones shows that your SMS campaign is improving and increasing user engagement.
Conversion rate is the ratio between how many subscribers/customers were sent to your campaign and how many of them completed an action that you wanted them to.
A high conversion rate means that customers are responding to your messaging, which will contribute to a more active and loyal customer base.
The response ratio is the average number of responses per subscriber. This will give you an idea of how engaged your users are towards your messages. If they are responsive they are more likely to convert into customers. Response ratio is usually expressed as a percentage of total subscribers sent out.
Cost per Sale/Lead/Donation
Cost per sale/lead/donation measures the amount you spent for each customer, lead or donation acquired through your campaign.
The Return on Investment or ROI is really what SMS marketing is all about. It’s your way to know if your campaign is working and to make adjustments as needed. It is the ease in which all of these metrics can be collected that makes SMS marketing so attractive.