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SMS vs Chat Apps: Which Is Right for Your Business?

CTI is pleased to bring you this content, provided by our partners at 8×8.

It’s no secret that most consumers are on their phones throughout the day. Fun fact: the average person checks their phone 160 times a day. It therefore makes sense for businesses to meet customers where they are by using two of the most-used instant messaging services of modern communications: SMS and chat apps.

With this in mind, communications managers who are looking to optimize their strategies might ask themselves, “Which is better: traditional SMS, or chat apps?” Intuitively, most people might favor chat apps that, on the surface, receive more traffic by virtue of being intrinsically connected to the internet. However, a closer look at traditional SMS reveals that there are specific advantages that have kept this tried-and-true communication method relevant to this day.

Why instant messaging is essential

Before we dive into the differences between chat apps and SMS, let us very briefly mention why every communications strategy should include instant messaging (of any sort).

Instant messaging is by far the best marketing channel in this day and age, with open rates that are more than triple those of direct email marketing.

Open rates aside, the nature of instant messaging makes it easy to facilitate two-way communications, so marketers can move beyond awareness and towards engagement and conversion within the shortest possible amount of time.

Traditional SMS vs. chat apps

Now, let’s take a look at the specific features of chat apps and traditional SMS, as well as how to best utilize their features to engage consumers effectively.

Traditional SMSChat Apps
Text onlyRich content (sounds, images, video)
160 character limit640 character limit (Facebook)
Needs: telco networkNeeds: internet

 

At first glance, chat apps seem to have the advantage with larger content and character limits. However, traditional SMS does beat chat apps in terms of accessibility.

The thing is, unless a customer’s SIM card or telco network is not functioning (which rarely happens), they will nearly always be reachable via SMS. The same can not be said for internet networks, which are prone to interruption and have a reach that is limited to urban areas. This makes traditional SMS a lot more reliable when communicating with customers, especially when it comes to time-limited purchase decisions.

Some businesses also utilize SMS notifications as a way to nudge consumers who are on the fence. One common strategy is to send notifications to customers who have abandoned shopping carts. The reminder SMS may be paired with a time-limited discount code to further instill a sense of urgency that can prompt customers to make a purchase.

Such strategies allow you to capture customers who may not have the luxury of connecting their personal devices to the internet, or people on the go who are simply turning off their mobile data to reduce data and battery consumption.

Chat apps: customize your message with rich media

An advantage of chat apps, however, is customization. If you’re looking to send creative messages, you’ll have a lot more audio and visual options to play around with, such as stickers, GIFs, and videos. This also allows you to interact with customers in a more natural, interactive way, which definitely increases engagement.

That being said, do bear in mind that longer, flashier messages are not necessarily better, as some customers might find walls of text or images a nuisance and choose not to engage.

The key is to actually capture the customer’s attention within the first 160 characters—the portion of text that will show up on their lock screens.

Reach: who is reading your messages?

 

Preferences vary by country

Contrary to popular belief, the SMS market is thriving just as much as chat apps. CNBC reported that SMS volume would increase by 40 percent in 2021. In fact, a closer look at the statistics reveals that SMS and chat apps actually compliment each other very nicely by allowing marketers to reach out to disparate demographics.

For example, studies show that text messaging was the most preferred method of communication for US teens during the peak of the pandemic in 2020, while KakaoTalk, Line, and WeChat continued to dominate communications in South Korea, Japan, and China, respectively.

It is therefore important to know the preferred communications channel of the audience you are trying to reach—not all are the same.

Mobile or desktop?

It might surprise you to know that of the 5 billion people who own cell phones, a large percentage of them do not actually have access to the internet. While the majority may still have internet access and can be reached via both SMS and chat apps, it’s important to remember there are times when people wish to, or need to, take a break from their phones.

This has been a big part of the success of WhatsApp’s Desktop feature, which has kept the chat app relevant for businesses with over 8 million business catalogs in India.

Have your cake and eat it too

Be it SMS or chat apps, it is not just the open rate of your communications that matters. Since the average customer responds to direct messages in just 3 minutes, that puts a lot of pressure on customer service providers to respond equally fast, if not faster.

Subsequent follow-ups that can convert leads into sales are critical moments that can truly make or break your business. In a recent CMO council study, customers said that fast response time was the most significant factor to their customer experience, with 93% of them stating that they would be more likely to make repeat purchases for excellent service.

CTI can help connect you to a world of messaging options through our partners at 8×8 and others. If you are interested in enterprise-grade messaging options for your business, please complete the form below and someone will reach out.