With a 99% open rate, it’s a wonder why texting hasn’t become mass-adopted by brands.
Some companies already reach customers via text by offering them discounts and other benefits, but digitally native companies like Brightland, Lively and Trade Coffee Co. are using texting to help customers with their subscriptions, offer them recipes and provide other tips.
Texting gives digitally native brands a chance to get closer to their customer while keeping marketing costs low on other fronts, like paid media. With more than 115 million people in the U.S. expected to buy at least one item on their phone this year, according to eMarketer, reaching customers via text presents an opportunity to either get them to shop or amp up their brand loyalty.
Reaching consumers where their attention lies
It’s not the first time brands are experimenting beyond email and messaging (companies have tried push notifications and Apple’s Business Chat feature), but many are understanding where their consumers live: on their phones. So, by taking a “fish where the fish are” approach, these DTC brands can drive both sales and loyalty in one fell swoop. And as email marketing loses steam for retailers, with only a 19% open rate and 2% clickthrough rate for brands in that space, it’s one way to diversify spend.
Brian Long, CEO and co-founder of mobile messaging company Attentive, works with more than 400 brands, such as Coach and Urban Outfitters, to enable sending texts to customers as well as digging deeper into the funnel by supporting cart abandonment and more. Long said digitally native companies are approaching texting differently from major retailers, forgoing coupons and instead educating customers about the brand.
“Email is much more akin to a standard ad unit that costs no money,” Long said. “Messaging is much more two-way, much more personal.”
Lively, an Attentive customer that was recently acquired by Wacoal Industries for $85 million, began to test texting in January to communicate with customers and as another potential sales channel, said Michelle Cordeiro Grant, Lively CEO. Grant said it almost immediately started earning revenue and is now a multimillion-dollar channel, with text bringing in 16 times more revenue than email.
“It’s such an engaging place if you use it right and don’t abuse it,” Grant said.
Long said for brands, this means understanding that it’s not just “email marketing 2.0” and that it’s a much more personal channel. If customers get annoyed because a brand sends too much or writes the wrong message, they can opt out and might never come back.
Grant added that texting has become an acquisition channel for the brand. It’s also cheaper compared to digital channels like Facebook. For example, texting became the third highest sales channel when Lively let customers know via text that it rolled out a new collaboration with Madewell. Customers reached through texting end up becoming brand-loyal, lifetime customers, Grant said.
Trial and error will help it grow
For Lively, texting is less costly than paid media efforts mainly because the brand hasn’t added any “significant” media dollars behind it, Grant said. She added that texting allows the brand to reach the consumer throughout the entire customer journey versus only at the top of the funnel acquisition.
Brightland, a digitally native olive oil company, started to test texting with its customers in July. The brand’s “texting concierge” is open only once a week (on Fridays) between 9 a.m. and 5 p.m. PT. Currently, the brand handles all texting and encourages existing customers to ask the Brightland team anything related to how to use the olive oil product, what to cook and how to customize subscription orders.
Aishwarya Iyer, founder and CEO of Brightland, declined to share specific numbers around the texting service since it’s only in its first month, but stated that she’s seeing more people engaged every Friday.
For Trade Coffee Co., a direct-to-consumer coffee marketplace, texting offers it a chance to tell customers how to make coffee as well as a place to reorder or ask for new recommendations. Currently, the company doesn’t use texting to solicit new consumers, but rather to reengage its existing customer base.
Unlike other channels, Trade Coffee has run into issues, such as texting character limits, so it sticks to messages under 100 characters and uses GIFs to supplement messages. About 20-25% of its customers use texting, the brand said.
“Text is great because you have your phone in your pocket [and] you can just text us and save the content on your phone,” said Mike Lackman, CEO of Trade Coffee. “If we’re going to interrupt them, we want to respect that and make sure it’s content that the customer makes.”