Research & Technologies Unit of Initiative
   
December 2003
Invitation Price: 15 Min
SMS
Selling Made Smarter?!

Introduction
A significant addition to the increasing list of communication carriers, is that of SMS, Short Messaging Service. SMS has become the fastest, easiest and the most convenient way to communicate today. For reasons personal or professional, SMS works across purposes. The most recent application of SMS has been to reach out to the consumer offering him products and services just as any of the other mass media would. Be it in the form of promotions or advertising or even sales, the functionality of SMS usage is crossing all barriers.

Nature of Usage
From a simple message to a friend, to confirming/ canceling meetings, perhaps okaying deals, having confrontations without having to face the person, keeping conversations short and simple, finding your soulmate, sending across greetings, to downloading jokes, tunes, pictures, songs and so on, SMS has emerged as a multi-usage communication mode across ages and purposes. Apart from these, the usage of SMS has broadened its dimensions due to the constant upgradation in technology, which in turn is a result of the increasing competition amongst both the mobile handset providers as well as the service providers.


Address your queries to Madhavi P. Goswami at intellect@lowemail.com
Be it the ability of allowing to click pictures through a mobile phone and sending the same across to a friend, or requesting a certain facility (cricket scores!), or wanting to make a purchase, or sending group messages, or promoting a brand, SMS (and MMS) does it all.

The Media Clutter
Amongst the sea of communication channels hitting the consumer constantly, the actual message usually gets lost. Many a times, the possibility of the right message reaching the right target is also dwindled, not ruling out the fact that this has a direct impact on the costs shelled out for such activities. Unlike the mass media, SMS enables micro targeting, which ensures that there is no spillover of the communication. The use of this medium also allows the consumer to react to the communication on the spot, which helps measure the effectiveness of the campaign. Then there is always the option to explore the possibility of this medium being used to propagate word-of-mouth. Every single target that the communication is being sent to carries the potential to be the originator of a new chain of targets. It just depends on how interesting and action-provoking the message designed is for the chain to remain continual. Reflecting this idea are 2 case studies; one BBC Worldwide, which successfully boosted circulation of 'Top of the Pops' magazine through an ongoing text service and the other of East West Records, which successfully promoted a UK dance act Oxide & Neutrino with a wireless marketing campaign.

 

Another interesting aspect is that ownership of a mobile phone is individual in nature. For many, it has an emotional connotation, which is an important factor while considering using SMS as a communication channel. Also the possibility of an SMS not being read (in comparison to a promotional E-mail not being opened) is quite negligible. Even a message that does not interest the consumer will at the most go unanswered but hardly unnoticed.
Apart from E-mail, SMS is the only medium that allows Permission Marketing, the term itself depicting the fact that the marketer can obtain the permission of the consumer before the latter is made part of or exposed to any promotional/ marketing activity.
To summarize it, SMS as a medium is all pervasive (makes the consumer reachable at all times), personal, allows Permission Marketing, interactive, generates impulsive responses and direct as far as approaching the right target is concerned.

Growth of SMS usage
In a very short span, the usage of SMS worldwide has reached competitive figures. The volume of SMS in India grew more than three-fold during the last year. From 80.6 crores the figure touched 24,500 crores by the end of 2002. In 2002 each cellular user in India sent around 26 SMS per month on an average. SMS has graduated from a mere add-on service into a communication channel alongside voice calls in India. (Gartner Dataquest report) Another survey done by IDC shows some interesting figures on SMS usage in certain metros and also compares the incidence of calls against SMS. The growth of SMS usage world over is quite phenomenal. Especially noteworthy is the growth in comparison with Internet usage. It is getting an acceptance across ages owing to its multi-faceted applications. In a very short span it has overtaken Internet figures in quite a few countries. According to a research conducted by Gartner G2, 41% of European adults use SMS as compared to 30% who use Internet/e-mail. Last year this figure was 28% for SMS users and 29% for Internet. In UK, 49% of adults use SMS while 39% are online. Germany poses 43% of adult SMS users as against 29% of Internet/e-mail users. In France the SMS usage is 30% as compared to 25% who go online. How does India feature in this comparison? Internet usage in India is quite credible. But will SMS usage takeover here too? Maybe it is too soon to say anything now. But in some time, India is quite likely to follow the trend.

Current Promos using SMS
Given this strong value of SMS as a medium, a host of companies are using SMS as a chief medium for their promotions. And the response…. Awesome. It could be a Brand Promotion or a sales activity, or an offer by the service operator, SMS seems to be an answer to all types of communicational requirements.

Amongst the many examples of SMS related exercises taken up by marketers, one is that of Kinectic engineering who tied up with Yahoo to generate awareness response via SMS. The idea was to create awareness for Kinetic Nova among the target audience and to increase brand recall via various offline and online activities. The promotion was devised by Yahoo for Kinetic's 4-stroke wonder scooter Nova - which received a record one million responses.
Virgin Atlantic Airlines enabled a facility wherein its passengers could SMS from their seat-back television screen to e-mail addresses or mobile phones on the ground.
Standard Chartered tied up with Mobile2Win to carry out contests and promotions which were communicated to the customers on mobile via sms and win them exciting merchandise and many other gifts. These and many such promotions are generating great responses all across.
Selling via SMS also picked up momentum recently as 700 Harry Potter books sold through SMS 8888.
Cadbury India tied up with BSNL mobile for SMS enabled vending machines. About 30-35 user-friendly machines would be placed at select congregation points in Mumbai. With the introduction of m-cash, the country's first mobile payment solution, BPL Mobile has introduced cashless payment using the mobile phone. BPL Mobile subscribers can buy a Cadbury chocolate, for which the payment would be reflected in the bill. A similar tie up has been initiated by BPL Pepsi for SMS enabled vending machines.
In another scene, Lufthansa German Airlines in association with Mobile2Win organized the first-ever, live ticket auction through SMS in India.
Selling products/ services that do not require quality inspection in detail or those, the purchase of which is impulsive or unplanned in nature, seems to be a perfect fit for the SMS medium.
Service operators also see SMS as the most feasible solution for communicating many of their value-added services. For example, Airtel allowing recharging of SIM card via SMS, BSNL offering assisted SMS services on landline, Bharti Teletech providing SMS enabled telephones to BSNL. The participation of mobile service operators in this exercise only benefits in increasing the availability of SMS being used for all practical purposes.
Media players too have picked up the pulse and are using this medium for many of its unique advantages. HBO promoted 'The Mummy Returns' contest via SMS which allowed consumers to respond using the Internet and SMS. The response to the warm-up contests was overwhelming with over 5000 responses received in the first week itself!
BBC World, in its marketing of the ongoing quiz show `University Challenge', used SMS along with radio and the Internet (yahoo.com) as a medium for entries, and received more than 15,000 entries on SMS alone.
Radio Mirchi broke new grounds in FM Radio interactive programming by auctioning a date with Kareena Kapoor. Listeners had to SMS their bid to 8888. The auction could be played by anyone with an access to a mobile phone. The bidding for the lunch date began with Rs 5,000 and on the first day of the two-day auction, there were already more than 1,800 responses and the bid has crossed Rs 85,600 in Mumbai alone. The proceeds of the auction were donated to Nav Nirman Foundation, a home for the poor, addicts and the mentally challenged.

Discovery and Star Plus also have used SMS to increase their programme viewership. Though on an experimental stage, Star Plus used the SMS medium to track the curiosity of television viewers about their serials. The channel started with Kyunki Saas Bhi Khabhi Bahu Thi, to check the percentage of people who send SMS to Star Plus at 7827 to know about the next episode of Kyunki, the response to which was surprisingly huge. Discovery Channel used the SMS medium to promote its new programme, Berman and Berman, where viewer interactivity was an integral part of the programme plan.
Escotel and NDTV tied-up to provide a News Service called "NDTV Wireless" to all Escotel-Haryana customers via mobile.
Indian Express associated with the Arab news channel, Al-Jazeera, to provide the breaking news from US-Iraq war on SMS. The Indian Express readers got the latest updates by SMSing 'AJ' at 3636. Active Media Tech was roped in by Indian Express to provide the backend technology to power the service.
All kinds of promotions seem to have taken SMS as a must route of communication. Keeping abreast with the latest, let us not miss out the recent promotion taken up by the 'most talked about soap' on television, Jassi Jaisi Koi Nahi which also used SMS as a medium to provoke responses from viewers asking them to send across their views on its episodes.
On one hand where a threshold is achieved wherein the consumer can be reached at any given point in time, let us be careful not to invade his personal space or lower his threshold of irritation. This otherwise, will lead to another case of arousing the need of a system that does away with junk SMS just as today we can Spam junk mails.

Future of SMS
Marketing via SMS is the just the beginning of developing relations with the consumer. A lot of innovation has been observed in this aspect which has given more than the desired results. Selling via SMS has also started picking up momentum and will soon be at par with the figures of trading on Internet.
There is an element of personalization in marketing via SMS, which increases the possibility of participation/ response by the consumer. This single aspect can drive the scope of SMS usage to great heights. We are not far from the day when we experience events like preliminary rounds of entrance exams and interviews; regular shopping; booking holidays, restaurants; sending invites and so on, to be a regular feature of SMS.

Conclusion
The fast growing trend of SMS usage for multi-purpose activities has generated the need to find out more about the profile of people who welcome SMS as a regular feature of their life. In its quest for getting into the depths of not only the demographics of such users but also their psychographics and media habits, Intellect, the Research and Technologies unit of Initiative is carrying out studies on similar grounds.