What are Transactional SMS Messages?

April 30, 2023 Julio Romero

Reading time about 9min

What are Transactional SMS Messages?

Every day, you’re probably receiving at least one transactional message. These are the short text-based communications that are used to convey information like “The payment for your order has been processed successfully” or “Your package is on its way.”

transactionl SMS messages

And though they may seem minor, these little bits of communication can actually have a huge impact on how people feel about your brand. That’s because transactional messages provide one more opportunity to make an emotional connection with your customers and encourage them to come back again in the future.

In this article, we’ll explore why it’s important and how to take full advantage of this opportunity by creating custom SMS campaigns that will engage customers and help grow your business.

What are transactional messages?

Transactional messages are the fundamental communications used to provide general information, updates, and confirmations. They can take many forms, going from a simple text message to a detailed email with attachments.

Transactional messages are a form of communication that can be utilized by any business or individual in order to convey a message that the receiver might not take notice of if it were not for the notification.

These messages are often used for customer service purposes such as providing shipping confirmation details, sending promotions, sending notifications about payment, or delivering product information. The key takeaway is that transactional messages should be sent only when you have something to say—otherwise they will seem intrusive and irrelevant.

Transactional messages are the perfect way to get your customers back into your store. You can increase their engagement and remind them of the products they’ve looked at in the past by sending them a reminder email or text message based on what they purchased last time.

What are the Benefits of Transactional SMS?

Transactional messaging is one of the easiest and most effective ways to improve customer experiences, increase engagement, and boost conversions. It’s also incredibly easy thanks to the SMS platform.

The benefits of sending transactional messages via SMS are vast. More importantly, the positive effects are easily measurable. The following are just a few of the main qualities that make transactional messaging work for you:

  • Faster turnaround times

Faster transaction response times may be beneficial to your company. Transactional messages are a form of communication that is sent with the goal of delivering an urgent message.

They are not routed through the same channels as regular marketing messages, so they won’t be slowed down by email filters or blocked like other types of bulk messaging.

  • Customizable content

It’s difficult to create effective marketing messages if you don’t know anything about your audience. Transactional messages can provide you with the information needed, with a little bit of pizzazz, if you prefer.

In order to ensure success, brands should focus on developing a personalized interaction with their audience. Personalizing messages is one method that companies use to improve the overall experience.

In fact, it goes beyond creating a well-designed message and launching an efficient campaign that generates results. By using transactional messages to deliver personalized and relevant messages, brands can improve their prospects and increase customer loyalty.

customization in sms

  • Higher response rates

As customers are increasingly reliant on their smart devices, companies need to ensure they remain competitive in this heavily saturated market. One particular way that brands can do this is by delivering high-quality transactional messages.

Successfully communicating with customers through text message marketing is one of the most important tasks for any business today. Text messages stand out among other forms of communication because they receive an upwards of 97% response rate. Compared to email, SMS’s response rates reach up to eight times more.

It’s also possible for these responses to improve your customer base by up to 800%. Text messaging has emerged as the key form of communication that offers all the necessary amenities like speed, versatility, and ease of use on mobile devices. Brands should think about how they can take advantage of its popularity.

  • Lower marketing costs

Transactional messaging is a form of communication that requires little effort on the part of the brand or company. One key aspect is that it’s highly scalable as it can be implemented with relative ease at any time or place.

Shopify has a default transactional messaging system that is free for use. But if you want to customize your transactional messages, you can sign up with WinBack SMS Marketing app. Our system is efficient, easy to use, and most of all, highly affordable!

  • Higher conversion rates

SMS marketing is a form of communication that sees the highest return on investment (ROI) among all other channels.

It’s a great way to reach out to new customers as it seamlessly moves from mobile devices used by existing clients into inboxes belonging to potential prospects. The latter group includes those who are not listed in your database but have opted in to receive SMS messages from your company.

Because links in text messages are already clickable, users can easily click the link within the message so they are quickly redirected to your website. Combined with attractive offers, you can ensure high purchase rates, making it a cost-effective way to increase sales.

  • Customer loyalty

When a customer makes a purchase, they will be sent a confirmation message that allows them to know what is in their order and when it will arrive. By acknowledging the buyer’s first purchase by sending transactional messages, companies can increase their engagement with customers on an individual level which inevitably results in better conversions rates.

Furthermore, customers are more likely to make another purchase in the future when they feel acknowledged and appreciated by a brand.

  • Improves Customer Relations

Customers are less likely to complain about your product or service if they are always updated about their order.

Think about when you yourself ordered something online. How did you feel when you’re kept informed about the status of your purchase, from the time it was made to when you get your hands on it? You felt that the business you purchased from is legitimate, allowing you to think of them the next time you need similar products, right?

Customer engagement is an important aspect that all businesses should take into consideration when looking at their marketing strategy. To do this, it’s crucial that brands focus on keeping customers engaged by providing them with the information they need. This includes notifications for tracking shipment, confirmation of payment, and order updates.

In time, customers will look forward to these messages that provide them with real-time feedback from a business as well as insight into what is happening behind the scenes.

In order to get the most out of transactional messaging for your brand, you must determine the best strategies for improving your one-on-one customer engagement.

Customers are more likely to engage when they receive prompt responses and information on when their orders will arrive or when/where they can expect it. By utilizing this strategy, businesses can easily increase conversions by offering personalized services that meet the needs of each individual buyer.

  • Measurable results

The main advantage of transactional messaging is its ability to provide measurable results for businesses. This includes sending and click rates for order confirmations, payment receipts, shipping updates, and more.

One of the main benefits that transactional messages bring is that it provides companies with a wealth of information about individual customers and how they interact with a brand. By tracking these messages, businesses can improve their one-on-one engagement with customers which will eventually increase conversions over time. In addition, this allows brands to determine where they can make improvements in order to enhance the customer journey from start to finish.

Promotional vs Transactional SMS: What is the Difference?

Promotional SMS is sent as a marketing message to a customer. The idea is to be topical, timely, and topical in order to generate interest from the customer. Promotional messages contain discounts and promotions to tease the customer into checking out the latest offer.

promotional vs transactional sms-1

Transactional SMS is the opposite of this – it is used for order updates, billing, shipping notifications, etc. In short, customers expect to receive transactional messages.

Transactional messaging is currently being used not just by major corporations around the world, but even by small businesses who understand that utilizing SMS technology so that customers can check their delivery statuses from their smartphones is a bright idea.

Transactional messages are sent to targeted customers with an active interest in receiving them. Unlike promotional messages, transactional messages require less effort from the sender, which in turn increases open rates.

Types of Transactional SMS Messages

Transactional messages for SMS consist of order updates, billing, shipping notifications, and more. These messages are sent directly to the target customer’s mobile devices and thus an active interest in receiving them is required by that individual.

Transactional messages for SMS can be broken down into the following types:

1. Purchase Information or Order Updates

Informative notices are messages sent to your customers to let them know about their order status. These messages inform customers about their orders, such as payment details, changes, confirmation of delivery statuses, order tracking numbers, and more.

For example, if someone has ordered a dress from your store and they completed their payment online, your store can send an automated message saying the order has been confirmed and payment has been approved.

Once you have processed the order and it’s on its way, you can send them a message with the tracking number and expected delivery date.

Other informative notices include:

  • order confirmation
  • payment confirmation
  • subscription confirmation
  • order change
  • delivery status

Here’s an example of a purchase information transactional message:

purchase information transactional messages

2. Customer Information Updates

This type of transactional message is used to send updates on subscription services, billing reminders, registration confirmation, password reset links, etc.

This type of transactional message includes welcome messages and subscription opt-in confirmation. Welcome messages are messages sent to new subscribers after they have successfully subscribed to your SMS marketing list.

It is a good idea to send them messages that let them know about the benefits of being on your list so they will be more likely to engage with you over time.

3. Booking reference or Appointment confirmation

Transactional messages are not only used by eCommerce and online retail stores but also by businesses that provide goods or services in person such as hotels and restaurants.

Customers often forget to ask certain questions at checkout so using SMS for these reminders would be a good idea as well as sending out informational notices.

Booking notices can also include booking confirmation and booking cancelation that is typical with flight reservations.

4. One-time passwords

One-time passwords for SMS are designed to provide an extra layer of security which can be beneficial for businesses using SMS marketing. These are pretty common nowadays, and the number one choice for sending OTPs is via SMS since people typically have their phones on hand and a mobile phone has its own security features.

They are used much like the common password system where customers enter their password (a one-time password that is sent via SMS) in order to authenticate themselves.

This improves security significantly since standard passwords are often hacked or compromised as they are only ever changed every so often. Sending out one-time passwords via SMS is a great way to stay proactive about your security.

5. Password Reset

Transactional SMS can also be used to reset passwords for your customers if they forget it which is another great way to use SMS technology. This can enhance security and reduce common issues with traditional password systems that are often hacked or compromised.

6. Account Updates and Error Notifications

Account updates consist of messages that update your customers on their account activities such as alerts, notifications, and more. These messages will inform the customer about any changes made including order statuses, billing info, shipping notices, new services added to their account, etc.

By updating customers with these types of messages you are creating a lasting relationship between the business and consumer.

Error notifications are also those related to the account, such as when the customer attempts to enter an incorrect password or when their payment method failed to complete a subscription payment.

These messages can provide alerts about when there are any issues making it easier for customers to fix problems leading to increased customer satisfaction.

7. Cart Recovery

Cart recovery is an excellent way to encourage customers who abandoned their shopping carts to complete the purchase. Customers often abandon items in their shopping cart because they need time to think about what they want to buy or decide if it’s worth spending money on.

Using SMS for this strategy will make you appear more available and interested in your customer’s needs while also encouraging them back into your shop which can increase conversions overall.

However, you must ensure that you send such messages at the optimum time to prevent customer irritation. Read our guide on the best time to send SMS messages to your customers for more information.

Round-up on Transactional Messages

Transactional messages should be used wisely by brands, especially when these messages are automated through machine learning or AI (artificial intelligence) software.

While some companies may find success with this type of messaging, others may be tempted to spam their readers by bombarding them with too many notifications which can turn off consumers quickly and eventually lead to a loss in sales. Profit margins can be thin in today’s market so any customer loss is a big hit to the business and brand reputation.

Transactional messages are not only used by businesses but also by banks, government agencies, healthcare organizations, etc. Therefore it’s important to keep your message brief and concise so that information is easily digested and understood by the consumer.

These types of messages should be sent out at optimal times such as right before or after hours when people may not be busy with work/family commitments and can respond quickly without any interruptions which allow for fast responses and increased engagement rates overall.

Businesses should also use SMS messaging to increase online conversions, drive website traffic, gain customer insights, improve marketing efforts, capture leads, and so much more. It helps people grow their business in today’s market which is constantly evolving due to technological advances.

If you’re interested in learning how transactional messaging can help your business then check out our related articles about using SMS for marketing campaigns as well as examples of successful campaigns that you can use as inspiration and guidance!

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Topics: SMS Marketing