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Aug 5, 2020

Digital Commerce 360: TechStyle Tests Out Text Message Marketing

44% of companies say push notifications offer a greater ROI than email

by Katie Evans | Aug 5th, 2020

Marketing messages such as text messages and push notifications can pay off. And for some companies, they offer a better return on investment than email.

A new study of 300 businesses—around 20% of which are retailers—finds that 72% of businesses say mobile and web app push notifications offer a greater or equal return on investment than email, and 44% say the ROI from the marketing channel is greater than email. The study, from OneSignal, which offers email, app and push notification-based marketing messaging services, also finds that 82% of companies say push notifications help them meet or exceed their business goals.

However, less than 50% of mobile apps use push notifications, according to app analytics and optimization company Appfigures. 24.3% of retailers in the 2020 Digital Commerce 360 Top 1000 have apps.

In analyzing its client data, the OneSignal also found that sending a mobile push notification specifically drove up daily active users of apps by an average of 35% over a 30-day period. The survey of OneSignal’s clients was conducted in April and May 2020. The push notification data is was collected May 12- June 11 on 29,949 apps with a minimum of 10,000 users.

Other retailers are finding success in another form of mobile marketing: text messages. Matthew Berk, CEO of online coffee subscription retailer Bean Box, says his company is shifting resources to text messages over email. “We’ve been prioritizing engineering and marketing resources towards coming up with more relevant and interactive text messages for our customers,” he says.

Earlier this year, Bean Box deployed nine different text message flows, based on the customer lifecycle, two of which allow the customer to immediately order any of the products mentioned in the message by responding via SMS, he says. The retailer has also stopped gathering email addresses via mobile and is instead asking for a phone number in exchange for a discount.

“We’re seeing a ton of opportunity in SMS marketing, and we’re moving resources there,” Berk says. “The response and sell-through rates have been really strong, and we’re expanding the reach of our order-via-SMS feature so that customers can order coffee literally by responding to a text message.”

He says 2% of the text messages Bean Box sends to consumers who haven’t bought from the retailer before result in a sale. He is happy with that result. But, he notes, that set of consumers is a prequalified audience because they have opted in by providing their phone numbers to the retailer. “Our sense is that people are just constantly on their phones and responsive to brands they already trust to send them texts.”

Berk isn’t alone. Other retailers, including apparel and accessory subscription retailer JustFab.com, which is owned by TechStyle Fashion Group, No. 56 in the 2020 Digital Commerce 360 Top 1000, are testing out text message marketing. “SMS is our newest channel,” says Erin Vitero, director of customer relationship management for TechStyle Fashion Group “We really want to create personalized experiences across SMS.”

52% of retailers say they spend 21% or more of their digital marketing budgets on mobile, according to a Digital Commerce 360 survey of 105 online retailers conducted in May and June 2020. Additionally, 36% of retailers say text message marketing has been effective and 26% say app-based notifications such as push notifications are effective. 27% spend more than 10% of their digital marketing budget on mobile advertising and 41% say those ads are effective. 18% say mobile ads are effective specifically for acquiring new customers.

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