21.11.2024
SMS Marketing in the USA: Trends, Compliance, and Top Providers
SMS marketing is a must-have strategy for businesses looking for direct, personal, and highly effective customer communication. With an impressive open rate of up to 98%, SMS messages are almost guaranteed to reach and engage recipients, outperforming email marketing text messages and many other marketing channels. This near-instantaneous method allows businesses to deliver timely offers, updates, and personalised messages directly to customers’ phones, fostering a more intimate and responsive connection.
In this article, we’ll explore the latest SMS marketing trends in the US, essential legal considerations for compliance, and top SMS marketing platforms that US businesses can trust to maximise impact and drive engagement.
Why SMS marketing is growing in the US
SMS marketing is experiencing rapid growth in the US due to its uniquely personal, immediate, and highly effective nature. Unlike marketing emails, which are often buried in cluttered inboxes, SMS messages pop up directly on users' screens, where they’re nearly impossible to ignore. This directness helps SMS feel more personal and immediate, making it an ideal channel for brands aiming to cut through the noise and engage customers directly. As mobile phone ownership in the US has increased dramatically — from 81% in 2015 to 97% in 2023 — SMS and sms marketing strategy has become more relevant than ever, allowing brands to reach an extensive and growing audience.
Notably, SMS boasts one of the highest open and engagement rates among all digital marketing channels. This proven success has led a phone number of major brands like Domino's Pizza to use SMS for time-sensitive offers and coupon codes, consistently driving customer responses and conversions. Its speed and simplicity make SMS perfect for flash sales, appointment reminders, event notifications, loyalty program updates, and even customer feedback requests. With more businesses recognizing SMS as a powerful tool for creating instant, impactful connections, the growth of SMS marketing in the U.S. shows no signs of slowing down.
Recent trends and statistics for SMS marketing campaigns in the USA
SMS marketing in the United States is on a significant upward trend, with the market projected to reach $12.6 billion by 2025, growing at a compound annual growth rate (CAGR) of 20.3%. This growth is largely driven by increasing demand for personalisation, where brands are segmenting audiences to create tailored messages that resonate on a personal level. Audience segmentation based on behavior, demographics mobile device used, or purchase history, businesses can ensure that messages are relevant and impactful, leading to higher engagement and brand loyalty.
Automation of promotional messages is another key trend in SMS marketing, allowing brands to streamline communication and increase efficiency. Automated messages for order confirmations, shipping updates, and even abandoned cart reminders have become standard practice among US brands, ensuring timely information reaches customers without added manual effort.
Additionally, multimedia messaging services (MMS) and the more advanced rich communication services (RCS) are catching on, enabling brands to go beyond traditional text messaging. Companies are now incorporating images, videos, GIFs, and even stickers into their campaigns, creating a richer, more interactive experience.
A Forrester report underscores SMS marketing's importance, with 60% of surveyed US organizations reporting that they use text messaging to communicate with customers. With personalization, automation, and multimedia capabilities evolving, SMS marketing is positioned to continue as a vital, high-impact channel for US brands in the years to come.
Compliance: Key SMS marketing laws in the USA and who enforces them
The Telephone Consumer Protection Act (TCPA)
The Telephone Consumer Protection Act (TCPA) was introduced by the US Congress in 1991 to prevent consumers from unsolicited and intrusive telemarketing, phone calls, faxes, and text messages. Passed in response to growing concerns over aggressive telemarketing practices and the invasion of consumer privacy, the TCPA established strict guidelines for businesses reaching out to consumers via telephone and SMS.
Under the TCPA, businesses that send text messages to consumers without their express consent can face substantial penalties of up to $1,500 per unwanted text. For any business texting customers in the US, compliance with the TCPA is not just important—it’s essential.
The key to TCPA compliance is simple: ensure customers have consented to receive your messages. To gain this consent, businesses should use transparent and straightforward methods that make it easy for customers to agree to SMS communications.
For example, during an online checkout process, companies can include an opt-in checkbox for receiving SMS updates, with clear language about the type and frequency of messages they’ll receive. Additionally, in-store promotions with SMS opt-out requests and back-in options are popular ways to gather customer consent.
The CAN-SPAM Act
Controlling the Assault of Non-Solicited Pornography and Marketing Act was signed into law in 2003 by the US Congress to set standards for commercial messaging and curb the rising tide of unsolicited and misleading emails. As the early 2000s saw a massive surge in spam emails, often with fraudulent or harmful content, this act was established to protect consumers and create transparency in commercial messaging. Although primarily aimed at regulating email marketing, CAN-SPAM also applies to certain types of SMS marketing, particularly automated or promotional text messages.
One of CAN-SPAM’s essential requirements is to provide recipients of commercial messages with a simple, clear way to opt out of future messages. This rule ensures that consumers are not locked into unwanted communications, giving them control over their interactions with businesses. This approach helps build trust with audiences by ensuring that they know who is contacting them and why, reducing the risk of being perceived as an imposter or fraudster.
The California Consumer Privacy Act (CCPA)
The California Consumer Privacy Act (CCPA), introduced by the California State Legislature and signed into law in 2018, is one of the most comprehensive privacy laws in the United States, designed specifically to protect the privacy rights of California residents. The law was driven by increasing public demand for greater control over personal data, spurred by data privacy scandals and the widespread collection of personal information by tech companies.
Though not specific to SMS marketing, the CCPA sets strict guidelines for how businesses may use and store customers' contact information, including phone numbers, for marketing purposes. Under the CCPA, businesses must inform customers about data collection practices and obtain their explicit consent before sharing or selling their data.
Failure to comply with CCPA guidelines can result in significant penalties. Businesses that violate the law may face fines up to $2,500 for each unintentional violation or $7,500 for each intentional violation. Additionally, customers have the right to request that their data be deleted and to opt out of having their information shared with third parties for marketing.
The FCC (Federal Communications Commission)
The Federal Communications Commission (FCC) is the primary regulatory authority overseeing communications in the US, including SMS marketing. If a business’s SMS marketing practices violate the FCC that investigates and enforces penalties.
The FCC’s primary goal is to protect consumers from unwanted, unsolicited messages. Through regulations like the Telephone Consumer Protection Act (TCPA), businesses are required to obtain explicit consent from individuals before sending marketing texts. Non-compliance can lead to significant fines and legal repercussions. The FCC also mandates that businesses provide a clear and easy opt-out option for recipients, ensuring consumers have control over the messages they receive.
The Cellular Telecommunications Industry Association (CTIA)
The Cellular Telecommunications Industry Association (CTIA) may not be a government agency, but it plays a critical role in shaping SMS marketing practices. As a trade association for the wireless telecommunications industry, the CTIA sets the guidelines that wireless carriers enforce for SMS marketing.
These guidelines cover key elements like obtaining consent, limiting the frequency of marketing texts, and implementing clear opt-out mechanisms, ensuring that messages are relevant and respectful. The CTIA works closely with carriers to suspend services for businesses that don't comply with these standards, disrupting their ability to send messages across various networks.
Best practices for complying with US SMS marketing regulations
Complying with U.S. SMS marketing regulations is essential for building trust and avoiding fines. Here are some best practices to help keep your SMS and text message marketing campaigns effective and compliant:
- Provide a Clear Opt-Out Option: Every marketing text should make it easy for users to unsubscribe. Including a line like "Reply STOP to unsubscribe" is both compliant and consumer-friendly. This ensures that people can opt-out easily if they no longer want to receive your messages, keeping you in line with both legal and industry standards.
- Avoid Spamming: No one wants to feel bombarded by messages. Avoid sending too many texts — 1 to 2 per week is generally a good balance. A/B testing can help you determine the right frequency for your audience, making sure your messages remain welcome and engaging rather than overwhelming. Too many texts can lead to unsubscribes without a second thought, so monitoring engagement rates and adjusting accordingly is key.
- Time Your Messages Right: Pay attention to the timing of your texts. US regulations restrict sending marketing messages during certain hours (often late night and early morning), so always verify local restrictions to ensure your messages don’t disturb recipients at inappropriate times.
- Keep Consent Records: Properly store records of customer consent. This provides you with proof that you obtained permission to send messages, which can protect you in the event of any disputes. It’s especially important if someone challenges a message’s legitimacy, as you’ll have records to show you followed legal guidelines.
- Maintain Your Subscriber List Responsibly: Regularly review and update your SMS subscriber list to avoid issues with outdated or restricted contacts. Checking the national Do Not Call (DNC) registry and other opt-out lists will help you avoid sending messages to individuals who have previously opted out of marketing communications, protecting you from accidental violations due to negligence.
3 popular SMS marketing providers for businesses in the USA
1. DecisionTelecom
DecisionTelecom is a global SMS provider specializing in SMS messaging solutions for businesses, helping companies streamline communication with their customers through reliable and efficient SMS services. DecisionTelecom offers a range of features tailored to meet business needs.
The platform’s SMS gateway is optimized for high deliverability, ensuring messages reach intended recipients quickly and reliably. The SMS program supports international messaging, allowing businesses to reach audiences across the globe. High message deliverability rates are a significant advantage, especially for time-sensitive text communication.
DecisionTelecom offers a flexible pricing structure based on message volume, destination, and features required.
2. Twilio
Twilio is a prominent cloud communications platform offering a variety of services, such as SMS messaging, voice, video, and beyond. Known for its flexibility and robust API, Twilio enables businesses to integrate SMS capabilities into their applications seamlessly.
It’s a popular choice for companies of all sizes, from startups to large enterprises, seeking custom communication solutions. Twilio’s powerful API allows for high customization, making it ideal for businesses with unique messaging needs, from SMS to WhatsApp and even MMS. Twilio is highly scalable, making it suitable for both small businesses and large enterprises.
Twilio offers a pay-as-you-go pricing model and also provides a free trial, allowing businesses to test the platform’s features before committing.
3. SimpleTexting
SimpleTexting is an easy-to-use SMS marketing platform geared toward businesses that want to communicate with customers via SMS without requiring advanced technical skills.
With an intuitive interface and numerous features tailored to small and medium-sized businesses, SimpleTexting is popular for SMS campaigns, promotions, and customer service. SimpleTexting’s interface is designed for ease of use, making it accessible even for users with no technical background. Known for strong customer support, it’s great for companies that may need setup assistance.
A 14-day free trial allows businesses to explore features and see if the platform suits their needs before committing to a paid plan.
Conclusion
SMS marketing in the US continues to grow rapidly, but it’s crucial to comply with regulations to avoid penalties and ensure the legality of your campaigns. Laws like the TCPA, CAN-SPAM Act, CCPA, along with regulations from the FCC and CTIA, set clear rules for obtaining user consent, ensuring transparency in communications, and providing opt-out options. These requirements guarantee that businesses communicate with their customers in a fair and lawful manner.
We’ve explored three popular SMS marketing services: DecisionTelecom, Twilio, and SimpleTexting. Each of these platforms helps businesses stay compliant with regulations while providing effective tools for campaign personalization, automation, and performance tracking. Choose a reliable partner like DecisionTelecom to take your business to the next level and achieve your goals with efficient, compliant, and scalable SMS marketing.
