The State of SMS Marketing 2025: Adoption, AI Integration, and Future Outlook

In a digital landscape saturated with marketing noise, SMS remains one of the most direct and effective channels for reaching customers. SMS marketing serves as a fundamental business strategy for brands that aim to engage customers through immediate delivery. With near-instant delivery and open rates that far outpace email, SMS marketing has demonstrated its strong position as an effective marketing channel.

SMS marketing is experiencing major developments in 2025. Corporate adoption of SMS marketing has increased to the point where companies use it as a fundamental digital strategy element instead of an additional tool. This trend spans across multiple industries, not just one. With the current boom of AI technology, we can expect hyper-personalized features to come to SMS marketing, which will undoubtedly change the game. 

The State of SMS Marketing 2025: Adoption, AI Integration, and Future Outlook aims to examine the current usage, investment trends, and performance benchmarks of SMS marketing. The report collected recent data and experts' insights to explore the impact of SMS marketing, AI’s role in the long and short term, the current challenges, and the future of this channel. 

Key findings:

• 80.4% of businesses are actively utilizing SMS marketing

• The average marketing budget for SMS marketing is around 18.76% of the total budget

• On average, SMS marketing campaigns achieve a click-through rate of 27.7%, an opt-out rate of just 3.09%, and an ROI of $16.70 for every $1 spent

• One in every six companies (60.4%) are actively using AI in their SMS campaigns

• ChatGPT leads the market for chatbot integration in large-scale SMS interactions, with 69.8% of companies reporting its use

• More than half of the companies (64.5%) are planning to increase their budget for SMS marketing in the next year, with 78.5% of them allocating a heavier investment in AI integration

Current State of SMS Marketing

SMS Marketing Adoption

SMS marketing has firmly established itself as a core component of many organizations’ communication strategies. As of 2025, 80.4% of businesses are actively utilizing SMS marketing, signaling its widespread acceptance and effectiveness as a direct engagement channel.

The adoption rate of SMS marketing differs by company size. With medium-sized companies (51–250 employees) leading at 35.8%, followed by small businesses (1–50 employees) at 32.8%, and large enterprises (251+ employees) at 31.4%. It is clear that SMS marketing extends to all business sizes, and organizations are favoring immediate reach.

Retail companies have established themselves as the leaders in SMS marketing adoption as they require both fast promotions and effective customer interactions, driving a 19.8% adoption rate. The technology industry stands as the second biggest industry using SMS marketing, with 17.5%, followed by finance with 12.3%, education with 11.6%, along with e-commerce at 8.9%, and healthcare with 8.7%.

Barriers to SMS Marketing Adoption

Even though it has achieved popularity recently, SMS marketing is still facing fierce competition from email and social media, which have proven their effectiveness over a long period, accounting for 72.9% of non-adopters’ choice of alternative platforms. These traditional digital marketing tools continue to dominate marketing campaigns, as many industries require comprehensive content types that are not accessible with SMS marketing technology.

To motivate wider SMS adoption, businesses should adopt a structured educational workshop for their marketing associates and provide a clear onboarding process that would ease the procedure for new campaigns.

Budget Allocation for SMS Marketing

The average marketing budget for SMS marketing is around 18.76% of the total budget, revealing that companies treat SMS as a strong yet moderate marketing tool. The majority, with 41.2% of businesses, dedicate under 10% of their marketing funds to SMS, considering this more of a supplementary method rather than a key marketing strategy, despite recognizing its impact. 

The limited budget allocation indicates that SMS marketing has gained some prominence, yet many organizations are still seeking optimal SMS strategies to merge with their marketing strategies.

The next part of the report can provide a better picture of SMS marketing influence with real metrics in campaign execution and performance. 

SMS Marketing Campaigns: Frequency, Engagement, and ROI

Campaign Frequency

Businesses are approaching SMS marketing just as they did when social media was introduced, carefully and consistently. The most frequent is around 2-3 times per week, with 46% of businesses using this schedule. 

Even more careful is a once-a-week schedule, with 18.9% of companies adopting it. This serves as a more selective tactic.

Opt-Out Rates

Opt-out rate is one of the most important metrics in every marketing channel. For SMS, the average is around 3.09%, with: 

• 31.7% of companies experience opt-out rates between 1 and 2%

• 28.5% report opt-out rates between 3 and 5%
   

These are relatively low rates compared to email marketing, showing that when done correctly, with personalized content and appropriate frequency, SMS campaigns could be consumers’ preferred choice of communication. 

Click-Through Rate (CTR)

Regarding the click-through rate (CTR), SMS marketing is outperforming other channels, with an average of 27.7%. More than 65% of companies report CTRs between 10% and 40%, with 24.8% achieving CTRs above 40%.

Impact on Digital Marketing Success

41.5% of companies say texting customers has significantly contributed to their overall digital marketing success. This is a testament to the channel’s unique strength: close engagement, real-time communication, and the ability to cut through digital noise.

Return on Investment (ROI)

Companies report an average ROI of $16.7 for every $1 spent, making SMS one of the highest-yielding marketing channels:

• 13.9% of businesses report returns between $15 and $20

• 45.4% of companies report a $5 to $20 ROI range

Not only does SMS provide good engagement with the audience, but it is also a cost-effective channel, allowing for even better returns when integrated into an omnichannel strategy. 

AI Integration in SMS Marketing: Adoption, Use Cases, and Impact

AI Adoption in SMS Marketing

AI is affecting every aspect of the world, and SMS marketing is not an exception, with 60.4% of companies actively using AI in their SMS campaigns. This is a result of a preference for personalized content and data-driven communication strategies, from both the industry and the customers.

This is a growing trend, with: 

• 68.7% of businesses implemented AI within the past year, reflecting recent technological maturity and broader accessibility.

• 21.1% began using AI in SMS marketing 1–2 years ago.

• 10.2% of companies have integrated AI for over 2 years.
   

Most Common AI Use Cases

Personalization and optimization are the top aspects for AI implementation. The most common use cases are automated segmentation and targeting (31.3%), content personalization (27.2%), and handling customer replies (26.4%). 

AI is helping marketers achieve better efficiency with automation and content generation, making the overall experience for the audience filled with higher-quality content and seamless communication. 

Chatbot Usage in SMS Marketing

ChatGPT has dominated the market in terms of chatbots within large-scale SMS interactions, with a usage of 69.8% of companies, thanks to its effective content generator and easy integration process. 

Other notable players include:

• Gemini (16.2%) is known for its adaptability and Google integration.

• Deepseek (6.8%) is preferred by companies requiring more technical customization.

Generative AI and conversational automation are the most important aspects of marketing at the moment. 

Impact of AI on SMS Campaign Performance

AI has successfully produced substantial results: 

• Conversion rates increased by an average of 26.6%

• Engagement metrics rose by 25.8%

• Cost efficiency improved by 24.6%

The most common gain is around the 11-25% range, leaving room for even bigger improvement in the future. Some of the outliers (13.2%) report over a 50% increase in conversion, while a considerable number of businesses (25.7%) are experiencing around a 26-50% boost. 

However, around 5.3-5.7% of the participants are not witnessing any changes, revealing some potential misalignment between the user and the technology

Future Outlook: Trends, Investment, and Challenges in SMS Marketing

Investment and Confidence in SMS Marketing

With the current growth of demand for SMS communication, businesses are showing a stronger commitment to transforming their marketing strategy with SMS marketing. More than half of the companies (64.5%) are planning to increase their budget for SMS marketing in the next year, with 78.5% of them allocating a heavier investment in AI integration, highlighting an emphasis on personalization and efficiency. AI is becoming foundational in our digital marketing landscape. 

The future of SMS marketing is looking bright, with 69.2% of businesses optimistic about the future, which indicates a long-term investment in this channel rather than a complementary tool. 

Anticipated Challenges Ahead

Despite the optimism, companies acknowledge that the path forward is not without its hurdles. 43.1% of the participants report SMS fatigue as their top concern, followed closely by increased opt-out rates and compliance issues at 37.6%. Around a third (31%) of them expressed difficulty in measuring ROI and costs.

Final Thoughts: The Road Ahead

The state of SMS marketing in 2025 reveals a vibrant, fast-evolving space, driven by AI innovation, strong ROI performance, and deepening customer engagement. But as adoption grows, so does the pressure to stand out. Brands must strike a balance between personalization and intrusion, automation and authenticity.

With investments rising and AI integration becoming the norm, SMS marketing is poised to remain a cornerstone of modern omnichannel strategies - provided businesses address fatigue, compliance, and measurement head-on.

Methodology

To develop a comprehensive understanding of the current landscape of SMS marketing, we conducted a global survey of 546 marketing professionals across various industries and company sizes. The survey was administered via Prolific, a trusted platform for academic and market research, ensuring high-quality responses from verified participants.

Data collection took place in April 2025.