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What is the Cost of SMS Marketing? (And What’s the ROI?)

Mass texting services often have different cost structures. Here are the questions to ask when reviewing them.

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In our review of text message marketing trends to watch in 2024, we predict that the adoption of SMS marketing will undergo a substantial surge. In fact, according to Forrester Research, SMS marketing spend is set to increase to $83 billion by the end of this year.

With businesses that implement SMS marketing being 217.33% more likely to report success, it’s no wonder that they’re growing increasingly interested in this marketing tactic.

Most marketers and business owners don’t doubt the effectiveness of SMS. The question they want the answer to is: how much does it cost to send mass text messages?

Here’s how to evaluate the cost of mass texting and outline what kind of ROI you can expect.

What Is a Mass Text Messaging Service?

Before going any further, it’s important to understand what SMS marketing is. SMS marketing, or Short Service Message marketing, involves sending targeted text messages to your audience.

SMS marketing is often used interchangeably with text message marketing. While SMS refers to short text messages of 160 characters or fewer, text message marketing includes Multimedia Message Service, which is simply messages that are greater than 160 characters and those that include rich media like images, videos, PDFs, and other file types.

SMS marketing can be used across several industries to send special offers and promotions, emergency alerts, staff communication, daily text message updates, sweepstakes, and more.

If you’d like to learn more about how businesses are using mass texting, we recommend reading through our success stories.

How Much Does SMS Marketing Cost?

When it comes to SMS marketing, it’s only natural to wonder about the costs involved. Although the answer isn’t a straightforward one-size-fits-all figure, we can break it down to help you understand what you might be spending with a mass SMS platform.

Many elements contribute to the overall expense. Initially, you’ll encounter a baseline cost per text, generally ranging from $0.01 to $0.05 for SMS messages. If you want to send more dynamic content through MMS, expect a slight upcharge. International texting fees can also push the rate to anywhere between $0.25 to $0.50 per message.

Instead of billing you for each individual text, many service providers offer bundles with a set number of message credits. These credits, applicable for SMS and MMS, help businesses predict and manage their expenses effectively. These bundles often vary and allow you to pick one that aligns with your anticipated messaging volume and business goals.

Beyond just sending messages, SMS marketing often incorporates the use of keywords. Keywords are specific terms that customers can text to opt-in for communications from your brand. Some plans include a predefined set of keywords, while others allow you to add more a la carte, adding another layer to the cost structure.

For an additional cost, some platforms even come with an extra suite of features, ranging from API access for deeper software integration to advanced list-building tools and analytics, offering a more holistic marketing approach.

Grasping the complete cost of SMS marketing requires a holistic approach. Consider the per-text charges, the allocation of message credits, the cost or inclusion of keywords, and the availability of extra features.

Each factor will vary depending on the provider, so it’s worth shopping around to find the plan that best suits your needs and budget.

How Much Does SMS Marketing Cost with SimpleTexting?

For businesses looking for flexible and comprehensive pricing options, SimpleTexting provides plans starting at just $29 for 500 text credits. With tiered pricing that scales with your needs, a variety of keyword options, and no contracts, it’s a solid choice for businesses of all sizes.

  • No charge for incoming SMS messages (and just 1 credit for MMS)
  • Unlimited keywords included in your base plan
  • Access to all features with any tier plan you choose
  • Remaining monthly credits roll over until the end of the following month

Determining the Cost of Sending an SMS Text

First, let’s look at the cost of sending individual SMS text messages. The price can vary depending on your plan and how many texts you’re sending.

With SimpleTexting, our plans start at just $29 for 500 text credits with a toll-free number. Alternatively, you can opt for a local number at $39 with a one-time $4 wireless carrier registration fee.

Each SMS message you send costs one credit, so if you sent 500 that would be $0.058 per SMS message. But don’t panic if you go over your limit; our extra credits are an affordable 5.5 cents each.

Formula:

Cost of text = spend / # messages sent

The Flexibility of Your Plan

Unlike some platforms, SimpleTexting offers flexible options to meet your needs. You can upgrade or downgrade your plan as you see fit, and there are no contracts to tie you down.

We make it easy to adapt your SMS marketing efforts in line with your business goals and customer engagement levels.

Keywords and Their Costs

Unlike other providers, you get unlimited keywords with SimpleTexting as part of any plan.

Keywords play a significant role in SMS marketing. They allow your customers to opt-in to your messages, usually by texting a specific word to a number.

For instance, you might invite customers to text “WINTER25” to your business number to get 25% off your winter collection.

Additional Features

SMS marketing is not just about sending text messages and keywords. Some SMS marketing platforms even offer API access and advanced list growth tools.

SimpleTexting provides tiered pricing plans, each offering a unique set of features designed to meet different needs, from small businesses to large enterprises.

How to Evaluate the Cost of a Mass Texting Platform

Here are the six questions you need to ask when evaluating a mass text messaging service on cost.

1. What Is the Per-Message Rate?

Most mass texting solutions’ pricing is based on purchasing a certain amount of messages that you can then send on a monthly or annual basis.

You can check out our per-message rates on our pricing page. Like most providers, the more messages you send, the cheaper each message will be.

And before you ask, no, you don’t get charged for receiving SMS messages with our service.

2. Is There an Unlimited Text Messaging Plan?

If a platform offers you an unlimited text marketing plan, there’s a catch typically involving a limit on the number of contacts you can have.

That’s because SMS aggregators charge SMS providers like SimpleTexting a price per message. 

If a service says that all of its customers send as many messages as they want without any limits, they’d quickly go out of business. 

3. Is There a Platform Fee?

We don’t charge any flat platform fee at SimpleTexting–our pricing is based on the volume of messages you send. 

4. What Level of Service Is on Offer?

If you’re going to buy a car, the price might be the first thing you’re going to ask about to ensure it’s within your budget. But you don’t stop there. You’ll ask about the number of miles, the engine, and so on.

That’s because if the brakes don’t work, it doesn’t start, and the windscreen is badly chipped––it’s not much use to you no matter how cheap it is.

The same is true for your text messaging service. For example, if you need to send emergency text alerts, you want to know your service offers quality customer service. 

There are also other factors like ease of use. Often when a platform is at the very bottom of the market in terms of price, it’s because there’s been little to no investment in the user experience or functionality. 

The best way to put a value on these “intangibles” is to read reviews on third-party websites like G2 Crowd and Capterra. If they are overwhelmingly positive, it’ll be clear customers feel like they’re getting value for money.

5. Can You Upgrade, Downgrade, or Cancel Your Plan Easily? 

It’s worth making sure that your SMS marketing services’ monthly plans have no contracts or hidden fees. You’ll also want to be able to freely upgrade, downgrade, or cancel at any time. With SimpleTexting, you can do all three right from your account. 

On our quest to give customers as much flexibility as possible, we let them hold on to unused credits. Any credits they don’t use will roll over until the end of the following month.

6. Is There a Discount for Annual Plans?

We offer a 20% discount on our yearly plans and often SMS marketing solutions will offer an annual discount. It’s worth considering if you’re looking to save money in the long term. 

The ROI of Mass Texting

You’ve determined your plan amount, and now you’re wondering what kind of return you can expect.

Of course, how you measure ROI will determine what you’re trying to achieve. But to give you an idea, here are a few examples of what others have achieved:

The open rate of SMS messages is 98%, the click-through rate of texts is 36%, and the conversion rate of SMS is 29%. 

If you’re using it to save time, the average response time for a text message is only 90 seconds, and the response rate is 7.5x higher than email.

The best way to determine your potential ROI is to apply these metrics to whatever you want to use SMS marketing to achieve.

How Do You Calculate Your SMS Marketing ROI?

Calculating the return on investment (ROI) for your SMS marketing efforts is more an art than a strict science. That’s because different businesses have unique goals, and the metrics that matter most can vary widely.

For example, you might focus on the click-through rate (CTR), which measures how many people clicked a link in your SMS message relative to the total number of recipients. Meanwhile, another business could look at the conversion rate to see how many clicks actually resulted in sales or other desired actions.

Another metric to consider is the cost per subscriber. Cost per subscriber accounts for the amount you spend on the campaign and divides it by the number of subscribers you have. Knowing this figure can give you an idea of how much you spend per subscriber, which is crucial for evaluating the financial feasibility of your campaign.

In other words, there’s no one-size-fits-all approach. Depending on your business objectives—whether that’s driving sales, increasing engagement, or other goals—you’ll need to weigh these metrics differently.

Taking a multi-faceted approach to measuring your campaign’s effectiveness, from CTRs and conversion rates to cost per subscriber, will help you gain a well-rounded view that can help guide future SMS marketing efforts.

An Affordable and Effective Communication Channel

There’s a misconception that SMS is an expensive communications tool. The reality is that it’s not only affordable, but it’s also so effective that you have to ask yourself: can you afford not to be using it?

Drew Wilkinson
Drew Wilkinson

Drew Wilkinson is the Head of Marketing at SimpleTexting. Drew has more than a decade of experience managing successful integrated marketing programs to build brands, raise awareness, and generate demand.

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