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Why local businesses should communicate with customers via text messages

There are about 3.8 billion smartphone users in the world, with 80 per cent of Australians using one in 2021.  

According to Podium’s 2021 Local Business Messaging Trends report, Australians on average open text messages within three minutes.

The research found 95 per cent of texts were opened in that time and texts overall have an open rate of 98 per cent. 

Podium Australia Manager Dave Scheine explained this data made it easy to see how text messaging has become a compelling tool for business, especially as email only has an open rate of 18 per cent. 

“Customer communication has evolved over time and our research shows consumers are rapidly gravitating towards a channel that offers convenience and speed; text,” he said. 

COVID-19 has altered consumer exceptions and more Aussies are plugged into their mobile devices than ever before. 

“Rather than relying on email threads, text messaging allows real estate agents businesses to instantly, conveniently and personally communicate with their customers to, for example, book an inspection, answer questions about a property or collect a payment,” Mr Scheine said.

Mr Scheine believed providing texting as a service was the “difference between good businesses and great ones”.

“This change is reflected in the research as SMS text messages have a 209 per cent higher response rate than emails, phone and Facebook,” Mr Scheine said. 

In comparison, emails also only have a 2.6 per cent click-through rate.

What does this mean for businesses?

Despite low adoption rates from businesses, 66 per cent of customers believe being able to text businesses would be more convenient than email or phone calls. 

Podium found text was the preferred communication channel of all age groups and four out of 10 customers were either ‘likely’ or ‘very likely’ to switch to a different business because they offer those capabilities. 

However, only 12 per cent of small to medium business (SMEs) use text as a marketing tool, according to the research.  

Australian consumers use a variety of channels to message but SMS texting (or iMessage) is still the first choice (56 per cent). 

The remaining 44 per cent is done via third party apps such as WhatsApp, Telegram, and Facebook Messenger.

In fact, even if a business offered calls, email, website chat and Facebook along with texting, consumers are 1.8 times more likely to choose texting. 

Why are so many Australians keen to text with local businesses?

In simple terms, texting is more intimate. 

Consumers feel less overwhelmed by text, rather than having to sort through a seemingly endless stream of emails.

Additionally, they prefer conversation. Gone are the days where consumers are happy with ‘no reply’ email accounts spamming their inbox.

Podium found 76 per cent of Australians would converse with a local business if they knew a real, human representative was on the receiving end. 

Texting implies a personal, real relationship, whereas automated services can turn people off.

While 19 per cent of Australians are already communicating with local businesses via text, a further 47 per cent want to have the ability to do so. 

The conversational feel needs to start from the first message. Instead of, “Hi, this is XYZ Real Estate”, try out, “Hi, this is Alex from XYZ Real Estate”. 

The survey showed providing your real name in addition to where you’re from can enhance your response rate. 

In fact, 56 per cent of Australians report being more likely to respond to a text message if the sender introduced themselves as a person. 

Customers also want to hear from you more than you might expect.

More than 60 per cent want to hear from a local business they’ve opted into at least once a week (but going above that leads to un-subscriptions). 

The most crucial component in that is ‘opt-in’, as 47 per cent of Australian consumers have received texts from businesses when they didn’t give permission. 

Additionally, 59 per cent of Australians would unsubscribe from messaging if the local business texted them without prior permission. 

What makes a compelling text message? 

  • Incentives and discounts (61 per cent)
  • Loyalty offers and benefits (56 per cent)
  • Back in stock notifications (35 per cent)
  • Invitations to upcoming events (28 per cent) 
  • News and updates about the business (22 per cent)
  • Helpful content related to products or services (22 per cent)
  • Product or service recommendations (17 per cent)

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