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Ep. 46 - SMS Marketing: How to Comply and How Much is Its Value with Adam Turner

Adam Turner is the CEO of Postscript.io, an SMS Marketing tool working with thousands of Shopify stores, including Brooklinen, Steve Madden, and Native.

Previously, Adam managed e-commerce stores for publishers, including the CNN and Mashable stores. He lives in Denver, CO, and has a husky that loves chewing on deer antlers.

In This Conversation We Discuss:

  • [1:27] Adam’s first path towards digital marketing and e-commerce
  • [3:47] How does Postscript work?
  • [5:08] Creative ways people use Postscript
  • [5:41] Sponsor: Simplr simplr.ai/honest
  • [6:32] The TCPA and SMS Compliance in the US
  • [8:45] Can store owners use old customer phone numbers from their store?
  • [11:23] “There’s a way to market anything without being overbearing” - Chase
  • [11:31] Respect in SMS marketing
  • [12:16] Sponsor: Gorgias gorgias.link/honest
  • [13:05] Using SMS to create great customer experiences
  • [15:38] Pricing: SMS vs Emails
  • [16:39] Lifetime Value: SMS vs Emails
  • [17:52] Compliance is essential for SMS marketing

Resources:

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Transcript:

Adam Turner

But the other side of that is that you have to make sure that you're keeping up a decent cadence so they don't forget about you.

 

If a friend of yours texts you once a month and you don't reply then that might not be much of a friendship, right? So, keeping up the cadence on that channel and keeping it healthy is important.

 

Chase Clymer

Welcome to Honest eCommerce where we're dedicated to cutting through the BS and finding actionable advice for online store owners.

 

I'm your host Chase Clymer and I believe running an online business does not have to be complicated or a guessing game. If you're struggling with scaling your sales electric is here to help to apply to work with us visit electriceye.io/connect to learn more.

 

Now let's get on with the show.

 

Hey everybody, welcome back to another episode of Honest eCommerce. I am your host, Chase Clymer and today coming all the way from beautiful Denver, Colorado. A good friend of mine, Adam Turner, how you doing Adam?

 

Adam Turner

Hey Chase, thanks for having me on. I am feeling great, but a little bit chilly these days.

 

Chase Clymer

Yeah, I mean, it's pretty cold in Columbus too and I'm gonna be flying there actually, one week from today I'm going to be flying and he's... Adam's actually going to be speaking at a Shopify meetup we're putting on in Denver next week as well.

 

Adam Turner

Yeah, the last one was a killer, so I'm excited!

 

Chase Clymer

Awesome. So I haven't even told people what you do yet. They just know that you're cool. So, Adam is the CEO of Postscript, which is an SMS marketing tool. We'll get into that in a minute. And he's got a pretty cool background. So take us back, Adam, what was your first job that kind of took you down this path of, you know, digital marketing and eCommerce?

 

Adam Turner

Yeah, so I feel like every entrepreneurial story doesn't start out without failure. So, about five years ago, my brother and I started a consumer gaming business and for about a year and a half, we were working outside of a kitchen, eating bean and cheese burritos all day. And things did well but they didn't do well enough.

 

So that was it. That was a nice big failure, but I ended up going to, as they say, "lick my wounds" at an eCommerce company. So, I was at StackCommerce, which is a company that runs white-labelled eCommerce stores for publishers. So like running the CNN store and the Mashable store, right, so we had dozens of eCommerce stores that we were running, and I was in charge of, like product management and growth over there. So, that's kind of where my background fits into this eCom stuff.

 

Chase Clymer

And no more burritos?

 

Adam Turner

(laughs) No more burritos. Now, I do like to make some ramen every now and then just to like, you know, go back to my roots.

 

Chase Clymer

Awesome. Awesome. So anyway, you can get back into it. Sorry, I cut you off there.

 

Adam Turner

No, no, it's all good. So basically, while I was there, we had like an email list that had 6 million people on it and it was growing at a steady rate but basically like our returns were diminishing over time. And whether that's because of the email strategy or just email click-through rate declining in general, I saw that appeared along with our mobile traffic. Basically, increasing from 50%, close to 70%, by the time I left. So like these two trends were sort of pointing me off to what was happening in eCom.

 

And then that on top of like Facebook ads. I think any eCommerce entrepreneur can understand the Facebook ad like CPM/CPC crisis right now. And we were seeing that a lot. We're spending millions of dollars every month on Facebook and the tax for it is increasing, right? So all of this combined with a buddy of mine running a Shopify store being like, "I wish I could text my customers."

 

That sort of spurred the idea of just at least trying to build an SMS platform. And since then, it's just been this crazy wild ride. We launched about a year ago, ran over 4000 shops, and just listening to our customers and building what we think is the right thing for them.

 

Chase Clymer

That's amazing. So just to clarify here, so how are these people texting their customers? Is there like a dashboard? Where are they getting these texts? Where are they getting these numbers from? You know, how does it work?

 

Adam Turner

Yeah so, the easiest way to explain it is that we're kind of like MailChimp, but for SMS. In the same way that you would work with an email service provider like MailChimp or Klaviyo, we focus specifically on SMS. So everything has messaging pipes underneath which has some interesting implications and the type of product that we build because everything has to be two-way.

 

So we have campaigns and we have automation and all that good stuff, but we also integrate with every helpdesk. So when people reply, the customer support team can handle it inside Zendesk or Gorgias or anything like that. And then we have different interesting tools for acquisition, like keywords where people can text in a keyword to subscribe to a shop so people are running like national TV campaigns with their Postscript keywords in them to try and build their SMS list. So it's similar to email but in a lot of ways, it's different.

 

Chase Clymer

That's super cool! And it's a creative way that running a TV ad or something. Or what is it? What's the other thing where they talk? Radio! Kinda like podcasts. (laughs)

 

Adam Turner

Right? Yeah.

 

Chase Clymer

Yeah, and having a texting call to action. That's pretty fun. Because you know, it's pretty quick.

 

Adam Turner

Yeah, people are doing some really interesting things there. They're putting it all over their packaging or like cards inside their packaging to build their SMS list. And then also they're running Facebook lead ads that pipe directly into Postscript.

 

So, essentially with one click on a Facebook lead ad, they can start building their SMS list and you know if you can acquire a phone number for a couple of dollars or $1 or 2 and then flip it for $50 on the other end, that's a super interesting prospect for a lot of our customers. That is super cool.

 

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Chase Clymer

How's texting when you consider like GDPR and all the crazy stuff that's going on with you know, spam these days and how Europe is a completely different monster than here in America?

 

Adam Turner

Yeah, so it's super interesting. I gotta give some credit to our government for this because they were thinking ahead. They kind of saw what happened with email. And they created all the laws beforehand with robocalls and text messaging to protect the consumer, which I think is great in the long run. So, text messages are regulated by what we call the TCPA.

 

And that it's... Think about GDPR/CAN-SPAM but like 10x. So what does that mean? You need explicit written consent from the consumer that they want to be texted. So that can come in the form of them texting your number to opt-in, or an unchecked checkbox on checkout or on any other forms with TCPA compliant language. And there's a lot of things like that goes into that. But that's the brief overview.

 

And then on top of that, waking hours. So you can't text people at night. You don't want to be waking people up, and there are laws around that. So you can't text people before 8 am in their local time and after 9 pm in their local time. So that type of stuff is super important.

 

And if there's one thing that people take away from the podcast, is that you should get compliant immediately even if you're not going to be doing SMS for a few months. And whatever platform you're going to be going on, you need to be collecting your phone numbers compliantly.

 

It really breaks my heart when people download Postscript and they come on and they think that they can use all of their previous phone numbers and they can't. The liability is about $500 to 1500 dollars per message. So, we're talking for bigger stores tens of millions of dollars in liability if they use their previous phone numbers.

 

So, my one takeaway is please, get compliant. Because I talk to stores all the time that just wish they could use their phone numbers from the past but if they get the language right, then they can. That's super important that we think of ourselves as like a compliance first organization and we really want to pass that on to the market just so everybody stays healthy.

 

Chase Clymer

Cool. I actually like that right there. I want to talk about that a bit more. So, not being compliant is a big pain in the butt. So, say I have a store and I'm doing alright. I'm pretty successful. I'm seeing some cool stuff with my automation through emails. We kind of figured out our Facebook funnel and we can pretty much predict what we're going to make every month depending on what we're going to put into marketing.

 

So, I'm sitting on this list of phone numbers that I have from the Shopify store, are they still just absolutely useless? Or should I think outside the box on how do I get these people that I already know to opt-in?

 

Are people doing some remarketing on Facebook with specific language to get them to join their list or people emailing them saying, "Hey, we actually got texting as well which one would you prefer?" What have you seen people do that have been in that situation?

 

Adam Turner

It's funny because I've heard you say before that people ask, "Is email dead?" Email is certainly not dead. I would say that before you think about text messaging, you should have your email strategy down pat. So that's the first thing.

 

And then if you have old phone numbers, basically the easy way is that you just cannot use any of them. So how do you quickly build a list especially coming off on Black Friday or any other holidays? You want to be able to build a list and get inside their text message inbox instead of their email inbox. You can do that in a couple of different ways.

 

But the best way by far is to email all of your current lists and ask if they want to or incentivize them to subscribe to SMS. And we provide short links that you can put inside your emails where if they click it on mobile, it'll just pre-populate a text inside their text message app and they can just click send and be subscribed.

 

Or if they're on desktop, they go to a landing page that has a form fill to put in their phone number, but definitely incentivize those opt-ins so that you can essentially spread your contact list across multiple channels similar to going on Facebook Messenger or any other channels.

 

You want to build up all those lists everywhere. You don't just want to be on Facebook. You want to be on Instagram, Snapchat, all that good stuff. It's a very similar type of thinking. And I know that you're a fan of Gary Vee, and I am too.

 

But the way we see SMS right now is kind of like the early days of Google ads and Facebook ads: It's a brand new channel. And so brands that are really diving all in are getting all the benefits right now. While the CTR's are high, while the open rates are high. So we kinda see it like that.

 

Chase Clymer

Yeah, I just hope that it doesn't become as gimmicky as... I want to say that Facebook chat almost became there which was like, "If you're not on Facebook chat, you're wrong."

 

Adam Turner

(laughs)

 

Chase Clymer

I think there's a way to market anything without being overbearing, and you know, just ruining the experience for your customers. So, keep that in mind.

 

Adam Turner

Oh, yeah, absolutely. I mean, we see all different types of strategies from our customers. What we've seen is that: If you treat this (SMS) like email and you send multiple campaigns a week or multiple campaigns a month even, it burns out the channel very quickly.

 

So, you want to be definitely very respectful of every single person on your list and be mindful of how many messages you're sending out to them and the different messages that you want to send.

 

Text messaging is for important things like product drops and shipping notifications and that type of stuff. It's not a silver bullet or a panacea for your marketing needs.

 

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Chase Clymer

Yeah, so let's talk about how those two channels kind of play against each other. I guess asking for hard numbers would be a weird thing to ask.

 

But say for a store that's sending an email a week/ a campaign a week, obviously sending a text on the same frequency might be going too far, especially since the open rates a lot higher, the engagements going to be a lot higher.

 

I feel like you're going to burn through your customer giving you that invite into their cell phone/into their hand if you're sending it on the same frequencies as emails. Is that something that you guys see on your end as well?

 

Adam Turner

Yeah, absolutely. If you're sending one email a week, then sending a text on that cadence will definitely exhaust your list. And on top of that, text messaging is really expensive. Verizon is taking their cut. They're taking their couple cents per message and that stuff matters. So not only will it burn out your list, but you're also going to be spending a lot of money just trying to keep up the channel.

 

So what we recommend is if you're sending a newsletter a week on email, it's probably at most a campaign a month. But that also depends on what you're doing that month. If we're talking November, you might want to send something on Black Friday.

 

And then also, if you're coming out with a new product line earlier the month, that might be important to send there. But what we suggest for opening up the channel to better engagement is really utilizing like the two-way manner of the channel.

 

So what that looks like is when someone clicks "Purchase" on your site, giving them a purchase confirmation and letting them know that they can reply at any time to be in touch with a service rep, that creates like the magical moments that will build up your brand and the trust in that channel so that when you do want to send the campaign out, it's that much more effective.

 

So what that looks like is: "Hey, thanks for your order. Let us know if you need anything else here." And then people reply, they say "When is it going to be shipped? Is it going to get here in time for Christmas?" And you can reply back to them, create a nice customer experience.

 

And then next time when you send a promotion through that channel, they'll be like, "Oh, this is a company that I know. I was just chatting with someone on here. This is probably them sending me a message." So you have to engage with it. Similar to how you might engage with a friend over a text message.

 

But the other side of that is that you have to make sure that you're keeping up a decent cadence so they don't forget about you. If a friend of yours texts you once a month, and you don't reply, then that might not be much of a friendship. So, keeping up the cadence on that channel and keeping it healthy is important.

 

Chase Clymer

Absolutely. So I kinda want to go back to something you said there that texting is expensive. So how's that compared to emails? I already know the answer, I just want you to talk about it. (laughs)

 

Adam Turner

(laughs) Yeah, yeah. So it really depends on the type of volume you're sending. Obviously, with more volume, you get better discounts. But you're looking at one to two cents or more per message. And especially if you're sending a GIF or a photo, that's going to cost you possibly two or three times as much.

 

We have seen that especially for high-end women's fashion brands, the photos and GIFs are the keys to the text message. They really make the whole deal. But for everything else on SMS is pretty good. But yeah. With email, you might be talking a couple of cents per thousand emails. So it's a couple of orders of magnitude difference, which is why we think managing the engagement on the channel and not using email will save your wallet and also save your list.

 

Chase Clymer

Cool. So let's flip it though. Like what's the value of that phone number versus like the value of an email. Let's talk lifetime values or just however you like to compare it.

 

Adam Turner

Yeah, so I use my previous experience in eCom just to get the lifetime values of emails but it totally differs per brand. For my last job, it was between $5 to $10 per email address. So we can acquire an email for $1. And then we would eventually make $5 to $10 from it.

 

And what we're seeing with our brands on SMS is: For a single phone number that you've gathered compliantly, you could be getting that same LTV every 30 days from that phone number. So if your entire lifetime value of a phone number is 12 months, then you're talking 12 times more LTV for a phone number than for an email.

 

But again, these are just very broad numbers. And it really depends on what type of brand you're running and how you're using the channel. If you're sending a campaign every week, I can't vouch for the same numbers.

 

Definitely, right now we're seeing the type of stuff that people saw early on with Google ads and Facebook ads.

 

Chase Clymer

Awesome. Cool. Well, first of all, I want to thank you for coming on the show today. I know that you've got some awesome stuff that you want to share. So, first of all, if you're going to get into SMS and you want to kind of explore that for your business, going back to almost the beginning of the conversation is you want to be compliant.

 

So, Postscript actually has got a cool compliance guide that we're going to link to in the show notes. But if you're one of those people that don't like show notes, it's going to be postscript.io/compliance. So you can check that out if there's something that you want to do.

 

And then Adam, I'll let you share the awesome offer that you guys are giving to the listeners because that's actually fantastic.

 

Adam Turner

Yeah, also for compliance, something I added earlier was, if you don't want to type in that address (postscript.io/compliance), you can just text compliance to 29071 and you'll just get a link to that and we don't collect your email address or anything. We just want the market to be super helpful. And so we've worked with the best TCPA law firm to create that guide.

 

Now for Honest eCom listeners, just because I love the podcast, you can text honest to 29071 and we'll give you your first 30 days free and we'd love to onboard you on to our platform.

 

So, we know that SMS can be sort of daunting, and it's a new channel for people. And they want the best practices setup from the start. And so we're just going to do that for all the listeners. And if you have any questions, you can also just text our team there. And we'll be available.

 

Chase Clymer

Awesome. Adam, is there anything else that you think that would be worthwhile to share with our listeners today?

 

Adam Turner

Just get compliant and start collecting compliant phone numbers because you'll be thanking yourself in the future for making that decision, no matter what platform you use. So please, please let's keep this market healthy. And let's keep these customers happy with the way they use the channel.

 

Chase Clymer

Awesome. Dude, thank you so much for coming on the show and I'm looking forward to having a beer with you next week.

 

Adam Turner

Alright, see you next week Chase.

 

Chase Clymer

I cannot thank our guests enough for coming on the show and sharing their journey and knowledge with us today.

 

We've got a lot to think about and potentially add to our businesses.

 

Links and more information will be available in the show notes as well.

 

If anything in this podcast resonated with you and your business, feel free to reach out and learn more at electriceye.io/connect

 

Also, make sure you subscribe and leave an amazing review. Thank you!