Messente logo

The Definitive Guide to SMS Compliance

     BONUS MATERIAL: The Psychology of SMS Marketing

The commercial SMS messaging industry is complicated and it is important that you understand and recognize the specifics of SMS compliance and text message rules and regulations. Sending the incorrect message to the wrong person at the wrong time may have a negative impact on your customer experience as well as put your company at risk legally.

What is SMS compliance?

Woman in a sweatshirt using a smartphone

SMS is a very successful marketing method that allows businesses to reach customers more effectively. It is a channel where customers are most likely to see the text messages and click on them. Additionally, it is one of the most practical and popular methods of communication. However, when it comes to business and customers, communication needs to include proper consent.

There used to be no protection against spamming customers with text messages and acquiring their phone numbers. Whereas now, there are four primary entities that oversee SMS compliance such as:

  • Federal Communications Commission (FCC)

  • Federal Trade Commission (FTC)

  • Mobile Marketing Association (MMA)

  • Cellular Telecommunications Industry Association (CTIA)

When establishing SMS marketing campaigns, it is important to study and feature industry norms including MMA's Consumer Best Practices for Messaging and Cellular Telecommunications Industry Association's Short Code Monitoring Program. 

Additionally, only the Federal Trade Commission and the Federal Communications Commission have the power and jurisdiction to define SMS compliance rules.

SMS regulations in Europe

European Union flag

Using SMS messages for marketing purposes requires different laws and regulations, depending on where you live. In the European Union and The United Kingdom, the GDPR which stands for the General Data Protection Regulation governs the use of SMS commercial activities and is meant to protect the personal data of individuals located in the UK and EU.

GDPR establishes standards on what businesses and other organizations do with personal data, including the types of data that can be gathered and any information that may be used to identify you such as your name, IP address, phone number, etc. 

Furthermore, the GDPR covers the transfer of data outside of the European Union, which means that it applies to all enterprises that do business within the EU or utilize personal data from EU individuals.

There are seven principles that the GDPR sets out for the processing of personal data in accordance with the law which include:

  • Lawfulness, fairness, and transparency

  • Purpose limitation

  • Data minimization

  • Accuracy

  • Storage limitation

  • Integrity and confidentiality (security)

  • Accountability

These principles serve as the regulation's leading rules and guidelines for compliance processing. The data controllers are responsible for data processing, following the regulation's principles as well as must show that they are following the law. Consumers should be protected and empowered, not exploited or disregarded, according to the EU's new policy on online privacy. 

Additionally, this regulation applies to enterprises of all sizes and concentrates on data authorization, access, and focus.

SMS regulations in the US

United States flag

In the United States, electronic communications which include anything from SMS, email, calls, and more, are strictly restricted and regulated by SMS laws. Businesses and organizations must follow any state-specific text messaging law that applies to their region in addition to these federal restrictions. There are two federal laws that oversee the use of electronic communications which include the CAN-SPAM Act for emails and the Telephone Consumer Protection Act for SMS.

The Telephone Consumer Protection Act (TCPA) was enacted into law in 1991 and is the primary regulation that covers SMS marketing in the United States. With this law, businesses are prohibited from sending text messages to customers without their authorization and the penalties for it can range from $500 to $1,500 per text. Even if the person has a long-lasting relationship with the firm or has given them their own phone number, the company isn't allowed to send text messages without their formal written consent.  

In order to add members to their subscription list, companies must receive specific written consent, which refers to an agreement that is stored and documented rather than written on paper. It is your obligation to guarantee that your SMS messaging campaign is legal and acceptable, as well as familiarize yourself with any relevant industry regulations, legislation, and guidelines.

Opt-in methods

Consumers are protected by opt-in messaging since it reduces the number of unsolicited text messages and ensures that they only get text messages from companies they signed up for and want to hear. An opt-in indicates that the recipient has chosen to receive text messages and gives you permission to send additional messages. 

However, based on your industry and the sort of messages you want to send, you may need to get permission in a variety of methods.

Businesses also employ double opt-in messaging, which demands customers to confirm their registration after completing their sign-in process. This acts as double protection against legal charges, tarnished company image, fines, and more.

Under the TCPA law, and as discussed above, businesses need to ask for consent before, however, that is not the only reason for it. Sending messages to customers who do not wish to receive them will also impact the image of your company and make for poor marketing campaign efforts.

Opt-in methods also include many benefits such as:

  • There are fewer spam complaints.

  • Improved conversion rates.

  • Increased open rates.

  • Increase engagement rates.

  • Security against fines.

Opt-out process

There are always going to be people who don't wish to have messages sent to them, despite how great your products or services are, which is why businesses should implement an opt-out process the same way as an opt-in.

The opt-out message usually compromises wording confirming the customer's decision to opt-out of receiving any future text messages from your company. The word opt-out refers to a recipient's selection to opt-out of receiving text messages from you.

You can include keywords or phrases for the customers to use in order to stop the messages such as "UNSUBSCRIBE", "QUIT", "CANCEL", "STOP", "OPT-OUT", and many more. 

Transactional vs Promotional

There are two types of SMS messages that businesses sent out: transactional SMS and promotional SMS, each with its own distinct purpose, core message, as well as unique SMS compliance criteria.

It is vital to grasp the distinctions between the two before your start to use SMS marketing to help your business and know how each can be beneficial to your strategy. Here is what each of the two SMS categories means.

Transactional SMS

Businesses usually employ transactional SMS to communicate transitional information. They reach out to their subscribers directly to convey vital facts that aren't tied to promotional activities, such as order status, alerts, ad more. So it is a non-marketing automated message that businesses send to customers for the sole purpose of informing and supporting customers along their buying process.

Transactional messages provide the timely distribution of essential information since they are automated. This implies that these messages may be delivered quickly in response to a specified trigger, with no need for user intervention.

Besides that, they also enhance customer engagement since they are more than simple messages or alerts. Transactional messages assist organizations and their customers to develop a solid communications channel because if a customer is receiving regular information, they will feel appreciated and cared for when employing your services.

These messages are not only more engaging for customers, but they are also more time-sensitive, and dependable, providing customers with information through a fast and secure channel.

In most cases, a transactional SMS does not require a double opt-in message since the required opt-in may be provided by the customer when they enter their phone number. However, if the customer does add in their phone number, the company should specify they will only be sending transactional messages and not promotional ones.

Promotional SMS

Promotional SMS is a low-cost, high-impact marketing strategy that allows you to promote your business and services directly to your customer's mobile phones. They are sent by a company to potential consumers and clients reminding them of special deals, promotions, and discounts.

When following all the necessary legal procedures and overall done correctly, this type of SMS may attract new customers and, as a result, increase sales. However, it is easy to obtain these benefits when you use a credible provider such as Messente for your marketing campaign.

Businesses frequently gain consent from their customers by advertising a keyword that people may text to opt-in. This keyword is often marketed on a business' website, social media, in-store signage, and more. Many firms, particularly e-commerce enterprises, employ both sorts of SMS methods.

What happens if I don't follow the rules?

SMS is a powerful marketing strategy that requires laws and regulations to be followed correctly and failure to do so could result in your business facing serious legal actions, not to mention tarnishing your brand image. Companies that fail to follow these laws face heavy fines, beginning at $500 for each unlawfully delivered text message.

Conclusion

SMS marketing can be a terrific method to keep your audience engaged but you need to know how to do it correctly by following the guidelines. As long as you adhere to the Telephone Consumer Protection Act (TPCA) in the United States or General Data Protection Regulation (GDPR) if living in Europe, your marketing strategy will be effective and successful.

Uku Tomikas
2022-01-04 00:00:00 UTC
2371151