The Beginning of SSPs: SMS Finally Getting the Email Treatment
December 15th, 2008 by Matt ThomsonOne of the questions that we ponder daily at the Istobe HQ is why oh why email service providers (ESPs) like ExactTarget haven’t really jumped on the SMS marketing bandwagon. After all, it seems as though SMS marketing would logically be the next email and that the ESPs would be uniquely positioned to capitalize on this new market by leveraging their customer base to help establish the new marketing channel. Alas, it still hasn’t happened for major players like ExactTarget. Just the opposite. It seems that ExactTarget is actually trying to downplay the effectiveness of newer technologies (witness their new white paper that claims “Email Works Better than Social Networks”). But there are other ESPs out there that aren’t just trying to milk their lead in the email space and are instead embracing technological changes that are already afoot. Let’s take a look at two companies who are taking the ESP model and moving it into SMS marketing.
Lyris just recently announced that it is now incorporating SMS marketing into its Lyris HQ suite, making it one of the first reputable companies with a solid ESP clientele to join the SMS fray. Now, Lyris does say that this is an “API-based” solution, meaning that it is either A) potentially powerful or B) a year away from being turnkey. I also noticed that Lyris has partnered with Air2Web for the SMS side, which probably means that you’ll be paying Air2Web reseller prices if you go with the Lyris mobile solution.
iLoop looks as though they have also embraced the potential of the ESP model working within the SMS arena. They’ve got the mFinity platform, which seems to provide much of the content management that is the bread and butter of ESP ilk. Of course, like all companies that are waiting for mobile to truly hit, iLoop has really expanded the amount of services and/or products they provide in the mobile arena almost to a fault. This makes it unclear whether or not they are really ready to make a turnkey product for companies or if they intend on forever selling to ad agencies. If the latter is the case, then companies with smaller marketing budgets, and with less time to spend on their mobile campaigns, will be waiting a while on iLoop.
In both of these companies, what we do see is a movement from simple SMS gateways and reselling of bulk SMSs to a more comprehensive solution that treats SMS more as marketing channel and less as technology. As I mentioned earlier, much of this has to do with the advent of easy content and list management - management aspects that have made ESPs so very successful. In the case of SMS, if these two features can be coupled with cheap, bulk pricing, then SMS Service Provers (SSPs) will be on the cusp of something big.
Tags: ExactTarget, iLoop, Lyris, sms, SSP
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December 16th, 2008 at 5:10 pm
Thanks for mentioning the study and addressing the area of emerging channels. I would like to clarify a couple things that I believe are incorrect in your assessment. First, ExactTarget absolutely believes in the power of SMS. We announced the integration of SMS into our application over a year ago (http://email.exacttarget.com/Company/Press/Detail/Default.aspx?id=934). The research you mention on channel preferences stemmed from this announcement as a way to inform our clients, and the industry at large, about how consumers wisely incorporate this new channel into an overall marketing strategy.
Most customers simply feel that advertising via SMS and Social Networks is intrusive. That does not mean they are off limits. In fact, we recently released a “Field Guide to SMS” (http://email.exacttarget.com/Resources/Whitepapers/ExactTarget_Field_Guide_SMS.html) that outlines how to use SMS in a way that engages, instead of angers, subscribers. We believe there are similar opportunities in the Social Media space, but the grim reality is that if we think of SMS or Social Networks simply as new direct marketing channels through which we can send our marketing messages, your customers will quickly despise these messages and the brands that send them.
I encourage you and your readers to take a look at the report on Channel Preferences that demonstrates why “preferred communication channels” are not synonymous with “preferred marketing channels”. (http://email.exacttarget.com/Resources/Whitepaper/2008_Channel_Preference_Survey.html)
Thanks again. I hope the context helps clarify this.
Morgan Stewart
ExactTarget
Director, Research & Strategy
December 17th, 2008 at 12:17 pm
[...] pontificated Monday on what we perceived as the reluctnace of the big Email Service Providers to hop aboard the [...]
December 17th, 2008 at 12:53 pm
ExactTarget has offered SMS as a part of our one-to-one digital marketing platform for about a year and a half. Permission-based marketers with urgent or portable communications are using ExactTarget SMS alongside their email, voice and landing pages programs.
January 19th, 2009 at 10:18 pm
[...] as my blog posts such as Mobile Marketing - Five Steps to Start the Art and Master Targeted SMS and The Beginning of SSPs: SMS Finally Getting the Email Treatment attest. So I talk about it a lot as a great, new channel, even if only used as a higher form of [...]