Customer Lifetime Value (CLV) is an estimation of the future revenues that will be generated by each customer less the cost of goods sold, acquisition costs, and support/operational costs. A marketer can calculate CLV using either the simple, custom, or traditional equation method, but the most accurate estimate can be found by averaging these three values. The largest variation of CLV between SMS, Apps and Email will be the subscriber lifespan of each channel. There is also some variation between each channel due to the demographic preferences of using particular channels. You can increase the subscriber lifespan with well crafted customer engagement strategies which we will discuss in this article.
CLV is an important factor in your return on investment (ROI) calculation. The cost to acquire a customer (CAC) varies between Email, Applications, and SMS/MMS Messaging channels. The CAC can be calculated by taking the total cost of marketing spent and dividing it by the number of acquired customers. The ROI of any marketing or advertising campaign is determined by subtracting the CAC from the CLV. To maximize ROI a marketer must maximize the CLV while keeping the CAC to a minimum. We will discuss ROI in a separate blog post.
Email Marketing typically has a great return on investment due to its low ongoing cost of delivery coupled with a large potential audience. While many email marketing messages may be ignored or missed, the low cost of sending makes this approach cost effective for the customers that are reached. The lifetime value of an email subscriber is calculated using the lifetime of email subscription.
Mobile Applications or Apps communicate with users by sending quick, attention-grabbing, push notifications. A push notification can provide users with instructions, reminders, updates, and more. Additionally, many apps use gamification or loyalty programs to increase app use and engagement. The lifetime value of an app user is calculated using the lifetime the app is installed.
SMS/MMS Messaging allows brands to text their promotions to opted-in customers. Text messaging supports 2-way interaction making it the most engaging channel. With 94% of text messages being opened within five minutes of being sent according to Practical Ecommerce, messaging offers a great opportunity to reach customers. The lifetime value of a SMS/MMS user is calculated using the lifetime the customer is subscribed to the SMS campaign.
The common thread between all three methods for calculating the CLV is the lifespan of the customer. Maximizing your subscriber lifespan is the easiest way to increase your customer lifetime value. Customer engagement techniques are used to increase that lifespan of a customer.
The three principals of customer engagement are:
- Sending messages at an acceptable frequency
- Sending messages at the right time
- Sending messages with appealing content
Frequency: Each channel has different optimal frequencies due to the level of engagement of the channel. Email has a higher optimal frequency than SMS because an email is less of an interruption. Sending too many SMSes may cause customers to unsubscribe since they cannot easily be ignored like Email. Push Notifications from Apps fall in-between SMS and Email. They can be configured by the customer to alert in a way similar to SMS, but like email messages they can be put aside until later, and possibly be forgotten or cleared without reading them.
Timing: Most marketing emails are read in the morning or at night because many customers are unable to read their personal emails at work. Apps usage is also discouraged from being used during work hours. Due to the nature of SMS, these messages can be quickly observed at work without causing a noticeable lengthy distraction. But, if you sent an SMS to a person too early or late at night, they may feel it was an inappropriate time for this type of message. SMS messaging is best sent during the day or immediately before or after work.
Content: An email typically has a lot more content to read through, but due to over-saturation, emails are commonly skipped over and left unread. The length of an SMS is shorter, but is usually opened immediately and nearly all SMSes are read within the first 3 minutes of receiving them. While it is difficult to fit much content into an SMS the content is much more likely to be read or clicked on.
The key to achieving your goals using these engagement channels is to leverage them in ways that best meet the customer’s expectations. By sending appealing content, at the right time, by the proper channel and with an acceptable frequency, the lifespan of each customer will increase and so will your Customer Lifetime Value.
You can now continue the conversation with your customer by asking follow-up questions based on their response to the previous SMS data collection question. You are able to ask continuous questions after each SMS reply. Follow-up questions are easy to design and the data is stored in the subscriber’s audience manager profile. To set it up, select the “Reply back with an SMS or MMS of your choice” box, then select “reply with a question”. With this update you are able to ask either a multiple choice or an open ended follow-up question. You can send out the first SMS question through the message scheduling or auto-responder functions in the campaign manager to get things started.
Benefits of the Update:
You now have the ability to gather even more specific data from your users by asking follow-up questions after your initial question. Seamlessly continue the dialogue with your customers in a natural conversational setting. Gather more valuable data by asking more than one question to further continue the dialogue. You can also skip asking irrelevant questions by only sending follow-up questions to those who submitted specific answers. With this data you can get a better understanding of who you are targeting.
SMS data collection also allows you to segment your customers into different lists based on their responses. If you are interested in learning more about SMS data collection or receiving a demo please send an email request to firstname.lastname@example.org.
The update: Our Wallet marketing platform now includes iBeacon support, allowing account holders to display lock-screen notifications relevant to the location of a Beacon. A Beacon is a Bluetooth enabled device that broadcasts an identifier for other Bluetooth enabled devices to receive. When other Bluetooth enabled devices that have the wallet object (ie Pass) installed are within range of a known Beacon, they will be able to determine their relevancy and display customized notification. Devices such as an iPad can serve as a Beacon or Beacons can be small key-fob devices where all they do is broadcast their signal.
Benefits of the Update: iBeacon notifications are a great promotional tool. They allow account holders to display notifications on the mobile device locks screens at very specific locations where GPS may not be accurate or unavailable to the Wallet application. These notifications can be updated with new and more relevant promotions. Beacons can also vary their broadcast strength so that location can become more targeted or less targeted depending on the situation. For example, instead of targeting 100 meters around a store with typical GPS based relevancy, a store might target shoppers in a particular section of the store with iBeacon technology.
One of the great features of a mobile wallet is that the stored Passes can be updated after they are installed. Additionally when the Pass is updated the brand can notify the user of the update in a format similar to a Push Notification. When we update a Pass the wallet compares the existing data to the new data and if something has changed it will show a message to inform the user of this change. If you want to provide a custom message regarding the change you can add customized text to the updated Pass.
Skycore has the capability to define what this notification text and icon says to the end user. We call these ‘Push Update Notifications” because they are update notifications that display similar to Push Notifications. Previously, when a pass was updated with Skycore’s API, the device would prompt the user of the update; however, the brand could not define exactly what was said in the update notification. Now, brands can write their own informational messages about the update and it will be displayed as a push notification based on the wallet settings.
How a Pass Update will look: Different operating systems will exhibit different behaviors depending on the Wallet App installed on the device.
iOS Update Notifications:
Typically, an iOS device shows notifications on the lock screen and notifications center and also additionally as an ‘Alert’ or ‘Banner’ on the screen. It could be configured per app from the Settings->Notifications Center on the device (Screenshot below).
The actual update notification reads – “To our valued customers, we have extended the validity of this coupon. The new expiration date is 12/31/2014. Thank you for choosing Footprint Sneakers.” See example below.
Android Update Notifications:
Pass updates on Android with PassWallet installed show update notifications in a little different manner than an iOS device.
The Pass Update is highlighted when the Pass is opened:
Both Passbook / Apple Wallet and Androids PassWallet will show the area that was updated highlighted with a circle around it when it is opened for the first time after update.
The Obstacle: Not every phone supports PDF, vCard, or iCal delivered by MMS within the messaging app but nearly all smartphones support these file types within their web browser. A device which receives an unsupported MMS attachment will sometimes display a message that reads “This message includes an attached file not shown.” and other times it will display nothing at all, as if the attachment never existed.
The Solution: When sending an MMS message containing a PDF, vCard, or iCal attachment it is essential to detect the recipient device prior to sending and adapt the message so that the attachment can be delivered in a compatible format to all devices. We tested nearly every device on the market today and added information to our device database on whether the device supports the attachment in the MMS messaging client. We are then able to deliver the PDF, vCard or iCal in the most appropriate way to devices that may not support it and allow the user to still receive the attachment.
Going forward, Skycore will deliver PDF, VCard and iCal MMS attachments within the MMS message itself only to phones that support it. For the phones that do not support these content types we will store the attachment on our server and replace the attached file with a link with the MMS that directs to the attached file. We registered the generic domains like “pdf-attach.co”, “vcontact.co” and “vcalendar.co” to host these links so that consumers will know what they are clicking. If the attachment is unique for individual recipients, as in the case of dynamic content, then each link will be unique as well.
In the preview below, there is an example of the same message delivered to an iPhone and a Galaxy S5. The iPhone has the capability to open all file types, so all are displayed. The Galaxy S5 is only able to open the vCard. This is why the .pdf and .ical files provided with links.
We hope this post gives you a better understanding of the challenges to delivering PDF, vCard, and iCal by MMS properly across all smartphone operating systems. You can learn more about delivering VCards and iCalendars by MMS on our previous blog post.
Platform Update: Skycore now offers unlimited SMS & MMS keyword creation for all paid messaging plans!
Benefits of the update
Run more campaigns simultaneously or segment existing campaigns
In the past account holders who reached their keyword limit had to either upgrade their account, or restrict the number of campaigns that they were able to run at one time. This update eliminates this dilemma. Now account holders will have a greater capability to simultaneously conduct multiple campaigns or create segmented lists.
Track Call-to-Action effectiveness
By providing paid accounts with unlimited keywords, we have expanded each account holder’s capacity to measure the success of their list building efforts in various ad mediums.
One example of this would be a family style restaurant that asks their customers to opt into a campaign via keyword to receive weekly specials. If this restaurant places ads in commercials, billboards, and even on their menus, with the same keyword, they do not know which mediums best influenced customers to join the campaign. If each medium is given a unique keyword, not only are we able to determine the most effective medium but A/B test to perfect the most effective call-to-action copy on that medium.
The Update: We now support an MM7 protocol option on our API interface. This gives Skycore and our partners an end-2-end tool to accept MM7 messages from other carriers, service providers or enterprises. We can then forward the message via MM7 or deliver it directly to a mobile device by MM1. This feature is optional for our enterprise customers but is also deployed as a telecommunications IaaS (Infrastructure as a Service) for aggregators or mobile network operators who want a next generation MM7 gateway without the costs of on premise infrastructure or new software.
Enterprise Customer Benefits:
Aggregator Portability: Before this update service providers who had ALREADY built an MM7 API would have to update their code to support Skycore HTTP API interface. Today any customer with an existing MM7 connection can now easily port their connection to Skycore (or vise versa) without any code modification. Service Providers and Enterprises with multiple SMS/MMS aggregators, or direct carrier connections, can unify their MM7 routing and provisioning through a single interface. The MM7 interface is connected and certified into nearly all tier-1 US aggregators and tier-1 US carriers (as well as a few international carriers). Delivery of the MMS can be done by either MM7 or MM1 depending on your routing preferences. MM1 delivery can offer significant costs savings and increased throughput on certain network operators where it is available.
Mobile Network Operator Customer Benefits:
No Infrastructure or operational costs: Moving your MM7 Gateway into the cloud has many benefits since there are no physical infrastructure or operational costs for maintaining it. As mobile phones support larger files each year and as your MMS traffic spikes with large bulk messaging campaigns you will not need to purchase additional equipment or hire engineers to install, support, monitor, or maintain your A2P MMS gateway infrastructure.
Continuous Improvements: With continuous deployment, your cloud based MMS software will stay up to date and you will never have to buy new licenses or pay annual maintenance fees. Your VAS and business customers will be happy that you’re supporting new file types and file sizes for the latest phones and messaging technologies.
Unlimited Scale: Since the MM7 gateway is hosted in cloud infrastructure we can deploy additional load balanced servers as you grow. Without worrying about file storage or bandwidth limitations in your own data center you can scale your business seamlessly in both MMS throughput and MMS file size demand. In other words, delivering HD video MMS messages at 100 messages per second is no problem.
Simple Provisioning and Reporting: With a web based administrative portal your business team can manage your provisioning and reporting online based on your revenue objectives and not based on whether Network Operations has the time to setup a VPN, short code, or delivery report URL.
MM1 Delivery as MMSC Proxy: As a Network Operator, you do not need to buy a larger MMSC or additional hardware to support delivering additional MMS MT MM7 traffic. Skycore can deliver the messages as your proxy MMSC by MM1 thereby offloading all of the additional network traffic over our public cloud infrastructure. Your existing MMSC would continue to handle MMS MO and P2P MMS traffic without interruption or additional configuration.
Today Skycore has spun off our email solution into a new service called MailPact. The service features an unlimited email and subscriber solution where you only pay for how fast you would like to send. No more paying per subscriber or per message for your email marketing or transactional email. The solution works as a campaign management tool where you need to connect your own SMTP server or use an SMTP service like Sendgrid, MailGun or Mandrill.
Existing email customers on Skycore.com will continue to be able to use Email within the Skycore platform pricing however new customers will not have access to the Email capabilities and must sign up with Mailpact.com. Skycore platform customers are encouraged to move their subscribers and API calls to Mailpact.com so that they no longer will be paying transaction fees per message.
Step 1: Create a campaign in your Skycore.com account. We suggest that you use the following settings.
- Set the campaign name to “Delivery Status Notifications” or something similar. The campaign name will appear in the Opt-in message. This will ensure that the customer is aware of what they are agreeing to.
- Set the “Re-Subscribe Opt-in SMS Flow” to OFF. This means that if a customer is already subscribed they will not receive the opt-in message flow again.
- Set the “Re-subscribe Auto-responders” to OFF. This means that if the customer is already subscribed they will not receive any auto-responders again.
Step 2: At checkout provide customers with an optional checkbox to receive SMS delivery status updates. When checked, make sure to request their mobile phone number and disclose they will be receiving text messages to their phone and that it is not a required part of the purchase.
Step 3: After customers submit their order, your server will need to call the subscribe API function. Within this API call below you to change the “API_key=”, “mobile=” and the “campaignid =”sections of the API.
- “api_key=” is your account’s API key.
- “mobile=” is the customer’s phone number including the country code.
- “campaignid=” is the campaign ID can be found on the “SMS/MMS Campaigns” page.
Step 4: Once the Subscribe API is called, the customer will be sent an opt-in message requesting their ‘written consent’ to receive text messages from you. Affirmative written consent is a FCC mandate which is why we ask the customers to reply “YES”. Your customers will then be segmented into three groups in your Audience Manager.
- Subscribed Users – Customers who reply “YES” or “Y” and have not unsubscribed.
- Unconfirmed Users – Customers who did not reply “YES” or “Y” but who checked your checkbox to receive delivery notifications.
- Unsubscribed Users – Customer who unsubscribed themselves by replying “STOP”, “QUIT”, “CANCEL” or “UNSUBSCRIBE”.
Step 5: All messages you send out will automatically start with your brand name as they did in the double opt-in message above. To send messages, use the SendSMS API call. In the SendSMS API call below, you will need to change the “api_key=”, “to=”, “text=” and “campaignref=” sections.
- “api_key=” is your account’s API key.
- “to=” is the customer’s phone number. Make sure to include the country code.·
- “text=” is the actual message you will be sending out.
- “campaignref=” is the campaign ID of the campaign that you are sending the message from.
Step 6: When you call the API – you should receive one of two messages depending on if the customer is subscribed into the campaign or not:
- A “Success” message, and the customer should be receiving your SMS very shortly.
- A “Failure” message which means the customer has not opt-in. They will not receive any SMS message and we recommend that you flag the user as opt-out in your internal database.
Example of an API Success Message and an API Failure Message:
As we kick off 2015, it is looking like this year is going to be all about visual marketing and brand recall. Brands will be sponsoring messages in applications like Facebook, Instagram and Twitter with interesting pictures in order to increase a metric called ‘brand recall’ which is used to measure their success. Brands who have built up SMS lists will be sending MMS messages to their lists for that same reason.
The question we are often asked is what the best image size is for delivering an MMS message. Each year, screen dimensions change as popularity shifts to larger, taller screens. Over 96% of consumer devices on the market have phones with screens that are in portrait mode (tall). If you check out the Tier 1 US carrier’s websites even the old school flip phones are all portrait mode nowadays. The only phone being sold by the Tier 1 US carriers that is still landscape(wide) is the Blackberry 9930. Even the Blackberry Z10 and Q10 are not landscape. The Z10 is portrait and the Q10 is square at 720×720. Therefore you should focus your effort on delivering a beautiful portrait image that is compelling to your audience.
We’ve created a number of different images and delivered them as an MMS to a number of popular phones on the market today of various sizes. Here are our results.
After completing these tests we found that an aspect ratio of 9:16 worked best across all devices. We suggest using images that are 640px by 1138px, or 1080px by 1920px if you want a larger version.
When you upload an image above 640px by 1138px and over 100Kb the Skycore platform will transcode and optimize your image and adapt the markup to fit the screen width. Images 640px by 1138px and below may have higher file sizes but will still be transcoded on delivery if required.
When we tested the different devices we found that the iPhone 5s and iPhone 6 would first open up to a preview screen and then would display a full screen version of the image if you tapped again. In that preview screen there is a border on both the top and the bottom that cuts off some pixels. We did some research and were able to find the exact number of pixels for the suggested screen sizes that are being cut off for both the iPhone 5s and the iPhone 6. We suggest that when creating your MMS images that you refrain from putting any logos, barcodes or important information in these temporarily covered areas. You can see in the image below the red area that represents the covered area. Due to the popularity of the iPhone 5 and 5s that you keep important information far enough from the bottom and top edge.
We went on to test the 640×1138 and 1080×1920 files sizes on the Blackberry Bold 9900 to see how the image would be viewed on their landscape screens. Here you can see our results of how the image normally looks as well as how it would appear if you zoom in. Both looked exactly the same and the zoom was no issue at all for an everyday blackberry user. Just pinch the screen outwards similar to how an iPhone works.
Go To Market Recommendation:
Create an image that is 640px by 1138px or 1080px by 1920px at any file size up to 1.5Mb . For 640px by 1138px do not put any “content of interest” in the top 129px and the bottom 89px, and for 1080px by 1920px do not put any “content of interest” in the top 218px and the bottom 150px. The Skycore platform will transcode your content to the appropriate file sizes for each carrier and device.
You are set for 2015!